Transcript Slide 1
World Energy Outlook Dr Fatih Birol IEA Chief Economist Prague, 7 January 2014 © OECD/IEA 2013 The world energy scene today Some long-held tenets of the energy sector are being rewritten Countries are switching roles: importers are becoming exporters… … and exporters are among the major sources of growing demand New supply options reshape ideas about distribution of resources But long-term solutions to global challenges remain scarce Renewed focus on energy efficiency, but CO2 emissions continue to rise Fossil-fuel subsidies increased to $544 billion in 2012 1.3 billion people still lack electricity – in Africa and South Asia Energy prices add to the pressure on policymakers Sustained period of high oil prices without parallel in market history Large, persistent regional price differences for gas & electricity © OECD/IEA 2013 The engine of energy demand growth moves to South Asia Primary energy demand, 2035 (Mtoe) Share of global growth 2012-2035 Eurasia Latin America Europe 1 370 United States 4 060 2 240 Middle 1 050 East Brazil 480 1 030 Africa 1 540 5% 4% 8% China 1 710 Eurasia OECD 1 000 Africa 440 Japan Southeast Asia 8% Middle 10% East 65% India Non-OECD Asia China is the main driver of increasing energy demand in the current decade, but India takes over in the 2020s as the principal source of growth © OECD/IEA 2013 A mix that is slow to change Growth in total primary energy demand 1987-2011 Gas 2011-2035 Coal Renewables Oil Nuclear 500 1 000 1 500 2 000 2 500 3 000 Mtoe Today's share of fossil fuels in the global mix, at 82%, is the same as it was 25 years ago; the strong rise of renewables only reduces this to around 75% in 2035 © OECD/IEA 2013 Emissions off track in the run-up to the 2015 climate summit in France Cumulative energy-related CO2 emissions Total emissions 1900-2035 Gt 800 600 Non-OECD Non-OECD 49% OECD 400 200 OECD 51% 1900 -1929 1930 -1959 1960 -1989 1990 -2012 2013 -2035 Non-OECD countries account for a rising share of emissions, although 2035 per capita levels are only half of OECD © OECD/IEA 2013 Oil use grows, but in a narrowing set of markets Oil demand by sector region mb/d 105 100 Other Gasoline 95 Diesel 90 Other Middle East India 85 OECD China 80 75 2012 Transport Petrochemicals Other sectors 2035 China becomes the largest consumer of oil by 2030, as OECD oil use drops; demand is concentrated in transport, where diesel use surges by 5.5 mb/d,, & petrochemicals © OECD/IEA 2013 Two chapters to the oil production story Contributions to global oil production growth Middle East 2013-2025 2025-2035 Brazil United States Rest of the world -2 0 2 4 6 8 mb/d 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 © OECD/IEA 2013 Renewables power up around the world Growth in electricity generation from renewable sources, 2011-2035 TWh 2 100 1 800 1 500 1 200 900 600 300 Other United renewables States Solar PV Japan Wind European Union Hydro Europe, Japan and United States Other renewables Other ASEAN renewables Solar PV Solar PV Africa Wind Wind China Latin America Hydro Hydro India China India, Latin America, ASEAN and Africa The expansion of non-hydro renewables depends on subsidies that more than double to 2035; additions of wind & solar have implications for power market design & costs © OECD/IEA 2013 Increasing subsidies for increasing renewables Renewable-energy subsidies by region in 2012 Rest of the world 13% India 2% China 7% $101 billion 57% European Union 21% United States Renewables Renewables subsidies subsidies increased increased to to $101 $101 billion billion in in 2012, 2012, more than half of which are in the European Union; renewables renewables subsidies subsidies are are set set to to more more than than double double by by 2035. 2035 © OECD/IEA 2013 Who has the energy to compete? Ratio of industrial energy prices relative to the United States Natural gas Electricity 5× Reduction from 2013 4× 2035 2013 2003 3× 2003 2× United States Japan European Union China Japan European Union China Regional differences in natural gas prices narrow from today’s very high levels but remain large through to 2035; electricity price differentials also persist © OECD/IEA 2013 Energy-intensive industries need to count their costs Share of energy in total production costs for selected industries 10% 20% 30% 40% 50% 60% 70% 80% 90% Petrochemicals Fertilisers Aluminium Cement Iron & steel Pulp & paper Glass Energy-intensive sectors worldwide account for around one-fifth of industrial value added, one-quarter of industrial employment and 70% of industrial energy use. © OECD/IEA 2013 An energy boost to the economy? Share of global export market for energy-intensive goods +3% European Union +1% Today 36% 10% +2% +2% 7% 3% 2% China Middle East India Japan 7% United States -3% -10% The US, together with key emerging economies, increases its export market share for energy-intensive goods, while the EU and Japan see a sharp decline © OECD/IEA 2013 LNG from the United States can shake up gas markets Indicative economics of LNG export from the US Gulf Coast (at current prices) $/MBtu 18 15 12 $/MBtu 12 9 9 6 6 3 3 To Asia Average import price Liquefaction, shipping & regasification United States price To Europe New LNG supplies accelerate movement towards a more interconnected global market, but high costs of transport between regions mean no single global gas price © OECD/IEA 2013 Orientation for a fast-changing energy world China, then India, drive the growing dominance of Asia in global energy demand & trade Technology is opening up new oil resources, but the Middle East remains central to the longer-term outlook Regional price gaps & concerns over competitiveness are here to stay, but there are ways to react – with efficiency first in line Implementing sound energy policies in Europe has rarely been so critical for the prosperity of its people © OECD/IEA 2013