Demography, Migration and Energy Demand. Shonali Pachauri Presented at the 2009 IAEA SF 15 September 2009

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1 Demography, Migration and Energy Demand Shonali Pachauri Presented at the 29 IAEA SF 15 September 29

2 Presentation Outline Key drivers of energy use and current treatment of demographic changes in modeling energy demand Some projections of urbanization and it s importance in certain regions Comparison of energy consumption patterns across rural and urban households in China and India Some projections of household demand for cooking energy in India accounting for rural and urban differences 2

3 Drivers of Energy Use and Demography Emissions Economic Growth Technology Policy Lifestyles Demographic change is one among many drivers Economic growth models have focused on population size and technology as key drivers. What about other demographic factors? 3

4 Demography, Energy & Emissions Population Growth/Decline Aging Urbanization Household Size Most models (used for projections) typically consider only changes in population size What are the implications of other demographic trends for future energy demand? 4

5 Global Urbanization and Energy Growing populations of South Asia, China and regions of Africa will urbanize at an increasing rate. Urban residents may use several times more energy, and energy from different sources from what they used in the countryside. Urbanization can bring with it an increasing dependence on fossil energy.

6 World Urbanization Trends Number of Mega cities Source: UN 27, World Urbanization Prospects

7 Urbanization Trends by Region Source: UN 27, World Urbanization Prospects

8 Future Urbanization Trends in India Indian Urbanization under various scenarios % A2 urbanization B2 urbanization Medium-Central urbanization Low-Central urbanization B1 urbanization Medium-Slow urbanization Source: Jiang et al. (in prep)

9 Mapping Energy Poverty Taxonomy based on final energy availability and share of non-commercial energy Source: Gruebler et al, 28 Billions of people: Abject poverty: 1.3 Poor:.6 Less poor: 1.4 Middle class: 1.4 Rich:

10 Pattern of Household Fuel Use Across Rural & Urban Areas 1% 9% 8% 7% 6% 5% 4% 3% 2% Biomass Coal Modern fuels 1% % Rural India Urban India Rural China Urban China Source: Pachauri & Jiang 28

11 Variations in Household Energy Use Patterns Across Urban Type Source: Pachauri & Jiang 28

12 Share of Urban Energy in Total Residential Energy Use Source: Pachauri & Jiang 28

13 Population Dependence on Traditional Biomass Population dependent in rural areas Brazil China India Q1 Q2 Q3 Q4 Q5 Income Quintiles Source: Victor 22 Source: Pachauri & Jiang 28, CEPAL 27

14 Household Energy Transitions in Urban & Rural India & China Urban China Rural China Percentage share in total Percentage share in total Coal Electricity Gas, oil and others Coal Electricity Gas, oil and others Biomass Urban India Rural India Percentage share in total /9 1993/ / Percentage share in total /9 1993/ / Coal Electricity Gas, oil and others Biomass Coal Electricity Gas, oil and others Biomass Source: Pachauri & Jiang 28

15 Household Energy Use Patterns in India in 24/5 Rural Households Little transition in rural areas Urban Households 6 1% 6 1% Energy in MJ/capita % 8% 7% 6% 5% 4% 3% Energy in MJ/capita % 8% 7% 6% 5% 4% 3% 1 2% 1% 1 2% 1% % % Mean expenditure by deciles in 2 PPP $ per capita Mean expenditure by deciles in 2 PPP $ per capita Electricity Kerosene Biomass LPG Coal Percentage solid fuels Electricity Kerosene Biomass LPG Coal Percentage solid fuels Source: Pachauri & Jiang 28

16 GEA Residential Access Scenarios Methodology Simple energy model of the residential/commercial sector of India Linear programming, cost optimization (based on MESSAGE) 1 consumer groups Urban/rural Five income categories Main factor affecting fuel choice Price of energy fuels & appliances Financial (budget) constraints Consumer s rate of time preference (planning horizon & implicit discount rate) Inconvenience costs of low quality fuels (biomass and coal) Policy instruments: fuel subsidy and/or micro-financing

17 Urbanization & Income Growth Assumptions for India 35% 8 33% 31% Urban income 75 7 Urabnization rate (%) 29% 27% 25% 23% 21% Urbanization rate Rural income Average Income (2Rs/cap) 19% 4 17% 35 15%

18 Results: Urban & Rural Household Fuel Use Urban in 2 Rural in Electricity LPG Kerosene Coal Biomass Electricity LPG Kerosene Coal Biomass 1 2-2% 2-4% 4-6% 6-8% 8-1% Income Quintiles -2% 2-4% 4-6% 6-8% 8-1% Income Quintiles Urban in 22 Rural in Biomass use -3% Biomass use +18% Electricity LPG Kerosene Coal Biomass Electricity LPG Kerosene Coal Biomass 1 2-2% 2-4% 4-6% 6-8% 8-1% Income Quintiles -2% 2-4% 4-6% 6-8% 8-1% Income Quintiles

19 Some Policy Implications Patterns of migration, urbanization and changes in city densities all have important implications both for the future energy mix and energy demand. In developing and least developed countries, urban slums will continue to grow, making it urgent that these areas also see investments for provision of energy services

20 Some Final Questions Might the availability of better energy infrastructure influence the direction of migration in the future? Can the absence of adequate access to clean energy sources in cities, delay the demographic transition (increase mortality and morbidity rates)?