Highlights
World marketed energy consumption is projected to increase by 50 percent from 2005 to 2030.Total energy demand in the non-OECD countries increases by 85 percent,compared with an increase of 19 percent in the OECD countries. |
In the IEO2008 reference casewhich reflects a scenario where current laws
and policies remain unchanged throughout the projection periodworld marketed
energy consumption is projected to grow by 50 percent over the 2005 to
2030 period. Total world energy use rises from 462 quadrillion British
thermal units (Btu) in 2005 to 563 quadrillion Btu in 2015 and then to
695 quadrillion Btu in 2030 (Figure 1). Global energy demand grows despite
the sustained high world oil prices that are projected to persist over
the long term.
The most rapid growth in energy demand from 2005 to 2030 is projected for
nations outside the Organization for Economic Cooperation and Development
(non-OECD nations). Total non-OECD energy demand increases by 85 percent
in the IEO2008 reference case projection, as compared with an increase
of 19 percent in OECD energy use. The robust growth in demand among the
non-OECD nations is largely the result of strong projected economic growth.
In all the non-OECD regions combined, economic activityas measured by
GDP in purchasing power parity termsincreases by 5.2 percent per year
on average, as compared with an average of 2.3 percent per year for the
OECD countries.
The IEO2008 reference case projects increased world consumption of marketed
energy from all fuel sources over the 2005 to 2030 projection period (Figure
2). Fossil fuels (liquid fuels and other petroleum,1 natural gas, and coal)
are expected to continue supplying much of the energy used worldwide. Liquids
supply the largest share of world energy consumption over the projection
period, but their share falls from 37 percent in 2005 to 33 percent in
2030, largely in response to a reference case scenario in which world oil
prices are expected to remain relatively high.
Average world oil prices in every year since 2003 have been higher than
the average for the previous year. Prices in 2007 were nearly double the
2003 prices in real terms. Prices rose further into the third quarter of 2008, reaching $147 per barrel in mid-July, when they were well above the historical inflation-adjusted record price for a barrel of oil set in the early 1980s. A variety of factors have caused oil prices to increase rapidly since 2003, including
strong demand growth in non-OECD Asia and the Middle East, no growth in
production between 2005 and 2007 from the members of the Organization of the Petroleum
Exporting Countries (OPEC), rising costs for oil exploration and development,
across-the-board increases in commodity prices, and a weaker U.S. dollar.
In the IEO2008 reference case, prices ease somewhat in the medium term,
as anticipated new productionboth conventional and unconventional (in
Azerbaijan, Brazil, Canada, Kazakhstan, and the United States, for example)reaches
the marketplace. Ultimately, however, markets are expected to remain relatively
tight. In nominal terms, world oil prices in the IEO2008 reference case
decline from current high levels to around $70 per barrel in 2015, then
rise steadily to $113 per barrel in 2030 ($70 per barrel in inflation-adjusted
2006 dollars).
In addition to the reference case, IEO2008 includes a high price case that
helps to quantify the uncertainly associated with long-term projections
of future oil prices. In the high price case, world oil prices in 2030at
$186 per barrel in nominal termsare nearly 65 percent higher than projected
in the reference case (Figure 3). Given current market conditions, it appears
that world oil prices are on a path that more closely resembles the projection
in the high price case than in the reference case. With higher world oil
prices slowing the growth of demand in the long term, world liquids consumption
in the high price case totals only 99.3 million barrels per day in 2030,
13 million barrels per day lower than in the reference case.
Liquids are expected to remain the worlds dominant energy source throughout
the IEO2008 reference case projection, given their importance in the transportation
and industrial end-use sectors. World use of liquids and other petroleum
grows from 83.6 million barrels oil equivalent per day in 2005 to 95.7
million barrels per day in 2015 and 112.5 million barrels per day in 2030.
The liquids share of world energy consumption declines through 2030, however,
as other fuels replace liquids where possible. In most regions of the world,
the role of liquid fuels outside the transportation sector continues to
be eroded. Liquids remain the most important fuels for transportation,
because there are few alternatives that can compete widely with liquid
fuels. On a global basis, the transportation sector accounts for 74 percent
of the total projected increase in liquids use from 2005 to 2030, with
the industrial sector accounting for virtually all of the remainder.
To meet the increment in world liquids demand in the IEO2008 reference
case, total supply in 2030 is projected to be 28.2 million barrels per
day higher than the 2005 level of 84.3 million barrels per day. The reference
case assumes that OPEC producers will choose to maintain their market share
of world liquids supply, and that OPEC member countries will invest in
incremental production capacity so that their conventional oil production
represents approximately 40 percent of total global liquids production
throughout the projection. Increasing volumes of conventional liquids (crude
oil and lease condensates, natural gas plant liquids, and refinery gain)
from OPEC members contribute 12.4 million barrels per day to the total
increase in world liquids production, and conventional liquids supplies
from non-OPEC countries add another 8.6 million barrels per day (Figure
4).
Unconventional resources (including oil sands, extra-heavy oil, biofuels,
coal-to-liquids, and gas-to-liquids) from both OPEC and non-OPEC sources
are expected to become increasingly competitive in the reference case.
World production of unconventional resources, which totaled only 2.5 million
barrels per day in 2005, increases to 9.7 million barrels per day in 2030,
accounting for 9 percent of total world liquids supply in 2030 on an oil
equivalent basis. Biofuels, including ethanol and biodiesel, will be an
increasingly important source of unconventional liquids supplies, largely
because of the growth in U.S. biofuels production. In the IEO2008 reference
case, the United States accounts for nearly one-half of the rise in world
biofuels production, at 1.2 million barrels per day in 2030.
The composition of supply differs substantially between the reference and
high price cases. High prices encourage the development of previously uneconomical
unconventional supplies, which account for a much larger portion of total
liquids supply than in the reference case in 2030 (nearly 20 percent, as
compared with about 9 percent in the reference case). Conventional supplies
decline over the projection period in the high price case, by 1.5 million
barrels per day, compared with an increase of 21.0 million barrels per
day in the reference case. The high price case assumes that OPEC member
countries will maintain their production at near current levels. As a result,
OPEC is willing, in this case, to sacrifice market share as global demand
for liquids continues to grow. The high price case also assumes that oil
resources in non-OPEC countries will be less accessible and/or more expensive
than in the reference case.
Worldwide natural gas consumption in the IEO2008 reference case increases
from 104 trillion cubic feet in 2005 to 158 trillion cubic feet in 2030.
Natural gas is expected to replace oil wherever possible. Moreover, because
natural gas combustion produces less carbon dioxide than coal or petroleum
products, governments may encourage its use to displace the other fossil
fuels as national or regional plans to reduce greenhouse gas emissions
begin to be implemented. Natural gas is expected to remain a key energy
source for industrial sector uses and electricity generation throughout
the projection period. The industrial sector, which is the worlds largest
consumer of natural gas, accounts for 43 percent of projected natural gas
use in 2030. In the electric power sector, natural gas is an attractive
choice for new generating plants because of its relative fuel efficiency.
Electricity generation accounts for 35 percent of the worlds total natural
gas consumption in 2030.
Much of the worlds growing demand for natural gas is projected to be met
by increased production from non-OECD nations. In the IEO2008 reference
case, non-OECD countries account for more than 90 percent of the worlds
total growth in production from 2005 to 2030 (Figure 5). A significant
portion of the non-OECD production (excluding Russia and the other nations
of Eurasia) is expected to be in the form of export projects particularly
liquefied natural gas (LNG) projects. The Middle East and Africa are at
the forefront of the trend toward LNG: natural gas production in the two
regions combined increases by 21.0 trillion cubic feet between 2005 and
2030, but their combined demand for natural gas increases by only 9.9 trillion
cubic feet. Significant increases in natural gas production are also projected
for the countries of non-OECD Asia, but those supply increases are expected
to be used largely for consumption within the region rather than for export.
In the absence of national policies and/or binding international agreements
that would limit or reduce greenhouse gas emissions, world coal consumption
is projected to increase from 123 quadrillion Btu in 2005 to 202 quadrillion
Btu in 2030, at an average annual rate of 2.0 percent. Coals share of
world energy use has increased sharply over the past few years, largely
because of strong increases in coal use in China, which nearly doubled
between 2000 and 2005 and is poised to increase strongly in the future. With its large
domestic base of coal resources and continuing strong economic growth,
China alone accounts for 71 percent of the increase in world coal consumption
in the IEO2008 reference case. The United States and Indiaboth of which
also have extensive domestic coal resourceseach account for 9 percent
of the world increase.
World net electricity generation nearly doubles in the IEO2008 reference
case, from about 17.3 trillion kilowatthours in 2005 to 24.4 trillion kilowatts
in 2015 and 33.3 trillion kilowatthours in 2030. Non-OECD developing countries
show the strongest growth in electricity demand as they expand their power
grids to support sustained robust economic growth. Total electricity generation
in the non-OECD countries increases by an average of 4.0 percent per year
from 2005 to 2030, as compared with a projected average increase of 1.3
percent per year for OECD electricity generation.
Coal and natural gas account for the largest increments in fuel consumption
for electricity generation over the projection period. The 3.1-percent
projected annual growth rate for coal-fired electricity generation worldwide
is exceeded only by the 3.7-percent rate for natural gas-fired generation
(Figure 6). Sustained high prices for oil and natural gas make coal-fired
generation more attractive economically, especially for coal-rich nations
like China, India, and the United States.
The outlook for fossil-fuel-fired generation could be altered substantially
by international agreements to reduce greenhouse gas emissions. The electric
power sector offers some of the most cost-effective opportunities for reducing
carbon dioxide emissions in many countries. Coalthe worlds most widely
used source of energy for power generationis also the most carbon-intensive.
If a cost, either implicit or explicit, were applied to emitters of carbon
dioxide, there are several alternative no- or low-emission technologies
that currently are commercially proven or under development, which could
be used to replace some coal-fired generation. Implementing the technologies
would not require expensive, large-scale changes in the power distribution
infrastructure or in electricity-using equipment.
Technology transformation in the end-use sectorssuch as transportationcould be more difficult, to the extent that extensive changes in the motor vehicle fleet, fueling stations, and fuel distribution infrastructure may be needed. Efficiency improvements are an alternative for reducing emissions from equipment that uses either electricity or other fuels.
Electricity generation from nuclear power is projected to increase from
about 2.6 trillion kilowatthours in 2005 to 3.8 trillion kilowatthours
in 2030, as concerns about rising fossil fuel prices, energy security,
and greenhouse gas emissions support the development of new nuclear generation.
Higher capacity utilization rates have been reported for many existing
nuclear facilities, and it is anticipated that most of the older nuclear
power plants in the OECD countries and non-OECD Eurasia will be granted
extensions to their operating lives. Still, there is considerable uncertainty
associated with nuclear power.
Issues that could slow the expansion of nuclear power in the future include
plant safety, radioactive waste disposal, and the proliferation of nuclear
weapons, which continue to raise public concerns in many countries and
may hinder the development of new nuclear power reactors. Moreover, high
capital and maintenance costs may keep some nations from expanding their
nuclear power programs. Nevertheless, the IEO2008 reference case incorporates
the improved prospects for world nuclear power. The IEO2008 projection
for nuclear electricity generation in 2025 is 31 percent higher than the
projection published in IEO2003 only 5 years ago.
In the IEO2008 reference case, the worlds installed nuclear capacity grows
from 374 gigawatts in 2005 to 498 gigawatts in 2030. Declines in nuclear
capacity are projected only for OECD Europe, where several countries (including
Germany and Belgium) have either plans or mandates to phase out nuclear
power, and where some older reactors are expected to be retired and not
replaced. On a regional basis, IEO2008 projects the strongest growth in
nuclear power for the countries of non-OECD Asia. Of the 68 gigawatts of
additional installed nuclear generating capacity projected for non-OECD
Asia between 2005 and 2030, 45 gigawatts is in China and 17 gigawatts in
India. Outside Asia, the largest increase in installed nuclear capacity
among the nonOECD nations is projected for Russia, which is expected to
add 18 gigawatts of new nuclear generating capacity over
the mid-term projection.
High prices for oil and natural gas, which are expected to persist in the
reference case, also encourage expanded use of renewable fuels. Renewable
energy sources are attractive for environmental reasons, especially in
countries where reducing greenhouse gas emissions is of particular concern.
Government policies and incentives to increase the use of renewable energy
sources for electricity generation are expected to encourage the development
of renewable energy even when it cannot compete economically with fossil
fuels. Worldwide, the consumption of hydroelectricity and other renewable
energy sources increases by 2.1 percent per year in the IEO2008 reference
case, from 35 quadrillion Btu in 2005 to 59 quadrillion Btu in 2030.
In the non-OECD nations, much of the growth in renewable energy consumption
is projected to come from mid- to large-scale hydroelectric facilities
in Asia and in Central and South America, where several countries have
hydropower facilities either planned or under construction. Among the OECD
nations, hydroelectricity is fairly well established, and with the exception
of Canada and Turkey there are few plans to undertake major hydroelectric
power projects in the future. Instead, increases in OECD renewable energy
consumption are expected to be in the form of nonhydroelectric renewables,
especially wind and biomass. Many individual OECD countries have incentives
in place to increase the penetration of nonhydroelectric renewable electricity
sources, both to reduce greenhouse gas emissions and to promote energy
security, and in the IEO2008 projections OECD renewable generation grows
by 1.6 percent per year from 2005 to 2030, faster than all the other sources
of electricity of generation except natural gas.
Over the next 25 years, world demand for liquid fuels and other petroleum
is expected to increase more rapidly in the transportation sector than
in any other end-use sector (Figure 7). The transportation share of total
liquids consumption increases from 52 percent in 2005 to 58 percent in
2030 in the IEO2008 reference case. Much of the growth in transportation
energy use is projected for the non-OECD nations, where transportation
energy use increases at an average rate of 2.9 percent per year, doubling
between 2005 and 2030. Strong growth in income per capita supports the
growth in transportation energy demand, and the reference case anticipates
that many of the worlds emerging economies will experience rapid modernization
of their transportation systems in order to move products and raw materials
to market, particularly in developing rural areas where economic growth
often is achieved by increasing product exports.
The transportation infrastructure in OECD countries generally is considered
to be well-established. Motorization levels (as measured by vehicles per
1,000 people) are fairly high in the OECD nations, where roads and highways
connect most of the population centers. Mature transportation sectors and
relatively slow projected growth rates for gross domestic product (GDP)
and population among the OECD economies lead to the expectation that transportation
energy demand will increase only modestly. Transportation energy demand
in the OECD economies is projected to grow at an average annual rate of
0.7 percent in the IEO2008 reference case (about one-fifth the rate projected
for the non-OECD economies), with North America accounting for approximately
one-half of the total increase in OECD consumption of liquid fuels for
transportation.
World energy-relative carbon dioxide emissions continue to increase steadily in the IEO2008 reference case, from 28.1 billion metric tons in 2005 to 34.3 billion metric
tons in 2015 and 42.3 billion metric tons in 2030an increase of 51 percent
over the projection period. With strong economic growth and continued heavy
reliance on fossil fuels expected for most of the non-OECD economies, much
of the increase in carbon dioxide emissions is projected to occur among
the developing, non-OECD nations. In 2005, non-OECD emissions exceeded
OECD emissions by 7 percent. In 2030, however, non-OECD emissions are projected
to exceed OECD emissions by 72 percent (Figure 8).
1
Liquid fuels and other petroleum include petroleum-derived fuels and non-petroleum-derived
fuels, such as ethanol and biodiesel, coal-to-liquids, and gas-to-liquids.
Petroleum coke, which is a solid, is included. Also included are natural
gas liquids, crude oil consumed as a fuel, and liquid hydrogen. |