NGI The Weekly Gas Market Report / NGI All News Access

World Energy Use to Increase 56% by 2040, NatGas by 64%

July 29, 2013
/ Print
| Share More
/ Text Size+

World energy consumption will increase by 56% between 2010 and 2040, driven largely by increased demand from developing countries, according to the International Energy Outlook 2013 (IEO2013), which was released last Thursday by the Energy Information Administration (EIA). It sees global natural gas demand increasing by 64%.

World energy consumption is projected to grow from 524 quadrillion Btu in 2010 to 630 quadrillion Btu in 2020 and 820 quadrillion Btu in 2040. At that point fossil fuels will supply nearly 80% of the world's energy, with liquid fuels (including biofuels) providing 28%, coal 27% and natural gas 23%. Renewables will rise from 11% currently to 15% and nuclear energy from 5% to 7%.

Much of the growth in energy demand during the period will occur in countries outside the 34-member Organization for Economic Cooperation and Development (OECD), such as China and India, according to the EIA. Energy use in non-OECD countries is expected to rise by 90%, while the rise in OECD countries will be more modest under the IEO2013 reference case.

Renewable energy and nuclear power will lead the growth in energy demand in the reference case, each increasing by 2.5% per year, according to the outlook. Natural gas is projected to be the fastest-growing fossil fuel.

Global natural gas demand is likely to rise by 1.7% a year, according to the EIA outlook. The agency based its projection on the increasing supplies of tight gas, shale gas and coalbed methane. Coal use grows faster than petroleum and other liquid fuel use until after 2030, mostly because of increases in China's consumption of coal and tepid growth in liquids demand. The world industrial sector will account for more than half of the global delivered energy in 2040, making it the largest energy consumer, closely followed by the transportation sector.

The EIA outlook projects that world natural gas consumption will increase by 64% in the reference case from 113 Tcf in 2010 to 157.2 Tcf in 2020 to185 Tcf in 2040. "Natural gas continues to be the fuel of choice for the electric power and industrial sectors in many of the world's regions, in part because of its lower carbon intensity compared with coal and oil, which makes it an attractive fuel source in countries where governments are implementing policies to reduce greenhouse gas emission," the outlook said.

According to the reference case, the United States will lag other counties in gas production increases through 2040. The largest increase in natural gas production is expected to occur in non-OECD Europe and Eurasia (18.9 Tcf), the OECD Americas (15.9 Tcf) and the Middle East (15.6 Tcf), while the U.S. and Russia each are expected to increase gas production by around 12 Tcf. Combined, the United States and Russia would account for nearly one-third of the total increase in world gas production, the outlook said.

Shale gas will account for half of U.S. natural gas production in 2040, the EIA projected. It anticipates that the global trading of liquefied natural gas will more than double from about 10 Tcf in 2010 to around 20 Tcf in 2040. "Most of the increase in liquefaction capacity is in Australia and North America (the United States and Canada), where a multitude of new liquefaction projects are expected to be developed, many of which will become operational within the next decade," EIA said. "At the same time, existing facilities in North America and Southeast Asia have been underutilized or are shutting down as a result of production decline at old fields associated with the liquefaction facilities."

World coal consumption is projected to rise at an average rate of 1.3% annually from 147 quadrillion Btu in 2010 to 180 quadrillion in 2020 to 220 quadrillion Btu in 2040. "The near-term expansion of coal consumption reflects significant increases in China, India and other non-OECD countries. In the longer term, growth of coal consumption is likely to decelerate as policies and regulations encourage the use of cleaner energy sources, natural gas becomes more economically competitive as a result of shale gas development, and growth of industrial use of coal slows, largely as a result of China's industrial activities."

©Copyright 2013 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1266
Comments powered by Disqus