The World Energy Outlook (WEO) 2008 – the latest edition of the annual IEA flagship publication– is a highly respected and good resource tool to assess society’s challenges posed by worsening oil supply prospects, higher energy prices, and rising emissions of greenhouse gases. The picture presented by this important resource is not pretty for humans and their dependence on fossil fuel.
The WEO-2008 Reference Scenario, which assumes no new government policies, predicts world primary energy demand will grow by 1.6% per year on average between 2006 and 2030 – an increase of 45%. This growth in the demand for energy is slower than projected last year, and is mainly due to the impact of the economic slowdown, prospects for higher energy prices, and some new policy initiatives.
Demand for oil rises from the current 85 million barrels per day to 106 mb/d by 2030 – 10 mb/d less than was projected last year. Demand for coal rises more than any other fuel in absolute terms, accounting for over a third of the increase in energy use.
However that growth is expected to wane was renewable energy sources come on line. Modern renewable energy sources are expected to overtake gas to become the second-largest source of electricity sometime soon after 2010.
WEO-2008 also looks oil and gas production. Oil will remain the world’s main source of energy for many years to come, even under the most optimistic of assumptions about the development of alternative technology. But the sources of oil, the cost of producing it and the prices that consumers will have to pay for it are extremely uncertain.
Expanding production in the lowest-cost countries – most of them in OPEC – will be central to meeting the world’s oil needs at reasonable cost. WEO-2008 also analyses policy options for tackling climate change after 2012, when a new global agreement – to be negotiated at the UN Conference of the Parties in Copenhagen next year – is due to take effect.
The analysis assumes a hybrid policy approach, comprising a plausible combination of cap-and-trade systems, sectoral agreements and national measures. On current trends, energy-related CO2 emissions are set to increase by 45% between 2006 and 2030, reaching 41 Gt.
Three-quarters of the increase arises in China, India and the Middle East, and 97% in non-OECD countries as a whole.