1. Energy and Climate Outlook
Dr. Fatih Birol
Chief Economist
International Energy Agency

2. The Reference Scenario: World Primary Energy Demand
18 000
Other renewables
Nuclear
16 000
Biomass
14 000
Gas
12 000
10 000
Mtoe
8 000
Coal
6 000
4 000
Oil
2 000
1970
1980
1990
2000
2010
2020
2030
Global demand grows by more than half over the next quarter of a century, with coal use rising most in absolute terms

3. Reference Scenario: Increase in World Oil Supply, 2004-203025 20
Other 15
mb/d
Iran 10
Iraq 5
S.Arabia
OPEC conventional
Non-conventional
Non-OPEC
conventional
The share of OPEC in world oil supply increases sharply as conventional non-OPEC production peaks towards the middle of next decade

4. Proven Natural Gas Reserves
Gas reserves are concentrated in FSU and MENA regions – Russia and Iran together account almost half of global gas reserves

5. Annual Increase in Coal Demand
-100
100
200
300
400
500
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
China
Rest of the world
million tonnes
Global coal demand in the recent years has grown much faster than previously – mainly driven by China

6. Reference Scenario: Increase in Power Sector CO2 Emissions by Fuel, 2005-2030
- 500
500
1 000
1 500
2 000
2 500
3 000
3 500
OECD
Transition
economies
China
India
Rest of
developing
countries
million tonnes
Coal
Oil
Gas
China and India account for almost 60% of the increase in power sector CO2 emissions to 2030

7. Reference Scenario: Energy-Related CO2 emissions by Region15
Rest of non-OECD 12 2
China
Rest of OECD 9
Gigatonnes of CO 6
United States 3
1990
2000
2010
2020
2030
China to overtake US as the world’s biggest emitter, though OECD countries bear a major responsibility as to cumulative carbon concentration

8. CO2 Emissions Growth
6 000 14
2004
2030 12
5 000 10
4 000 8
2004
2030
million tonnes
3 000
tonnes per capita 6
2 000 4
1 000
2004
2030 2
China
India
OECD
Emissions growth in China is twice as large as in the OECD, but in 2030 per capita emissions will still be lower than current OECD ones

9. The Next Ten Years Will Determine Our Energy Future
Investment over the next decade will lock in technology for up to 60 years
China and India - growing at breakneck speed fueled by energy
OECD power plants – significant portion reaching to retirement
Security of supply is under threat because the balance of power is shifting
Oil production in non-OPEC countries is set to peak,
Gas production to peak in OECD

10. Alternative Policy Scenario

11. Alternative Policy Scenario
The Alternative Policy Scenario: Key Policies for Global CO2 Reduction 42
Increased nuclear (10%)
Increased renewables (12%)
Power sector efficiency & fuel (13%) 38
Electricity end-use efficiency (29%)
Reference Scenario
Fossil-fuel end-use efficiency (36%)
Gt of CO2 34 30
Alternative Policy Scenario 26
2004
2010
2015
2020
2025
2030
Improved end-use efficiency accounts for over two-thirds of avoided emissions in 2030 in the APS

12. The Alternative Policy Scenario : Key policies that Make a Global Difference
Energy efficiency
Power generation US
Tighter CAFE standards
Improved efficiency in residential & commercial sectors
Increased use of renewables EU
Increased vehicle fuel economy
Improved efficiency in electricity use in the commercial sector
Nuclear plant lifetime extensions
China
Improved efficiency in electricity use in industry
Improved efficiency in electricity use in the residential sector
Increased efficiency of coal-fired plants
Increased reliance on nuclear
A dozen policies in the US, EU & China account for around 40% of the global emissions reduction in 2030 in the Alternative Policy Scenario

13. Focus on European Union: Electricity Investment, 2005-2030
-500
-400
-300
-200
-100
100
200
300
billion dollars (2005)
Additional demand-side investment
Avoided supply-side investment
Net change in electricity investment
Investment needs are $139 billion lower over the projection period

14. Some concluding thoughts…
The Reference Scenario projects a vulnerable, dirty and expensive global energy system
Demand side efficiency – “ easier “ with large potential
Large-hydro and nuclear - important parts of the solution
Numbers speak for themselves : no sustainable/meaningful solution to climate change problem without having China and India on board
Strong political will and urgent government action is needed to create clear incentives to change existing investment patterns