The World Energy Outlook after the Financial Crisis

Transcription

1 The World Energy Outlook after the Financial Crisis Presentation to the UNECE Committee on Sustainable Energy Geneva, 19 November 2009 Trevor Morgan Senior Economist International Energy Agency

2 The context The worst economic slump since the 2 nd World War & signs of recovery but how fast? An oil price collapse & then a rebound rising marginal costs point to higher prices in the longer term, but are current levels sustainable? A slump in energy investment due to the financial & economic crisis will it bounce back quickly enough to avert a supply squeeze later? Difficult negotiations on a post-2012 climate deal leading up to Copenhagen what is needed to avert catastrophic climate change?

3 How the crisis is affecting the energy sector & the environment Financial crisis Economic recession Reduced investment Financing constraints and lower demand lead to lower investment and reduced capacity Reduced energy demand Lower income directly reduces demand for energy services in near term, but might discourage spending on more energyefficient equipment in long term Impact on energy prices Lower in short term as demand stalls, but could be higher in medium term if impact of lower investment outweighs impact of recession on demand Environmental impact lower emissions in short term, but less investment in low-carbon energy and more efficient technologies could push up emissions in long term The financial crisis has hit both energy demand & supply, with uncertain medium- to longterm consequences for energy prices & the environment

4 The impact of the crisis on energy demand so far 8% 6% 4% 2% 0% -2% -4% -6% Change in primary demand (preliminary data) Oil Gas Coal Electricity Globally, primary energy demand is set to drop by around 2% in 2009 the first significant fall since 1981 with most of the fall occurring in OECD countries

5 Historical world electricity consumption TWh End of World War II Black Monday stock market crash US recession 2 nd oil price shock 1 st oil price shock Dot-com bubble burst Asian economic crisis Global credit crunch * * Estimate The financial & economic crisis is expected to result in a 1.6% drop in electricity demand in 2009 the first fall of any kind since the end of the 2 nd World War

6 Worldwide upstream oil & gas capital expenditures Billion dollars % * * Budgeted spending Global upstream spending (excluding acquisitions) is budgeted tofall by over $90 billion, or 19%, in 2009 the first fall in a decade

7 Global investment in new renewables-based based power-generation assets Billion dollars % Geothermal Marine and small hydro Biomass Solar Wind * * Projected Renewables-based power investment is set to drop by almost one-fifth to under $70 billion in 2009, though the fall would have been close to 30% without economic stimulus spending

8 World primary energy demand by fuel in the Reference Scenario Mtoe Other renewables Biomass Hydro Nuclear Gas Oil Coal WEO-2008 total Global demand grows by 40% between 2007 and 2030, with 93% of the increase coming from non-oecd countries

9 Change in primary energy demand by fuel in the Reference Scenario, China India Other Asia Middle East OECD Latin America Coal Oil Gas Nuclear Hydro Other Africa E. Europe/Eurasia Mtoe The increase in China s demand for energy for coal in particular dwarfs that of all other countries & regions

10 Cumulative investment in energy-supply infrastructure in the Reference Scenario, Total investment = $25.6 trillion (in year-2008 dollars) 14% 86% 15% Shipping & ports Mining Transmission Transport Coal Refining $0.7 trillion Biofuels 3% $0.2 trillion Oil 1% $5.9 trillion Upstream 23% Gas Power $13.7 trillion 53% $5.1 trillion 20% LNG 4% 17% 79% 9% 33% Distribution T&D 33% 52% Generation Upstream 58% Just over half of all energy-investment needs to 2030 are needed in the power sector, mainly in non-oecd countries

11 Energy-related related CO 2 emissions by fuel and region in the Reference Scenario Gt International marine & aviation bunkers Non-OECD gas Non-OECD oil Non-OECD coal OECD gas OECD oil OECD coal CO 2 emissions are expected to fall by 3% in 2009 to less than 28 Gt, but then rebound to 40 Gt in 2030 in the Reference Scenario

12 World abatement of energy-related related CO 2 emissions in the 450 Scenario Gt Reference Scenario OECD+ World abatement by technology Gt Gt Gt Efficiency 65% 57% Gt OME OC 450 Scenario Renewables & biofuels Nuclear CCS 19% 13% 3% 23% 10% 10% Measures to boost energy efficiency account for most of the reduction in emissions through to 2030, with renewables & CCS playing a growing role in the longer term

13 Abatement of energy-related related CO 2 emissions in the 450 Scenario by key emitters, 2020 Gt International carbon markets Cap & trade in power & industry sectors International sectoral standards in transport & industry National policies 0 China United States European Union India Russia Japan China, the United States, the European Union, India, Russia & Japan account for almost three-quarters of the 3.8 Gt reduction in the 450 Scenario

14 World primary energy demand by fuel & scenario in 2030 Coal -47% Reference Scenario 450 Scenario Oil -15% Gas -17% Nuclear +49% Renewables +33% Mtoe The share of fossil fuels in total primary energy demand in the 450 Scenario declines from 81% today to 68% in 2030, with gas remaining at close to today s levels of 20%

15 Additional investment in the 450 Scenario relative to the Reference Scenario Billion dollars (2008) Other Countries Other Major Economies OECD+ Financing in With OECD+ co-financing of of non-oecd investment 50% $ billion (2008) Non-OECD Non-OECD OECD+ OECD The 450 Scenario sees $10.5 trillion of additional investment tothe Reference Scenario, costing 0.5% of GDP in 2020 and 1.1% of GDP in 2030

16 Summary & conclusions The financial crisis has halted the rise in global fossil-energy use, but its long-term upward path will resume soon on current policies Energy investment has fallen sharply, threatening supply shortfalls & a renewed price shock in the medium term Tackling climate change & enhancing energy security require a massive decarbonisation of the energy system A 450 path towards green growth would bring substantial benefits Natural gas can play a key role as a bridge to a cleaner energy future The challenge is enormous but it can and must be met

17 WEO will be back in 2010 In-depth analysis of prospects for renewables Analysis of the impact of fossil-energy subsidies (in support of G20) Special focus on the outlook for oil & gas in the Caspian region

18 Thank you