Global Energy Prospects and Their Implications for Energy Security & Sustainable Development

Global energy prospects and their implications for energy security & sustainable development

Dr. Fatih Birol Executive Director, International Energy Agency OECD, Paris, 24 February 2020

Global energy demand 1919 1950 1974 2000 2018 1 500 Mtoe 14 300 Mtoe 100%

50%

Wood Coal Oil Natural gas Nuclear Modern renewables

The last century has witnessed multiple transitions to and from different fuels and technologies The challenge today is one of scale: global energy use is ten times higher than in 1919…. and growing

100 bbl

Iran sanctions Attack on Abqaiq–Khurais: Libya 80 Exports fall to multi-decade low Half of Saudi production Renewed conflict cuts

Brent $US/ Brent temporarily shut down oil output again Min-Max band $52-$75

60 Venezuela: Soleimani's death: Plummeting oil production Geopolitical tensions goes below 1 mb/d

Jan 19 Feb 19 Mar 19 Apr 19 May 19 Jun 19 Jul 19 Aug 19 Sep 19 Oct 19 Nov 19 Dec 19 Jan 20

Well-supplied oil markets, largely thanks to US shale, have traded in a remarkably narrow band despite the range of supply disruptions and geopolitical uncertainties over the last year

Change in global oil and electricity consumption, 20002018 - 20182040

Mtoe 1 200

1 000

800

600

400

200

Oil Electricity

When consumers needed more energy in the past, they traditionally turned to oil In the future, they turn first to electricity

Growth in gas demand and supply in selected Asian markets, 2018-2040

bcm 400 OtherPipeline

LNGIndustry 300 DemandPowerDomestic growth

200

100

China Southeast India Asia Developing economies in Asia account for half of global growth in gas demand, with industrial consumers taking the largest share, and this provides the spur for almost all the growth in gas trade, led by LNG

Global power capacity by source in the Stated Policies Scenario Solar PV 3 000

GW Gas

Coal 2 000 Wind Hydro

1 000

Nuclear

2000 2010 2020 2030 2040

Renewables provide three-quarters of the growth in electricity supply to 2040 under stated policies but much more is needed: in Sustainable Development Scenario wind and solar capacity in 2040 is 50% higher

Total population by region Africa’s role in global energy growth, 2018-40 201820232040 Oil demand Natural gas demand Renewables generation

/d 4 400 3 000 bcm TWh mb Africa 1.5 3 300 1 500 Case Billion people

1 2 200 1 000

0.5 1 100 500

China India Africa India Africa China Middle China Middle AfricaIndia China India Africa European East East Union With rapidly rising population and a major switch away from the traditional use of biomass, Africa emerges as a major source of global growth for oil, natural gas and renewables

Change in energy-related CO2 emissions by region, 2018-2019

2 400 Mt CO

200

-200 European Union United States Japan Rest of World

New IEA data show global CO2 emissions were unchanged at 33 gigatonnes in 2019, even as the world economy expanded by 2.9%, mainly due to lower emissions from electricity generation

Energy-related CO2 emissions and reductions in the Sustainable Development Scenario by source

Current Trends Gt CO2 40 Stated Policies Scenario Industrial electric motors Buildings Power Light industry Cars & trucks Efficiency Heavy industry 30 Air conditioners Aviation and shipping Wind Solar PV Biofuels transport Renewables Other renewables power Other renewables end-uses 20 Hydro Nuclear Fuel switch incl. hydrogen Electric vehicles Fuel switch, CCUS CCUS power CCUS industry and other Behavioural change 10 Resource efficiency Sustainable Development Scenario

2010 2020 2030 2040 2050 A host of policies and technologies will be needed across every sector to keep climate targets within reach, and further technology innovation will be essential to aid the pursuit of a 1.5°C stabilisation

• The energy sector is adjusting to new pressures, but the overall response remains far from adequate in view of the energy security & environmental threats the world faces

• While solar, wind, storage & digital technologies are transforming the electricity sector, legacy issues surrounding existing infrastructure also need to be tackled

• Investment in energy efficiency, renewables and more flexible energy systems must significantly accelerate

• The oil & gas industry is critical for some key capital-intensive technologies to reach maturity, including CCUS, low-carbon hydrogen, biofuels, and offshore wind

• The IEA is convening, leading & supporting a Grand Coalition – made up of govts, industry & civil society – to accelerate global energy transitions that underpin energy security & economic growth