Tag Archives: World Energy Outlook 2013

World Energy Outlook 2013 Released: Energy Demand Growth Moves to South Asia

The International Energy Agency (IEA) that released World Energy Outlook 2103 yesterday says that the global energy demand for energy services is generating pace while the energy map in terms of production and consumption is rapidly changing and how. It says the engine of the energy demand growth moves to South Asia with dominance of China and India becoming more visible in the global energy trade. See blow some of the highlights from the IEA World Energy Outlook Fact Sheets and  key messages from ED IEA Maria van der Hoeven at the lunch of the report.

What global energy map in 2035 might look like? What global energy map in 2035 might look like?

On Growing Energy Demand and Shifting Energy Map

  • Demand grows for all forms of energy, but the share of fossil fuels in the world’s energy mix falls from 82% to 76% in 2035.energy mix falls from 82% to 76% in 2035 with global energy demand increasing from one third from 2011 to 2035.
  • The centre of gravity of global energy demand moves decisively towards emerging economies –they account for more than 90% of net energy demand growth to 2035. Energy demand growth in Asia is led by China this decade, but shifts towards India and, to a lesser extent, Southeast Asia after 2025.
  • China is becoming the largest oil-importing country; India becomes the largest importer of coal by the early 2020s. Improved energy efficiency and a boom in unconventional oil and gas production help the United States to move steadily towards meeting almost all of its energy needs (in energy equivalent terms) from domestic resources by 2035.

On Growth of  Renewables 

Growth of Renewables in Electricity Generation Growth of Renewables in Electricity Generation
  • The share of renewables in total power generation rises from 20% in 2011 to 31% in 2035, as they supply nearly half of the growth in global electricity generation. Rapid expansion of wind and solar PV raises fundamental questions about power market designs and their ability to ensure adequate investment and long-term reliability of supply. China sees the biggest absolute increase in generation from renewable sources, more than the gains in the European Union, United States and Japan combined
  • Global subsidies to renewables reached $101 billion in 2012, up 11% on 2011, and need to expand to $220 billion in 2035 to support the level of deployment in the New Policies Scenario. Wind becomes competitive in a growing number of regions, with about one-quarter of generation over the period to 2035 not requiring any subsidy. Solar PV becomes competitive in only a limited number of markets (when measured at “cost parity”) and requires an average subsidy of $130 /MWh through to 2035 in order to compete.

On Energy and the Competitiveness 

  • What energy means to the Economy? What energy means to the Economy?
    • Rising energy prices across many regions have led to major shifts in energy and overall trade balances, as well as to energy expenditures taking a growing share of household income.
    • Energy costs can be vital to the competitiveness of energy-intensive industries, particularly where energy accounts for a significant share of total production costs and where the resulting goods are traded extensively
    • Natural gas price differentials narrow in our central scenario, though gas and industrial electricity prices in the European Union and Japan remain around twice the level of the United States in 2035. In many emerging economies, particularly in Asia, strong growth in domestic demand for energy-intensive goods supports a swift rise in their production (accompanied by export expansion). As a consequence, developing Asia increases its export market share of energy-intensive goods to a level equal to that of the European Union by 2035. Elsewhere energy prices and the industrial outlook are more clearly linked. The United States, which experiences relatively low energy prices, sees a slight increase in its share of global exports of energy-intensive goods in the period to 2035.

On Oil Production and Supply Dynamics

Global Oil Production Outlook

 

Highlighting the changing oil production IEA says Oil supply rises from 89 mb/d in 2012 to 101 mb/d in 2035 in the New Policies Scenario. The United States (light tight oil) & Brazil (deepwater) step up until the mid-2020s, but the Middle East is critical to the longer-term oil outlook. One thing is evidently clear, given the changing energy demand and supply map, it surely will have a dramatic impact on the relative competitiveness of the major emerging economies in coming years.