Published: July 7th, 2016
World demand for oil and gas will continue to increase during the next 20 years even while the use of renewable energy increases dramatically during the same period. Those who are pushing mankind to take dramatic steps to reduce the use of fossil fuels more rapidly and accelerate the use of renewables more rapidly should read the recently released 2016 edition of the BP Energy Outlook for a reality check.
While this demand forecast is good news for our beleaguered Canadian oil and gas industry, it’s not good news for those concerned about climate change.
Increasing per-capita energy consumption
The BP report indicates that no matter how desirable a shift to renewables may be, there is a limit to the speed at which the shift away from fossil fuels will occur. Billions of people in the third world are increasing their per-capita energy consumption as illustrated through a dramatic increase in Non-OECD carbon emissions at right. That energy consumption increase is overwhelming all efforts by the people of the first world to become more energy efficient and use more renewables to combat climate change as illustrated through a modest reduction in OECD carbon emissions at right. This trend of net increasing energy consumption is likely to continue for at least a generation.
Making lifestyle changes to reduce energy consumption
I’m all in favor of reducing energy consumption per capita, using energy more efficiently and relying on more renewables for energy production. These worthwhile goals require billions of people to make lifestyle changes that most have shown great reluctance to make. These lifestyle changes include:
- Driving fewer kilometers using smaller, more efficient cars with less horsepower.
- Using public transportation more.
- Living in smaller, better insulated homes that can generate at least part of their energy requirement.
- Living in higher-density cities consisting of more multi-family structures and fewer single family homes.
I think the BP Energy Outlook report says we’re making small progress, as a planet, to address the adverse impacts of fossil fuels that include climate change and pollution. We’ve managed to decrease in the rate of energy consumption growth as illustrated below. It’s difficult to conceive of a more rapid transition without consumer willingness to accept:
- Tax increases for consuming fossil fuels.
- Significant increases in investments to improve energy consumption efficiency.
Increasing Consumption of Oil
The reality is that the projected demand for oil as a transportation fuel will outstrip the projected increases in alternatives such as the use of public transportation, natural gas as a fuel and efficiency improvements as shown below left. This demand for oil will be driven by a global vehicle fleet that will more than double in size during the next 20 years as shown below right.
Increasing Use of Renewables
I’m excited by the projected increase in the use of renewables and a decrease in the use of oil as a source of energy during the next 20 years as illustrated below from the BP report. However, the increase in the use of renewables will only reach about 10% of total energy usage. Similarly, while the use of oil will decrease to 30% of energy usage, the total volume of oil consumed will continue to increase.
I’m excited by the forecasters repeatedly under-estimating the amount of renewable power that will become available as illustrated below. If that trend continues the use of renewables will surpass 10% of total energy usage by 2035.
Can you share your ideas for how we can reduce our consumption of fossil fuels and thereby reduce their environmental impact? For more information visit BP Energy’s Statistical Review of World Energy
Read more insightful analysis from Yogi here.