by Judith Curry
[W]orld energy consumption will grow by 56 percent between 2010 and 2040. – EIA
Total world energy use rises from 524 quadrillion British thermal units (Btu) in 2010 to 630 quadrillion Btu in 2020 and to 820 quadrillion Btu in 2040 (Figure 1). Much of the growth in energy consumption occurs in countries outside the Organization for Economic Cooperation and Development (OECD),2 known as non-OECD, where demand is driven by strong, long-term economic growth. Energy use in non-OECD countries increases by 90 percent; in OECD countries, the increase is 17 percent. The IEO2013 Reference case does not incorporate prospective legislation or policies that might affect energy markets.
Renewable energy and nuclear power are the world’s fastest-growing energy sources, each increasing by 2.5 percent per year. However, fossil fuels continue to supply almost 80 percent of world energy use through 2040. Natural gas is the fastest-growing fossil fuel in the outlook. Global natural gas consumption increases by 1.7 percent per year. Increasing supplies of tight gas, shale gas, and coalbed methane support growth in projected worldwide natural gas use. Coal use grows faster than petroleum and other liquid fuel use until after 2030, mostly because of increases in China’s consumption of coal and tepid growth in liquids demand attributed to slow growth in the OECD regions and high sustained oil prices.
The industrial sector continues to account for the largest share of delivered energy consumption; the world industrial sector still consumes over half of global delivered energy in 2040. Given current policies and regulations limiting fossil fuel use, worldwide energy-related carbon dioxide emissions rise from about 31 billion metric tons in 2010 to 36 billion metric tons in 2020 and then to 45 billion metric tons in 2040, a 46-percent increase.
World economic background
The world is still recovering from the effects of the 2008-2009 global recession.3 As these effects continue to be felt, many unresolved economic issues add to the uncertainty associated with this year’s long-term assessment of world energy markets. Currently, there is wide variation in the economic performance of different countries and regions around the world. Among the more mature OECD regions, the pace of growth varies but generally is slow in comparison with the emerging economies of the non-OECD regions. In the United States and Europe, short- and long-term debt issues remain largely unresolved and are key sources of uncertainty for future growth. Economic recovery in the United States has been weaker than the recoveries from past recessions, although expansion is continuing. In contrast, many European countries fell back into recession in 2012, and the region’s economic performance has continued to lag. Japan, whose economy had been sluggish before the devastating earthquake in March 2011, is recovering from its third recession in 3 years. Questions about the timing and extent of a return to operation for Japan’s nuclear power generators compound the uncertainty surrounding its energy outlook.
In contrast to the OECD nations, developing non-OECD economies, particularly in non-OECD Asia, have led the global recovery from the 2008-2009 recession. China and India have been among the world’s fastest growing economies for the past two decades. From 1990 to 2010, China’s economy grew by an average of 10.4 percent per year and India’s by 6.4 percent per year. Although economic growth in the two countries remained strong through the global recession, both slowed in 2012 to rates much lower than analysts had predicted at the start of the year. In 2012, real GDP in China increased by 7.2 percent, its lowest annual growth rate in 20 years. India’s real GDP growth slowed to 5.5 percent in 2012.
High sustained oil prices can affect consumer demand for liquid fuels, encouraging the use of less energy or alternative forms of energy, but also encouraging more efficient use of energy. Energy efficiency improvements are anticipated in every end-use sector, with global liquids intensity—liquid fuels consumed per dollar of GDP—declining (improving) by 2.6 percent per year from 2010 to 2040. However, some of the greatest potential for altering the growth path of energy use is in the transportation sector. The U.S. transportation sector provides a good example of this potential to change future liquids consumption. More stringent U.S. vehicle fuel economy standards offset growth in transportation activity, resulting in a decline in the country’s use of petroleum and other liquids over the projection. Improving vehicle fuel economy standards will likely be adopted throughout most of the world, helping to moderate future growth in liquids consumption.
In the long term, the IEO2013Reference case projects increased world consumption of marketed energy from all fuel sources through 2040 (Figure 2). Fossil fuels are expected to continue supplying much of the energy used worldwide. Although liquid fuels—mostly petroleum-based—remain the largest source of energy, the liquids share of world marketed energy consumption falls from 34 percent in 2010 to 28 percent in 2040, as projected high world oil prices lead many energy users to switch away from liquid fuels when feasible. The fastest growing sources of world energy in the Reference case are renewables and nuclear power. In the Reference case, the renewables share of total energy use rises from 11 percent in 2010 to 15 percent in 2040, and the nuclear share grows from 5 percent to 7 percent.
Christian Science Monitor
Christian Science Monitor provides some additional text and comments:
Developing countries are driving the consumption of inexpensive fossil fuels, relying on them to fuel their emerging economies. That growth is likely to continue, but government intervention and international exchanges of low-carbon technology can help mitigate the energy and environmental impacts of economic development, experts say.
“There is still the opportunity, with smart policy interventions, to moderate the energy and emissions growth and potentially preserve the option of limiting warming to 2 degrees,” Elliot Diringer, executive vice president of the Center for Climate and Energy Solutions, said in a telephone interview.
“Rising prosperity in China and India is a major factor in the outlook for global energy demand. These two countries combined account for half the world’s total increase in energy use through 2040,” EIA Administrator Adam Sieminski said in a statement Tuesday. “This will have a profound effect on the development of world energy markets.”
“China has established itself as a global reader in renewables, in part by acquiring technology developed in the West through licensing arrangements,” Mr. Diringer said. “New coal plants built in China are state of the art. We are seeing the latest technology being deployed, but they are still building coal plants.”
The result is increasing emissions. Worldwide, energy-related carbon dioxide emissions will rise from about 31 billion metric tons in 2010 to 36 billion metric tons in 2020, according to EIA, and then to 45 billion metric tons in 2040. That’s a 46 percent increase over 30 years.
Carbon intensity, on the other hand, is slowly declining. The amount of carbon dioxide emitted per unit of economic output is expected to fall by 1.9 percent per year in OECD economies and by 2.7 percent per year in the non-OECD economies from 2010 to 2040, according to EIA. That decline is largely attributed to countries using energy more efficiently.
“This trend of decreasing carbon intensity, combined with the increase in low-carbon energy sources, is good news, but is not enough to slow carbon emissions to the levels we know that we need to prevent further climate change,” Joanna Lewis, professor of science, technology, and international affairs at Georgetown University, wrote in an e-mail.
“This only reaffirms our knowledge that ‘business as usual’ energy development is not good enough,” Ms. Lewis added, “and we need to dramatically think about how we produce and consume energy in the coming three decades, as this is a decisive time in determining our ability to mitigate future greenhouse gas emissions.”
JC comments: The EIA does a very good job with these reports, IMO (I am curious about whether there are critiques of the EIA methods and how well their previous predictions have done). These are sobering statistics for the UNFCCC: the Kyoto protocol doesn’t seem to be working (understatement). If one assumes that reducing CO2 emissions is a good thing, does anyone see a realistic path forward that will make a significant dent in these projections on a time scale of 2040?