Monday, July 22, 2019

Energy Consumption 2050

Energy Consumption 2050

Nearly half the world’s electricity will come from renewable energy by 2050 as costs of wind, solar and battery storage continue to plummet. That titanic shift over the next three decades will come as electricity demand increases 62% and investors pump $13.3 trillion into new projects. 

The move away from fossil fuel has sweeping implications for energy markets and the fight to stave off climate change. Wind, solar and batteries are poised to enable the power sector to meet its share of emission cuts required under the Paris climate agreement, at least until 2030.
But after that, nations will need other technologies to make deeper cuts at a reasonable cost.
By 2050, solar and wind will supply almost 50% of the world’s electricity, with hydro, nuclear and other renewable energy resources providing another 21%. Coal will be the biggest loser in the power sector, with its share of global generation plunging from 37% today to 12% in 2050. Many nations can cut power-sector emissions through 2030 in line with goals set in Paris to limit the increase in world temperatures to 2 degrees Celsius (3.6 degrees Fahrenheit). And they can do that without additional subsidies for solar and wind. Since 2010, the cost of wind power has dropped by 49%, and solar has plummeted 85%. That makes them cheaper than new coal or gas plants in two-thirds of the world. Battery storage costs, meanwhile, have dropped 85% since 2010. If the world is to completely eliminate greenhouse gas emissions from the electricity sector, technologies including carbon capture and storage, hydrogen power and solar thermal plants will compete to provide about 13,000 terawatt hours of generation by 2050. That’s equivalent to about half of all electricity produced today. And even if every nation scrubs emissions from the power sector, there are still ample greenhouse gases from cars, trucks, ships, airplanes, heating systems and agriculture.

The rise in energy demand is essentially a story of economic and population growth. Primary energy consumption—which encompasses virtually all demand, right down to the losses of energy as it travels across transmission and distribution lines—has boomed in developing parts of the world, even as it leveled off, or even fell, in industrialized countries.

As a result, the global balance of energy demand has shifted dramatically since 1980. Back then, the U.S. consumed over a quarter of the world’s energy—more than any other country. Today, it’s China that uses the most. The U.S. is still a close second. Other large, emerging economies like India and Indonesia are consuming four, five, and in some cases, even six times the primary energy they did in 1980—most of it coming from fossil fuels spewing the carbon-dioxide emissions now threatening the earth’s climate. In other parts of the world, clean energy sources are taking off. Renewable, nuclear and other non-fossil-fuel sources made up more than 14% of the globe’s primary energy consumption in 2016. They make up an even larger share of its “final” energy use—demand after transformation and distribution losses—because fossil fuels lose more. The rise of cheap solar and wind power is helping slow the growth of carbon emissions globally—so is the decline in overall energy demand in developed nations. A recent McKinsey report projected that energy demand would plateau around 2030—thanks in large part to wealthy nations such as the U.S., Germany and Japan. Meanwhile, the number of countries that solely consume fossil fuels including coal and oil has dropped by about half to 17 since 1980, according to U.S. Energy Information Administration (EIA) data.

The shift away from fossil fuels, however, has faced setbacks. Nuclear power plants, despite the zero-emissions electricity they produce, have fallen out of favor in some parts because of Japan’s Fukushima disaster in 2011. And while the use of renewables is growing, their adoption may not prove quick enough to ward off the worst effects of global warming. Even if the nearly 200 countries that signed the Paris climate accord were on track to meet their own emission goals, global temperatures would still climb more than 2 degrees Celsius (3.6 degrees Fahrenheit)—a rise that scientists expect will be catastrophic to life on earth.

Every country has a different energy story: While energy consumption in most advanced economies has either stabilized or fallen in the past couple of decades, demand in many emerging markets has soared. The U.S. and China, the world’s two largest consumers of energy, are a case in point. China overtook the U.S. as the world’s largest energy consumer a decade ago. Cheap and dirty coal plants proliferated there, spewing so much soot that the sun was clouded out and cities were choking by the early 1990s. Within the past decade, the country has been working on a plan to curb its fossil-fuel pollution. One major part of that plan, the $36 billion Three Gorges dam, was completed in 2012, becoming the largest hydroelectric plant in the world at 22.5 gigawatts. The U.S., meanwhile, has seen its energy demand plateau. That’s even as its reliance on natural gas has grown rapidly thanks to a domestic fracking boom. U.S. monthly electricity generation from renewables surpassed coal for the first time in April 2019, according to the EIA.

In Europe, the U.K. and France are actually decreasing energy consumption. France became one of the smallest users of fossil fuels after the Arab oil embargo in the 1970s led to a rapid expansion of nuclear power. French utility EDF gets more of its electricity from emissions-free nuclear power than any other source and has committed to extending the life for most of its reactors even as others pull back in the wake of the Fukushima disaster. The consumption of once-dominant coal in the U.K. shrank to nearly zero in 2016, as the country plans to close all coal plants by 2025. The U.K. closed its last three deep mines in 2015, which led to a sharp drop in coal consumption for the country that launched the Industrial Revolution on the fossil fuel. The country has instead invested heavily in offshore wind farms. 
Japan’s consumption began falling around the turn of the century as efficiency gains and a shrinking population reduced the country’s needs, while Germany’s decline has been slower. Both countries were early proponents of nuclear power but are dismantling reactors because of safety concerns after a tsunami overwhelmed Japan’s Fukushima Daiichi plant in 2011. Germany, an early investor in clean energy, turned to renewables. Unlike Japan, Germany hasn’t seen a major increase in its share of fossil fuels as it shuts down its nuclear fleet ahead of Chancellor Angela Merkel’s 2022 deadline. But phasing out nuclear energy means that Germany’s carbon emissions have stayed steady, even as the country rapidly turns to renewables. 

Like China, India has seen breakneck development since 1980 and the accompanying surge in energy consumption that comes as tens of millions of its citizens join the country’s middle class. But unlike China, India has not invested as much in renewable energy as it’s developed. While a greater share of India’s total energy consumption came from non-fossil fuel sources in 1980 than its larger neighbor did, that share has actually dropped since 1980. Meanwhile, China’s share coming from nuclear and renewables has nearly quadrupled.
South Korea’s energy use also has grown rapidly. Because it must import most of its fuel supplies and has little land available for giant wind or solar farms, South Korea has embraced hydrogen fuel cell technologies to become the largest producer of fuel cell equipment. Energy mix and carbon footprint reveal a lot about a country’s natural resources. Take Iceland, which takes heat from the volcanoes that built the island nation and gets the rest of its electricity from hydroelectric dams. 
Others like Brazil, Paraguay, Bhutan, Croatia and Norway are also geographically blessed with enormous hydroelectric and renewable energy potential. That’s not so for arid regions such as the Middle East—Saudi Arabia generates most of its electricity from oil. 

The shift toward renewables has proven easier for some countries than others, but the economics of wind and solar are tipping the scales globally. The two resources are now the cheapest forms of energy in two-thirds of the world. The cost of solar has declined by 85% since 2010. As clean power sources get even cheaper, countries will have a greater incentive to transition and cut carbon emissions. Whether that comes in time to to prevent the worst effects of climate change remains to be seen.

Sunday, July 7, 2019

Renewable Energy Africa

 Sub-Saharan Africa is rich in energy resources.
Making reliable and afordable energy widely available is critcal to the development of a region that accounts for 13% of the world’s populaton, but only 4% of its energy demand. Since 2000, sub-Saharan Africa has seen rapid economic growth and energy use has risen by 45%. Many governments are now intensifying their eforts to tackle the numerous regulatory and politcal barriers that are holding back investment in domestc energy supply, but inadequate energy infrastructure risks putng a brake on urgently needed improvements in living standards. The picture varies widely across the region, but, in sub-Saharan Africa as a whole, only 290 million out of 915 million people have access to electricity and the total number without access is rising. Eforts to promote electrifcaton are gaining momentum, but are outpaced by populaton growth. Although investment in new energy supply is on the rise, two out of every three dollars put into the sub-Saharan energy sector since 2000 have been commited to the development of resources for export.

A severe shortage of essental electricity infrastructure is undermining eforts to achieve more rapid social and economic development. For the minority that has a grid connecton today, supply is ofen unreliable, necessitatng widespread and costly private use of back-up generators running on diesel or gasoline. Electricity tarifs are, in many cases, among the highest in the world and, outside South Africa, losses in poorly maintained transmission and distributon networks are double the world average. Reform programmes are startng to improve efciency and to bring in new capital, including from private investors, and grid-based generaton capacity quadruples in our main scenario to 2040, albeit from a very low base of 90 GW today (half of which is in South Africa). Urban areas experience the largest improvement in the coverage and reliability of centralised electricity supply. Elsewhere, mini-grid and of-grid systems provide electricity to 70% of those gaining access in rural areas. Building on successful examples of electrifcaton programmes, such as those in Ghana and Rwanda, the total number without access starts to decline in the 2020s and 950 million people gain access to electricity by 2040 – a major step forward, but not enough. More than half a billion people, mainly in rural areas, remain without electricity in 2040.

Sub-Saharan Africa starts to unlock its vast renewable energy resources, with almost half of the growth in electricity generaton to 2040 coming from renewables. Hydropower accounts for one-ffh of today’s power supply, but less than 10% of the estmated technical potental has been utlised. The Democratc Republic of Congo, where only 9% of the populaton has access to electricity, is an example of the co-existence of huge hydropower potental with extreme energy poverty. Politcal instability, limited access to fnance, small market size and weak transmission connectons with neighbouring countries have all held back exploitaton of hydro resources. These constraints are gradually being lifed, not least because of greater regional co-operaton and the emergence of China, alongside the traditonal lenders, as a major funder of large infrastructure projects. New hydropower capacity in the Democratc Republic of Congo, Ethiopia, Mozambique and Guinea, among others, plays a major role in bringing down the region’s average costs of power supply, reducing the share of oil-fred power. Other renewables, led by solar technologies, make a growing contributon to supply, with a successful aucton-based procurement programme in South Africa showing how this can be achieved cost efectvely. Geothermal becomes the second-largest source of power supply in East Africa, mainly in Kenya and Ethiopia. Two-thirds of the mini-grid and of-grid systems in rural areas in 2040 are powered by solar photovoltaics, small hydropower or wind. As technology costs come down, the atracton of renewable systems versus diesel generators grows (although they are ofen used in combinaton), especially where fnancing is available to cover the higher upfront expense.

Bioenergy use – mainly fuelwood and charcoal – outweighs demand for all other forms of energy combined, a picture that changes only gradually even as incomes rise. Four out of fve people in sub-Saharan Africa rely on the traditonal use of solid biomass, mainly fuelwood, for cooking. A 40% rise in demand for bioenergy to 2040 exacerbates strains on the forestry stock, with eforts to promote more sustainable wood producton hindered by the operaton of much of the fuelwood and charcoal supply chain outside the formal economy. Scarcity, along with eforts to make alternatve fuels like liquefed petroleum gas available, results in some switching away from wood use, especially in towns. Promoton of more efcient biomass cookstoves reduces the health efects of polluton from indoor smoke. Nonetheless, 650 million people – more than one-third of an expanding populaton – stll cook with biomass in an inefcient and hazardous way in 2040.
The rise of the African energy consumer brings a new balance to oil and gas
Almost 30% of global oil and gas discoveries made over the last fve years have been in sub-Saharan Africa, refectng growing global appette for African resources. Nigeria is the richest resource centre of the oil sector, but regulatory uncertainty, militant actvity and oil thef in the Niger Delta are deterring investment and producton, so much so that Angola is set to overtake Nigeria as the region’s largest producer of crude oil at least untl the early 2020s. The value of the estmated 150 thousand barrels lost to oil thef each day – amountng to more than $5 billion per year – would be sufcient to fund universal access to electricity for all Nigerians by 2030. A host of smaller producers such as South Sudan, Niger, Ghana, Uganda and Kenya see rising output; but, by the late 2020s, producton in most countries – with the excepton of Nigeria – is in decline. Additons and upgrades to refning capacity mean that more of the region’s crude supply is processed locally. With regional producton falling back from above 6 million barrels per day (mb/d) in 2020 to 5.3 mb/d in 2040, but demand for oil products doubling to 4 mb/d – an upward trend amplifed in some countries by subsidised prices – the result is to squeeze the region’s net contributon to the global oil balance.

Natural gas resource-holders can power domestc economic development and boost export revenues, but only if the right regulaton, prices and infrastructure are in place. The incentves to use gas within sub-Saharan Africa are expected to grow as power sector reforms and gas infrastructure projects move ahead but, for the moment, as much gas is fared as is consumed within the region. More than 1 trillion cubic metres of gas has been wasted through faring over the years, a volume that – if used to provide power – would be enough to meet current sub-Saharan electricity needs for more than a decade. In our main scenario, natural gas nearly triples its share in the energy mix to 11% by 2040. Nigeria remains the region’s largest gas consumer and producer, but the focus for new gas projects also shifs to the east coast and to the huge ofshore discoveries in Mozambique and Tanzania. The size of these developments and remoteness of their locaton raises questons about how quickly producton can begin, but they provide a 75 billion cubic metre (bcm) boost to annual regional output (which reaches 230 bcm in total) by 2040, with projects in Mozambique larger in scale and earlier in realisaton. East coast LNG export is helped by relatve proximity to the importng markets of Asia, but – alongside the benefts from an estmated $150 billion in fscal revenue to 2040 – both countries are determined to promote domestc markets for gas, which will need to be built from a very low base.

Coal producton and use gradually spreads beyond South Africa, but coal is overtaken by oil as the second-largest fuel in the sub-Saharan energy mix. Development of new coal resources is hindered in many cases by their remoteness and the lack of suitable railway and port infrastructure, consideratons that also afect the outlook for South Africa as the existng mining areas close to Johannesburg start to deplete. Much of the 50% increase in regional output is used locally, ofen for power generaton, with coking coal from Mozambique the only major new internatonal export fow. Prospects for coal are also limited by policy: South Africa, the dominant player in African coal, is seeking to diversify its power mix with renewables, regional hydropower projects, gas and eventually additonal nuclear capacity all playing a role in bringing the share of coal in power output down from more than 90% today to less than two-thirds by 2040. But coal’s relatvely low cost remains an asset in societes concerned about the afordability of electricity.

The sub-Saharan economy quadruples in size and energy demand grows by 80%, but energy could do much more to act as an engine of inclusive economic and social growth. The internatonal arena brings capital and technology, but mixed blessings in other areas. An oil price above $100 per barrel produces a contnued windfall for resource-rich countries – the cumulatve $3.5 trillion in fscal revenue is higher than the $3 trillion that is invested in all parts of the region’s energy supply to 2040 – but few guarantees that this revenue will be re-invested efciently, while the region’s oil product import bills grow, along with vulnerability to supply interruptons. Sub-Saharan Africa is also in the front line when it comes to the impacts of a changing climate, even though it contnues to make only a small contributon to global energy-related CO2 emissions; its share of global emissions rises to 3% in 2040. But the main challenges arise within the region, including not only the needs of a fast-growing populaton but also the impact of weak insttutons, a difcult climate for investment, and technical and politcal barriers to regional trade. Overall, our main scenario outlines an energy system that expands rapidly, but one that stll struggles to keep pace with the demands placed on it. And, for the poorest, while access to modern energy services grows, hundreds of millions – partcularly in rural communites – are lef without.

Beter management of resources and revenues, adoptng robust and transparent processes that allow for more efectve use of oil and gas revenues.
Broad improvements in governance, both inside and outside the energy sector, underpin the achievements of an African Century Case, involving, among many other things, heavy investment in the capacity to formulate and implement sound energy policies, as well as the consultaton and accountability that is essental to win public consent. Although stll not achieving universal access to electricity for all of the region’s citzens by 2040, the outcome is an energy system in which uninterrupted energy supply becomes the expectaton, rather than the excepton. Unreliable power supply has been identfed by African enterprises as the most pressing obstacle to the growth of their businesses, ahead of access to fnance, red tape or corrupton. Relieving this uncertainty helps every dollar of additonal power sector investment in the African Century Case to boost GDP by an estmated $15.
A modernising and more integrated energy system allows for more efcient use of resources and brings energy to a greater share of the poorest parts of sub-Saharan Africa. A reducton in the risks facing investors, as assumed in the African Century Case, makes oil and gas projects more compettve with producton in other parts of the world, allowing more of them to go ahead; and a higher share of the resultng fscal revenue is used productvely to reverse defciencies in essental infrastructure. Electricity trade more than triples as more regional projects advance: 30% of the extra investment in the power sector goes to Central Africa, helping to unlock more of the huge remaining hydropower capacity and connect it to the rest of the contnent. The additon of relatvely low-cost electricity keeps the average costs of supply down, even as power demand rises by almost one-third. Of the extra 230 million people that gain access to electricity in this Case by 2040, 70% are in rural areas, the supply coming primarily from mini-grid and of-grid systems. This investment is instrumental in helping to close the gap in energy provision and economic opportunity between sub-Saharan Africa’s rural communites and the people in its cites. Concerted acton to improve the functoning of the sub-Saharan energy sector is essental if the 21st is to become an African century.