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                          International and Political Terms     

World energy use keeps rising

 Energy is above all an economic subject but one with significant political implications. One need only revisit the energy shock of 1973 when the Arab oil embargo was imposed or the strategic considerations mentioned in connection with the 1990 Gulf War and the invasion of Iraq. Next to food and water, energy is of critical political importance--for supplier as well as for consumer. We have not reached the point of imminent resource wars, a subject that is rising to the foreground in public discussion, but related issues of conservation, climate change, and global warming are sharpening international debates.

The demand for world energy is not shrinking but growing. The Energy Information Administration (EIA) of the US Department of Energy projects* that world energy consumption is increasing by 57 percent from 2004 to 2030 (54 percent from 2001 to 2025). The largest projected increase in energy demand is for the region outside the Organization of Economic Cooperation and Development (OECD) or the industrial countries. Here energy consumption is projected to grow at an average annual rate of 2.6 percent from 2004 through 2030, compared to 0.8 percent in the OECD region. Worldwide, total energy use is projected to grow from 447 quadrillion British thermal units (Btu) in 2004 to 702 quadrillion Btu in 2030.

Petroleum demand is projected to increase from 83 million barrels a day in 2004 to 118 million barrels a day in 2030. The United States, China, and other nations of developing Asia are expected again to account for the bulk in the growth in demand.

The demand for natural gas is increased by rising world oil prices. Over the 2004-2030 forecast period, consumption of natural gas is projected to increase from 100 trillion cubic feet (Tcf) in 2004 to 163 trillion cubic feet in 2030. Natural gas is used to displace the use of liquids in the industrial and electric power sectors in many parts of the world. It is both a more efficient fuel for electric power generation and less carbon intensive than other fossil fuels, and as a result it is an attractive energy source for the world’s power generation. It is the world’s fastest-growing energy source for electricity generation in the current projection.

World coal consumption is growing and is expected to increase its share of world energy consumption from 26 percent in 2004 to 28 percent in 2030. Coal use worldwide will increase by 37 quadrillion Btu from 2004 to 48 quadrillion Btu in 2030. In particular, the United States, China, and India are well-positioned to displace more expensive fuels with coal, and together the three nations account for 86 percent of the expected increase from 2004 to 2030. Decreases in coal consumption are projected only for OECD Europe and Japan, where population growth is slow or declining, electricity demand growth is slow, and natural gas and nuclear power are likely to continue providing significant amounts of electricity. 

Electricity use is forecast to grow from 16,424 kilowatthours in 2004 to 30,364 billion kilowatthours, nearly double the 2004 total. The strongest growth in net electricity consumption is projected for the non-OECD region, averaging 3.5 percent a year, and 1.3 percent a year in OECD nations over the projection period.

Nuclear electricity generation is projected to increase 1.3 percent annually,  from 2,619 billion kilowatthours in 2004 to 3,619 billion kilowatthours in 2030.  The largest increase in installed nuclear generating capacity is projected for non-OECD Asia, which accounts for 68 percent of the total projected increase in nuclear power capacity for the non-OECD region as a whole. Of the 58 gigawatts of additional installed nuclear generating capacity projected for non-OECD Asia between 2004 and 2030, 36 gigawatts is projected for China and 17 gigawatts for India. Russia also is expected to add substantial nuclear generating capacity over the mid-term projection, increasing capacity by 20 gigawatts. Several OECD nations with existing nuclear programs also increase their nuclear capacity, with Korea (ROK) adding a net 16 gigawatts, Japan 14 gigawatts, the United States 13 gigawatts, and Canada 6 gigawatts. 

Carbon dioxide emissions are projected to rise from 26.9 billion metric tons in 2004 to 42.9 billion metric tons in 2030. In 2004, non-OECD emissions of carbon dioxide were greater than OECD emissions for the first time. In 2030, carbon dioxide emissions from the non-OECD countries are projected to exceed those from the OECD countries by 57 percent.

Carbon dioxide is the most abundant  greenhouse gas in the atmosphere caused by humans. In recent years, atmospheric concentrations of carbon dioxide have been rising at a rate of about 0.5 percent a year, and because anthropogenic emissions of carbon dioxide result primarily from the combustion of fossil fuels for energy, world energy use has emerged at the center of the climate change debate.

*International Energy Outlook 2007, Energy Information Administration. Washington DC: US Department of Energy, May 2007.

(IO 444 June 2007)