The world is heading for an “insecure, inefficient and high carbon energy system” by 2035 unless major changes take place, according to the International Energy Agency’s 2011 World Energy Outlook report.
The economy, the nuclear accident at the Fukushima Daiichi plant in Japan in March and the security of oil and gas supply from the Middle East and North Africa are behind challenges and uncertainty to the future of energy globally. With carbon dioxide (CO2) emissions rising in recent years and a worsening in energy efficiency performance, trends are pointing in “worrying directions,” the outlook said.
"Growth, prosperity and rising population will inevitably push up energy needs over the coming decades,” said IEA Executive director Maria van der Hoeven. “But we cannot continue to rely on insecure and environmentally unsustainable uses of energy. Governments need to introduce stronger measures to drive investment in efficient and low-carbon technologies."
The report makes its predictions based on the analysis of three global energy scenarios:
- The New Policies Scenario assumes that current energy policy commitments are implemented cautiously over the coming years, leading to a global temperature rise of 3.5°C (38.3 F) compared to pre-industrial levels.
- The Current Polices Scenario assumes no new polices are added to those as of mid-2011, resulting in an increase in CO2 emissions and a global temperature rise of over 6°C (42.8 F).
- The 450 Scenario starts with the target of trying to restrict a global temperature rise to less than 2°C (35.6 F) and implements the measures needed to meet this.
However, the report said that it is becoming less likely that the world can feasibly achieve the 450 Scenario as four-fifths of the total energy-related CO2 emissions permitted by the scenario are already locked-in by existing energy and efficiency. For every $1 of investment not made in low carbon investment prior to 2020, $4.30 will need to be made after this date to achieve the same result.
The report said if nuclear energy supply were halved, it will prove more expensive and much harder to tackle climate change. While renewable energy sources would receive a boost if this happens, the end result would see an increase in the use of coal and gas and a net 6.2 percent increase in global CO2 emissions compared to the New Policies Scenario.
Under the New Policies Scenario, global energy demand is set to rise by one-third between 2010 and 2035. All forms of primary energy production increase, with renewable energy and gas showing the largest growth, but nuclear generation also increasing by about 70 percent from current levels.
Fossil fuels are expected to contribute less to the share of primary energy, from 81 percent in 2010 to 75 percent in 2035, but there is still a net increase in overall consumption. The U.S. and Canada are two out of five countries expected to enter a so-called golden age in natural gas with increases in production and tapping into unconventional resources such as shale gas.
The future of renewable energy deployment remains heavily conditional on increasing subsidies, with global subsidies of $66 billion per year needing to climb to $250 billion per year if renewable targets are to be met. Rising deployment outweighs any advantage brought about by improved competitiveness.
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