WORLD ENERGY OUTLOOK 2002 Focus on European Union François Cattier International Energy Agency Il Mercato Europeo Del Gas Naturale 26 September 2002

Outline WEO 2002 will be officially launched mid-October in Rome EU projections Energy market trends Implications for CO2 emissions Results of the Alternative Scenario Key messages & conclusions

Share of EU in World Primary Energy Demand 2000 2030 9,200 Mtoe 15,300 Mtoe The EU’s share of world energy demand falls as demand grows faster in developing countries

EU Primary Energy Mix 2000 2030 1,456 Mtoe 1,811 Mtoe Gas & renewables increase their shares in the EU energy mix, at the expense of nuclear power, coal and oil

EU Total Final Energy Consumption Transport remains the fastest-growing end-use sector

EU Electricity Generation Gas captures most of the increase in power-generation fuel needs, but the role of renewables increases rapidly

EU Oil Balance Oil imports rise as demand continues to grow & North Sea production starts to decline

European Union Gas Demand

EU Net Imports of Gas by Origin 2000 2030 187 bcm 632 bcm The Middle East & to a lesser extent Latin America become major new suppliers of gas to the EU

EU Gas-Supply Costs: North Indicative Costs for New Sources of Gas Supply Delivered to the German Border, 2010 ($/Mbtu) Russian gas from Nadym Pur Taz is the cheapest near-term option for supply to Northern EU countries..

EU Gas-Supply Costs: South Indicative Costs for New Sources of Gas Supply Delivered to the Mediterranean, 2010 ($/Mbtu) While North African gas is the cheapest near-term option for supply to Mediterranean EU countries

Net Gas-Trade Flows, 2030 Bcm The Middle East overtakes the transition economies as the world’s biggest gas-exporting region

EU CO2 Emissions Emissions fall more than energy use, because of the added impact of fuel switching to less carbon-intensive fuels 1980 1990 2000 2010 2020 2030 Emissions in the Alternative Scenario stabilise towards the end of the projection period

Conclusions EU Energy use will continue to grow Renewables will penetrate energy mix rapidly, but fossil fuels will still dominate Oil and gas imports will surge CO2 emissions are set to grow even faster than energy use – without new policies New policies now being considering would save energy & stabilise emissions, but only towards the end of the Outlook period

Implications for EU Energy Security To ensure energy security, governments will need to: take a more proactive role in dealing with energy-security risks pay more attention to maintaining the security of international sea-lanes and pipelines promote diversification of the mix of fuels & their geographic sources Co-operate with supplier countries to facilitate investment

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