Reuters 10 Nov 09;
LONDON (Reuters) - World energy consumption will rise rapidly over the next 20 years, pushing up costs and increasing greenhouse gases, unless a deal is reached to curb carbon dioxide emissions, the International Energy Agency (IEA) said Tuesday.
In its annual World Energy Outlook, the IEA said global energy demand would increase by an average of 2.5 percent per year over the next five years if governments made no changes to their existing policies and measures.
Under these circumstances, which the IEA called its reference scenario, world primary energy demand would rise by an average of 1.5 percent per year over the next two decades.
Oil demand, excluding biofuels, would increase by 1 percent per year to 105 million barrels per day (bpd) by 2030 from 85 million bpd in 2008.
The IEA argues strongly for a global deal at the United Nations Climate Change Conference in Copenhagen in December to limit greenhouse gases and spells out how sharply use of fossil fuels will increase if policies remain unchanged.
"Fossil fuels remain the dominant sources of primary energy worldwide in the reference scenario, accounting for more than three-quarters of the overall increase in energy use between 2007 and 2030," the IEA said.
Natural gas demand would increase 1.5 percent per year to 4.3 trillion cubic meters (tcm) in 2030, under this scenario.
The main driver of demand for coal and gas would be inexorable growth in energy needs for power generation, it said, forecasting in its reference scenario that world electricity demand would grow by 2.5 percent per year to 2030.
The developing world will see some of the fastest rates of growth with the 10 countries of the Association of Southeast Asian Nations (ASEAN) seeing an average annual increase of 2.5 percent in their primary energy demand until 2030.
(Reporting by Christopher Johnson and Barbara Lewis; editing by William Hardy)
Agency Reduces Forecast for Oil Consumption
Jad Mouawad, The New York Times 10 Nov 09;
The International Energy Agency has reduced its long-term forecast for global oil consumption as countries increase the use of alternative energy sources and as the economic crisis slows demand.
The revised forecast, released Tuesday, comes as the energy agency, which acts as an adviser to industrial countries, warned that governments must soon tackle the challenge of climate change by curbing energy demand or risk a catastrophic rise in global temperatures over the next decades.
The revised forecast and the policy prescriptions are contained in the agency’s annual World Energy Outlook. This year, the 698-page publication outlines policies needed to reduce the emissions of carbon dioxide that are blamed for global warming.
“Continuing on today’s energy path, without any change in government policy, would mean rapidly increasing dependence on fossil fuels, with alarming consequences for climate change and energy security,” the forecast said.
The agency now expects global oil consumption to grow 1 percent a year in the next two decades, reaching 105 million barrels a day by 2030, from 85 million barrels a day in 2008. That estimate is lower than last year’s forecast for 2030 of 106 million barrels a day. It is also well below the 120 million barrels a day that the energy agency had anticipated a few years ago.
Oil demand could reach only 89 million barrels a day by 2030, the agency said, if the world agrees on stringent limits on their emissions of carbon dioxide.
Part of the report was released last month and was meant to provide a map for policy makers considering how to make significant reductions in the emissions of carbon dioxide.
The agency’s forecasts are based on a reference scenario that assumes no changes in energy policy from governments.
The report also outlines a “450 scenario,” which sets out what collective policies are needed to reduce the concentration of carbon dioxide and other greenhouse gases in the atmosphere to 450 parts per million. That is a level that would probably limit the projected rise in global temperatures to 2 degrees celsius, or 3.6 degrees Fahrenheit.
Government officials from about 190 nations will meet next month in Copenhagen to try to hammer out an international deal to reduce global carbon emissions, and replace the Kyoto Protocol, which ends in 2012. But international negotiators have signaled that an agreement was unlikely to be reached this year in the absence of a broad consensus on how to share the costs of switching to lower-carbon technologies and fuels.
The current energy system is unsustainable. Electricity demand, for example, is expected to rise by 76 percent from 2007 to 2030, and will require almost five times the existing producing capacity currently found in the United States. Much of that new capacity will come from burning coal, whose share in the global energy mix is expected to grow by 2 percentage points to reach 44 percent in 2030.
The economic crisis, the agency said, offers an opportunity to make big strides. As a result of lower economic activity this year, global emissions are expected to fall as much as 3 percent, the steepest decline in 40 years.
The financial crisis has reduced energy demand this year, but it has also curbed investments in new supplies.
In the oil and gas sector, most companies have announced cutbacks in capital spending, as well as project delays and cancellations, the agency said. It estimated that investment budgets for 2009 have been cut by around 19 percent compared with last year, a drop of over $90 billion.
Since October 2008, more than 20 planned large-scale oil and gas projects, involving around 2 million barrels a day of oil production capacity, have been deferred indefinitely or canceled, most of them oil sands projects in Canada. Another 29 projects, totaling 3.8 million barrels a day of capacity, have been delayed by at least 18 months.
The agency’s new forecast for long-term oil demand is also bound to stoke the anxiety of oil producing countries, which have voiced concerns about a global climate deal. Saudi Arabia and other members of the Organization of the Petroleum Exporting Counties, who rely on petroleum exports as their main source of revenue, have warned against setting limits on the usage of petroleum based fuels.
Despite the lower forecast, oil is still expected to remain the main fuel in the next decades. Even with a major agreement to reduce carbon dioxide emissions, oil will account for about 30 percent of the total fuel mix by 2030, down from 34 percent today, the agency said.
The cost of reducing carbon emissions — by boosting the investments in renewable power, developing electric vehicle, growing nuclear power, and building carbon capture and storage technology for coal-burning power plants — is high.
But the world will have to spend an additional $500 billion to cut carbon emissions for each year of delay in an agreement, the agency said.
In its “450 scenario,” energy demand would still grow 20 percent from 2007 to 2030, an average annual growth rate of 0.8 percent, compared with 1.5 percent in the reference case.
The savings would come from more efficient energy usage, increased energy efficiency in buildings, and lower energy demand from industry. In the lower-carbon world, the average emissions intensity of new cars will have to be cut by more than half.
“With a new international climate policy agreement, a comprehensive and rapid transformation in the way we produce, transport and use energy — a veritable low-carbon revolution — could put the world onto this 450-p.p.m. trajectory,” the agency said.
International Energy Agency fails to light the way to a safe climate future
WWF 10 Nov 09;
London: The keenly awaited 2009 World Energy Outlook contains some remarkable analysis but does not light the way to a safe carbon future, WWF said today.
Emissions cuts canvassed in the outlook, the flagship annual publication of the International Energy Agency (IEA), are too small and too slow to keep the world out of the danger zone of unacceptable risks of catastrophic climate change, said Dr Stephan Singer, WWFs Director of Global Energy Policy.
Scientists, the UN and many governments including the G8 group have accordingly endorsed an objective of keeping average global warming less than two degrees Celsius over pre-industrial times - an objective WWF maintains would require developed nations cutting their emissions 40 per cent below 1990 levels by 2020.
But IEAs low emissions scenario sees OECD fossil fuel CO2 emissions down just 4.5 percent from 1990 levels by 2020.
“The proposed CO2 emissions reductions by the IEA for the energy sector of the rich nations are dismal,” Dr Singer said. “The reductions seen as low carbon by the IEA are less even than the inadequate reductions so far on the table from developed nations for the UN climate change conference in Copenhagen next month.”
Also according to the IEA, global energy emissions would be one quarter more in 2030 than in the 1990 reference year.
"World-wide fossil fuel emissions in twenty years must be on a pathway to be reduced to more than 80% below 1990 levels by mid-century to curtail the climate crisis. The IEA's scenarios violate this trajectory," Dr Singer said.
For WWF, with about two thirds of global greenhouse gas emissions, the energy sector has to lead the way to a low carbon future.
And although its alternative lower emissions scenario is clearly inadequate, WWF is pleased that the IEA identifies energy conservation as the measure with the best potential to bring it about.
“The IEA also finds most of the emissions savings mechanisms it identifies will be cost effective through the saving of fuel costs and this is a useful rebuff to those urging slow action or no action on climate on the basis of costs,” Dr Singer said.
“It is a pity that the IEA couldn’t stay up to date with the science on the level of emissions the atmosphere can safely digest and use this to point the way to a fully renewable power sector by mid-century.”
“What they are suggesting is not only dangerous, but it is much below what is technically possible.”
