U.S. ENERGY INFORMATION ADMINISTRATION
WASHINGTON DC 20585

FOR IMMEDIATE RELEASE
March 31, 1999

Forecast of Worldwide Carbon Emissions is Lowered,
But Continued Increase in Emissions Is Still Expected

Lower projections for economic growth - particularly in Eastern Europe, the former Soviet Union, and other parts of Asia - have led the Energy Information Administration to lower its estimates for global energy-related carbon emissions in 2010, according to forecasts released today in International Energy Outlook 1999.

Some of these expected reductions in emissions could lower the amount, as well as the cost, of carbon emissions cuts relative to 1990 levels as specified by the Kyoto Protocol for the period 2008 to 2012. Eastern Europe and the former Soviet Union (EE/FSU) in 2010 are likely to be even further below the 1990 carbon emissions levels that were projected last year. As a result, these countries will have more potential emissions credits that could be sold to other Kyoto Protocol signatories whose emissions are projected to rise substantially over 1990 levels.

Worldwide carbon emissions in 2010 are projected to be 4 percent lower than in last year's Outlook, but still 39 percent above 1990 levels. Because of further delays in the recovery of the Russian economy, the expected 2010 carbon emissions in the EE/FSU have dropped by 13 percent over last year's forecast (Figure 1). With lower carbon emissions expected, these countries will have at least 374 million metric tons of carbon emission credits available in 2010, compared to 196 million tons in last year's analysis. If the industrialized nations that have agreed to carbon emissions caps can purchase these credits, this level of trading alone would allow their carbon emission levels to rise by an average of 7 percent over 1990 levels and still meet the Protocols's average emissions target of 7 percent below 1990 levels (Figure 2).

Elsewhere, energy demand in Asia is projected to grow by more than fifty percent between 1996 and 2010, but the rate of this growth has been scaled back since last year's forecast. EIA is now expecting Asia's energy use to surpass that of North America by 2005 rather than by 2000 as projected last year (Figure 3). The Asian economic crisis-which began in the spring of 1997 and persisted throughout 1998-has temporarily stopped that region's growth in energy demand.

Other report highlights include:

• A marked slowdown in world oil demand growth accompanied by burgeoning world oil supplies drove oil prices to record lows in 1998. Asia had accounted for two-thirds of oil demand growth in the 1990s. In 1998, overall demand in the region ceased to rise and in several countries declined by 5 percent or more. At the same time, Iraq re-emerged as a major oil exporter; and oil production increased in Mexico, Central and South America, and the FSU. Toward the end of 1998, oil industry pessimism became widespread and exploration and development spending was cut by 30 percent or more.

• Natural gas is projected to be the fastest-growing primary energy source from 1996 to 2010, increasing by nearly 60 percent. Gas is becoming the fuel of choice for new electricity generation worldwide, primarily because combined-cycle gas turbine plants tend to be less expensive to build, are often more efficient than other electricity generators, and can more readily meet increasingly stringent environmental regulations. In the IEO99 projection, world natural gas consumption surpasses coal consumption by 2005.

• Over the next two decades, fast-paced growth of transportation infrastructure is expected in the developing world. Developing Asia and Central and South America are expected to account for 42 percent of the increase in the world's motor vehicle population between 1996 and 2010. Energy use for transportation among the developing countries is projected to grow at an average annual rate of 4.2 percent-more than twice the rate of growth in the industrialized countries. Even in the most economically advanced countries, transportation energy consumption per capita is expected to continue to increase, as rising per capita incomes are accompanied by purchases of larger motorized vehicles and by increased air travel for business and vacations.

International Energy Outlook 1999 is available on EIA's Internet site at: http://www.eia.doe.gov/oiaf/ieo99/home.html

Printed copies of the report will be available by April 20 , 1999 from the U.S. Government Printing Office, 202/512-1800 or through EIA's National Energy Information Center, 202/586-8800. The World Energy Projection System, the model used to generate the projections that appear in IEO99, will be available in April 1999, on EIA's Internet Web Site: http://www.eia.doe.gov

EIA Program Contact: Mary J. Hutzler, 202/586-2222
EIA Press Contact: National Energy Information Center, 202/586-8800, infoctr@eia.doe.gov

EIA-99-06

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