Jump in Energy Demand Seen by 2035
By JULIA WERDIGIER
Published: November 9, 2010
LONDON — World energy demand will grow by more than a third over the next 25 years, led by increased consumption in China, and fossil fuels will still be the main source, an influential forecasting agency said Tuesday.
In its annual World Energy Outlook, the International Energy Agency said that demand would increase by 36 percent by 2035. Even though renewable energy sources are set to increase in importance, oil, coal and natural gas would remain the main sources of energy in 2035, according to the intergovernmental agency, which is based in Paris and advises industrialized countries.
“It is hard to overstate the growing importance of China in global energy markets,” the I.E.A. added in its annual report. “The country’s growing need to import fossil fuels to meet its rising domestic demand will have an increasingly large impact on international markets.”
The agency reported in July that China overtook the United States as the world’s largest energy user last year, although Beijing disputed the finding.
The I.E.A. also said that the world energy outlook in 2035 hinged critically on government policies and how their actions affect technology, the price of energy services and consumer behavior. The I.E.A. said it based its outlook on governments sticking to their commitments to reduce greenhouse gas emissions and to phase out subsidies for fossil fuels.
Oil is expected to remain the dominant fuel while demand for coal is expected to rise until about 2020, the agency said. Demand for natural gas is to “resume its long-term upward trajectory from 2010” after a drop in 2009 because of the recession, and would be especially strong from China and the Middle East, it said.
China is expected to continue to drive growth in energy demand overall as its industrial production increases and its population grows. Demand for energy in China is expected to rise 75 percent until 2035 and by that time, China would account for 22 percent of the world’s energy demand, up from currently 17 percent.
The I.E.A. also predicted a higher oil price over the next decades as demand continues to grow while constraints on investments remain. It expects oil prices to reach $113 per barrel in 2035 from just over $60 per barrel in 2009. In the short-term, the agency expects price volatility to “remain high,” it said.
The oil price would also depend on plans by oil companies to go after resources that are more difficult and more expensive to explore, such as Canadian oil sands projects. The agency also mentioned the Caspian region as a potentially large source for oil and natural gas but one where the investment climate and infrastructure remain a challenge.
Whether demand for oil would peak in that period depends on how vigorously governments push through new rules to encourage the use of alternative energy sources and a more efficient use of oil.
Renewable energy sources “will have to play a central role in moving the world onto a more secure, reliable and sustainable energy path,” the I.E.A. said. Renewable energy sources could see their share of global electricity generation increase to almost 33 percent by 2035 from 19 percent in 2008.
Demand for renewable energy sources would increase together with the price of oil but would also hinge on growing government support. The I.E.A. estimated that government support would rise to $205 billion, or 0.17 percent of gross domestic product, by 2035 from $75 billion in 2009.
sourced : NY Times