| The BP Energy Outlook 2030 is
the first of BP's forward-looking analyses to be published,
after 60 years of producing definitive historical data in
the BP Statistical Review of World Energy.
In launching the BP Energy Outlook 2030, Group Chief Executive
Bob Dudley said: "The issues covered in this document
are huge ones - the effort to provide energy to fuel the global
economy, sustainably, in an era of unprecedented growth. I
believe one of our responsibilities is to share the information
we have, to inform the debate on energy, and now on climate
change."
“What producers, governments and consumers all want
is secure, affordable and sustainable energy. But on a global
scale, this remains an aspiration. And to meet that aspiration
over the next two decades, we need smart, market-oriented
policies to deliver the energy we need in a manageable way
– without inhibiting economic development or jeopardising
the improvements in living standards now being experienced
by billions of people worldwide.”
“I need to emphasize that the BP Energy Outlook 2030
base case is a projection, not a proposition. It is our dispassionate
view of what we believe is most likely to happen on the basis
of the evidence. For example, we are not as optimistic as
others about progress in reducing carbon emissions. But that
doesn’t mean we oppose such progress. As you probably
know, BP has a 15-year record of calling for more action from
governments, including the wide application of a carbon price.
Our base case assumes that countries continue to make some
progress on addressing climate change, based on the current
and expected level of political commitment. But overall, for
me personally, it is a wake-up call.”
Highlights
BP’s ‘base case’ projections are that world
primary energy demand growth averages 1.7% per year from 2010
to 2030 although growth decelerates slightly beyond 2020.
Non-OECD energy consumption will be 68% higher by 2030 averaging
2.6% per year growth, and accounts for 93% of global energy
growth. In contrast, OECD growth averages 0.3% per year to
2030; and from 2020 OECD energy consumption per capita is
on a declining trend of -0.2% per year.
Transport growth is seen to slow because of a decline in
the OECD. The region's total demand for oil and other liquids
peaked in 2005 and will be back at roughly the level of 1990
by 2030. Toward the end of the period, coal demand in China
will no longer be rising and China is projected to become
the world's largest oil consumer.
OPEC’s share of global oil production is set to increase
to 46%, a position not seen since 1977. At the same time,
oil - and gas - import dependency in the US is likely to fall
to levels not seen since the 1990s, because of improved fuel
efficiency and the increased share of biofuels. Global consumption
growth is also impacted by higher oil prices in recent years
and a gradual reduction of subsidies in oil-importing countries.
The fuel mix changes over time, reflecting long asset lifetimes.
Oil, excluding bio-fuels, will grow relatively slowly at 0.6%
per year; natural gas is the fastest growing fossil fuel with
more than three times the projected growth rate of oil at
2.1% per year. Coal will increase by 1.2% per year and by
2030 it is likely to provide virtually as much energy as oil
excluding biofuels. The strong carbon policy drive in OECD
countries risks being more than offset by growth in emerging
economies.
Wind, solar, bio-fuels and other renewables continue to grow
strongly, increasing their share in primary energy from less
than 2% now to more than 6% projected by 2030. Biofuels will
provide 9% of transport fuels and nuclear and hydropower will
grow steadily and gain market share in total energy consumption.
“The slowing of growth in total energy in transport
is related to higher oil prices and improving fuel economy,
vehicle saturation in mature economies, and expected increases
in taxation and subsidy reduction in developing economies,”
said Rühl. “In percentage terms, oil demand is
reduced the most in the power sector (-30%) because this is
the easiest oil to displace with gas or renewables and is
the sector most likely to employ carbon pricing.”
Energy intensity .
Since 1900 the world's population has more than quadrupled,
real income (as measured by Gross Domestic Product) has grown
by a factor of 25, and primary energy consumption by a factor
of 23. "The modern energy economy has been shaped by
the trends of industrialisation, urbanisation, motorisation
and rising income levels," said Rühl.
Energy per unit of income as measured by GDP continues to
fall, and at an accelerating rate. "This is true in our
outlook to 2030 not only for the global average, but for almost
all of the key countries and regions. The combination of energy
efficiency gains and a long-term structural shift towards
less energy intensive activities as economies develop underpins
this trend," said Rühl.
Non-OECD growth . Global liquids demand is forecast to reach
102.4 million barrels per day (mmbpd) in 2030. The net growth
of 16.5 mmbpd over the next 20 years comes exclusively from
the emerging economies of the non-OECD. "Non-OECD Asia
will account for nearly two-thirds of non-OECD consumption
growth over the next 20 years and more than three-quarters
of the net global increase, rising by nearly 13 million barrels
a day," said Rühl.
“The largest increments of new supply will come from
OPEC – conventional crude in Saudi Arabia and Iraq,
as well as OPEC natural gas liquids (NGLs) which are not subject
to OPEC quotas.”
Non-OPEC liquids are likely to rise modestly, driven by a
large increase in biofuels, along with smaller increments
from Canadian oil sands, deepwater Brazil, and the FSU which
offset continued declines in mature provinces.
Fuel substitution
According to the Energy Outlook's projections, oil continues
to suffer a long run decline in market share, while gas steadily
gains share. Coal's recent gains in market share, on the back
of rapid industrialisation in China and India in particular,
are reversed by 2030, with all three fossil fuels converging
on market shares around 27%. The diversifying fuel mix can
be seen most clearly in terms of shares of growth. Over the
period 1990-2010 fossil fuels contributed 83% of the growth
in energy; over the next twenty years fossil fuels are likely
to contribute 64% of the growth. Renewables (excluding hydro)
and biofuels together account for 18% of the growth in energy
to 2030.
“The diversifying fuel mix is being driven largely
by developments in the power sector. Energy used to generate
power remains the fastest growing sector, accounting for 53%
of the growth in primary energy consumption 1990-2010 and
projected to account for 57% of the growth to 2030. In terms
of end use, industry drives the growth of final energy consumption.
The role of transport is weakening; over the past 20 years
transport sector energy demand grew at about the same rate
as total energy demand, but over the next 20 years it grows
much less rapidly than total energy,” said Rühl.
“OECD oil demand declines are concentrated primarily
outside the transport sector, where it is relatively easier
to displace oil by gas and renewables; post-2015, OECD transport
demand is also expected to fall as technology and policy drive
improved engine efficiency.”
Growth in biofuels
Biofuels production is expected to reach 6.7 mmbpd by 2030
from 1.8 mmbpd in 2010 and will contribute 125% of net non-OPEC
supply growth over the next 20 years. Continued policy support,
high oil prices, and continued technological innovations all
contribute to the rapid expansion.
The US and Brazil will continue to dominate biofuel production
with 76% of total output in 2010 but falling to 68% in 2030
as output from Asia-Pacific begins to rise.
“The global fuel mix continues to diversify –
but for the first time, non-fossil fuels will be major sources
of supply growth,” said Rühl.
Environmental policy
The Energy Outlook 2030 assumes continued policy action to
address concerns about both climate change and energy security,
based on the current trend of political commitment. BP has
developed an alternative 'policy case' to explore the implications
of a significant increase in the level of political commitment
which translates into a tightening of policy.
“The key focus of the policy case is to reduce dependence
on carbon intensive fuels. This can be achieved through a
wide range of policy instruments, including various ways of
putting a price on carbon,” said Rühl.
In BP’s policy case “global emissions peak just
after 2020, but will still be 20% above 2005 levels. The emissions
path is still expected to be well above the International
Energy Agency’s 450 Scenario1 , indicating how much
more effort will be required after 2030 to put the world onto
a ‘safe’ path,” said Rühl.
The cut in emissions in the policy case would be achieved
through a combination of more rapid efficiency gains, fuel
switching - from coal to gas and from fossil fuels to nuclear,
hydro and renewables - and the introduction of carbon capture
and storage (CCS) for both coal and gas power plants.
Note to editors:
The BP Energy Outlook 2030 is available online at www.bp.com/Energyoutlook2030.
Cautionary statement
This presentation contains forward-looking statements, particularly
those regarding global economic growth, population growth,
energy consumption, policy support for renewable energies
and sources of energy supply. Forward-looking statements involve
risks and uncertainties because they relate to events, and
depend on circumstances, that will or may occur in the future.
Actual results may differ depending on a variety of factors,
including product supply, demand and pricing; political stability;
general economic conditions; legal and regulatory developments;
availability of new technologies; natural disasters and adverse
weather conditions; wars and acts of terrorism or sabotage;
and other factors discussed elsewhere in this presentation.
Source: BP group ( www.bp.com )
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