Energy Outlook[fr][de] 

Energy Outlooks forecast the future global energy situation, especially in terms of energy demand, energy mix and security of supply. A range of organisations issue regular projections that serve a variety of political and economic purposes and with different emphases and different methodologies. This variety means that the Outlooks are difficult to compare. However, by setting clear parameters, it is possible to make a meaningful comparison.

In this introduction, we have chosen to compare three different points of view: the EU Commission's 'European' approach, the International Energy Agency's 'international' approach, and the 'industry' approach represented by Royal Dutch Shell and ExxonMobil. Despite the diverging approaches these studies take, they all make projections with regard to the world energy situation for the next 30-50 years.

This article will compare the various scenarios set out by the Outlooks, focusing on the estimated impact of climate change policies on the development of the global energy situation and CO2 emissions in the first third of this century.

The Commission published its 'World energy, technology and climate policy outlook' (WETO) in 2003. It compares two different scenarios: a Reference Scenario ('business as usual') and a Carbon Abatement Scenario, looking at the impact that climate change policies can have. This assessment aims to help define priorities for the policies that can be put in place to improve the performance towards reducing CO2 emissions.

I. Reference Scenario: assumptions

• current trends in business, technological and structural change in the world economy continue in the usual way, without major interference from policy-makers;
• no account is taken of specific energy or environment policy objectives and measures that were implemented after 2000, such as the CO2 reduction objectives of the Kyoto Protocol, the planned phasing-out of nuclear energy in some countries and the target share of renewables in the energy mix;
• the situation of the world energy system in 2030 resulting from the Reference Scenario is used as a benchmark for the assessment of alternatives, particularly with respect to resources, technologies and environmental policy.

Reference Scenario: results

• world energy demand is projected to increase by about 1.9 per cent per year between 2000 and 2030; this figure is based on assumptions about economic and population growth, as well as developments in energy intensity;
• industrial countries will experience a slowdown in their energy demand, but demand in developing countries will grow rapidly; by 2030, more than half of the world energy demand is expected to come from developing countries (compared to 40 per cent today);
• fossil fuels are expected to continue dominating the world energy system, representing almost 90 per cent of total energy supply in 2030; oil is predicted to remain the main source of energy (34 per cent), followed by coal (28 per cent) and natural gas (25 per cent);
• in the EU, gas will be the second largest energy source after oil, while nuclear and renewable energies will account for less than 20 per cent of EU energy supply.

II. Carbon Abatement Scenario: assumptions

• taking into account different regions' consent to commit themselves to medium-term reductions (so it does not assume a carbon value for the Commonwealth of Independent States (CIS)) and the expected reinforcement of climate change policies beyond the year 2010 (which is the deadline for the Kyoto targets);
• sustainable development policies are implemented in a large number of economic sectors;
• the enlarged EU is ahead of the other countries in terms of climate change policy: in the EU, the carbon value that would be applied to the use of fossil fuels by taking into account greenhouse gas emissions is double that of other regions.

Aim: to assess the impact of policies aimed at the global reduction of greenhouse gas emissions on the energy sector.

Carbon Abatement Scenario: results 

• 11 per cent decrease in the expected world energy consumption compared to the Reference Scenario; the average growth in demand would thus be 1.3 per cent per year, as opposed to 1.9 per cent.
• impact on carbon intensity, i.e. the global energy mix: a carbon value would primarily affect fuels with the greatest carbon content, namely coal (-42 per cent) and oil (-8 per cent), while gas would remain virtually unchanged;  
• worldwide, this market share would be taken up by nuclear energy (+36 per cent) and renewable energies (+35 per cent);
• within the renewables sector, wind, solar and small hydro are expected to increase twentyfold;
• global CO2 emissions would be reduced by 21 per cent compared to the Reference Scenario; however, they would still be higher in 2030 than they were in 1990;
• Europe's emissions level would be nearly 15 per cent lower than the 1990 level, and 26 per cent lower than in the Reference Scenario by 2030;
• the EU's changes in the energy mix reflect the world pattern, but both coal (-61 per cent) and oil consumption (-13 per cent) are considerably lower;
• in the EU, this decrease is compensated by nuclear (+35 per cent) and renewable energy (+56 per cent).

Gtoe: Giga tonne oil equivalent (= 42.7 Gigajoule)
Source: European Commission, WETO report
GtCO2: Giga tonne of CO2 

The International Perspective

The OECD's International Energy Agency sets out the latest energy projections to 2030 in its report entitled 'World Energy Outlook', published in 2002. Again, a Reference Scenario is compared to an Alternative Policy Scenario. There is a strong focus on concerns about the security of energy supplies, investment in infrastructure, the environmental damage caused by energy production and use and the unequal access of the world's population to modern energy.

Reference Scenario

• takes into account policy measures that were adopted in mid-2002 including recent efforts relating to the Kyoto Protocol and targets for renewables;
• results: energy use continues to grow rapidly, fossil fuels dominate the energy mix, and the energy consumption of developing countries approaches that of the OECD;
• CO2 emissions are set to grow slightly faster than energy consumption despite the measures taken to date;
• the projected emissions differ significantly from the Commission's outlook: while the Commission expects emissions to more than double between 1990 and 2030 (113 per cent increase from 20.8 to 44.5 billion tons of CO2), the OECD report foresees a growth of 'only' 70 per cent to reach 38 billion tonnes in 2030; this difference might be attributed to the different methodologies in which the Commission does not take into account any policy measures after 2000, while the OECD does.

Alternative Policy Scenario

• assesses the impact of a range of new energy and environmental policies that OECD countries are considering and faster deployment of new technologies;
• demonstrates a strong impact of new policies to curb energy demand growth and the energy mix; the latter would also have positive consequences for import dependence of the OECD.

Both the Commission's and the IEA's Outlooks come to similar findings: new policies and cleaner technologies would achieve energy savings and promote less carbon-intensive fuels. The OECD report predicts that this would eventually stabilise greenhouse gas emissions in the OECD countries by 2030.

The Industry Perspective

The Shell study on 'Energy Needs, Choices and Possibilities - Scenarios to 2050', published in 2001, also devised two different scenarios, which are dependent on societal preferences rather than policy choices. The first scenario, entitled 'Dynamics as Usual', is based on a world where social priorities for clean, secure and ultimately sustainable energy shape the system. In the second scenario ' The Spirit of the Coming Age', superior ways of meeting energy needs are developed to meet consumer preferences regarding mobility, flexibility and convenience.  

In both scenarios, Shell predicts an important role for natural gas as a 'bridge fuel' over at least the next two decades. The study also projects a rapid growth for renewable energy, and a potential for renewables to be the eventual primary source of energy.

The Shell scenarios explore "possible paths towards an affordable, sustainable energy system which has found solutions to environmental concerns", but they do not assess the concrete impact of policy measures on the way to this goal. However, the study suggests that for both scenarios, a stabilising atmospheric carbon dioxide concentrations below 550 ppmv would be clearly visible. There is no reference to CO2 emissions.

ExxonMobil also published a study entitled "The Outlook for Energy - a 2030 view". The key findings of this analysis of the world energy situation up to 2030 are:

• By 2030 world energy demand will increase by 50 per cent (at 1.7 per cent per year), primarily in less-developed countries;
• Oil and gas will continue to be the primary energy sources, accounting for about 60 per cent of total demand;
• Oil  will grow fastest in the developing Asia Pacific region due to increasing sales of personal vehicles; however, in North America and Europe, demand growth is expected to be offset by increasing vehicle efficiency;
• Gas will continue to grow faster than the other energy forms, meeting about 25 per cent of the world's energy demand by 2030;
• Carbon emissions will increase as a result of raising use of fossil fuels; this is most pronounced in the Asia Pacific region.
• Renewables will grow quickly, supported by government subsidies, but will contribute only a small fraction of energy supply;
• Nuclear  will continue to grow, but only at 0.8 per cent per year; however, some new plants will be constructed in developed countries after 2020 due to mounting environmental and supply security concerns.

To meet higher demand, ExxonMobil maintains that the application of new technology is the best way to meet the energy challenge. This means growing and developing the resource base as well as improving energy efficiency and reducing emissions. Moreover, the company sees increasing opportunities for new coal, nuclear and bio-fuels.