In our Reference Scenario, world primary energy demand grows by 1.6% per year on average in 2006-2030, from 11 730 Mtoe to just over 17 010 Mtoe — an increase of 45%.
To illustrate the course on which we are set, this scenario embodies the effects of those government policies and measures that were enacted or adopted up to mid-2008, but not new ones. This provides a baseline against which we can quantify the extent to which we need to change course. Demand grows at a slower rate than projected in WEO-2007, mainly due to higher energy prices and slower economic growth, especially in OECD countries. Fossil fuels account for 80% of the world’s primary energy mix in 2030 — down slightly on today. Oil remains the dominant fuel, though demand for coal rises more than demand for any other fuel in absolute terms. The share of the world’s energy consumed in cities — an estimated 7 900 Mtoe in 2006 — grows from two-thirds to almost three-quarters in 2030. Due to continuing strong economic growth, China and India account for just over half of the increase in world primary energy demand between 2006 and 2030. Middle East countries strengthen their position as an important demand centre, contributing a further 11% to incremental world demand. Collectively, non-OECD countries account for 87% of the increase. As a result, their share of world primary energy demand rises from 51% to 62%. Their energy consumption overtook that of the OECD in 2005. Global primary demand for oil (excluding biofuels) rises by 1% per year on average, from 85 million barrels per day in 2007 to 106 mb/d in 2030. However, its share of world energy use drops, from 34% to 30%. Oil demand in 2030 has been revised downwards by 10 mb/d since last year’s Outlook, reflecting mainly the impact of much higher prices and slightly slower GDP growth, as well as new government policies introduced in the past year. All of the projected increase in world oil demand comes from non-OECD countries (over four-fifths from China, India and the Middle East); OECD oil demand falls slightly, due largely to declining non-transport oil demand. Global demand for natural gas grows more quickly, by 1.8% per year, its share in total energy demand rising marginally, to 22%. Most of the growth in gas use comes from the power-generation sector. World demand for coal advances by 2% a year on average, its share in global energy demand climbing from 26% in 2006 to 29% in 2030. Some 85% of the increase in global coal consumption comes from the power sector in China and India. The share of nuclear power in primary energy demand edges down over the Outlook period, from 6% today to 5% in 2030 (its share of electricity output drops from 15% to 10%), reflecting the consistency of our rule not to anticipate changes in national policies — notwithstanding a recent revival of interest in nuclear power. Nuclear output nonetheless increases in absolute terms in all major regions except OECD Europe. Modern renewable technologies grow most rapidly, overtaking gas to become the second-largest source of electricity, behind coal, soon after 2010. Falling costs as renewable technologies mature, assumed higher fossil-fuel prices and strong policy support provide an opportunity for the renewable industry to eliminate its reliance on subsidies and to bring emerging technologies into the mainstream. Excluding biomass, non-hydro renewable energy sources — wind, solar, geothermal, tide and wave energy — together grow faster than any other source worldwide, at an average rate of 7.2% per year over the projection period. Most of the increase occurs in the power sector. The share of non-hydro renewables in total power generation grows from 1% in 2006 to 4% in 2030. Hydropower output increases, though its share of electricity drops two percentage points to 14%. In the OECD, the increase in renewables-based power generation exceeds that in fossil-based and nuclear power generation combined.