Schalk Cloete has completed his own 5-part independent Global Energy Forecast to 2050 to compare with this year’s IEA World Energy Outlook, published mid-November. Underpinning all his predictions is his bet that the world will adopt tech-neutral policies (i.e. not backing any one technology over another, like a very high carbon tax) in 2030: in his opinion it will be the best way to accelerate the transition to meet the Paris goals as the 1.5°C and, soon after, the 2°C carbon budgets are exhausted. Today’s article compares his results with the IEA’s. Generally speaking, his projections are below the expectations of the IEA’s most optimistic scenario, the Sustainable Development Scenario. Hence his emphases on behaviour change, carbon capture and carbon taxes.
You can read the author’s complete series, starting with his first article which introduced his methodology. The second covered wind and solar, the third fossil fuels, the fourth nuclear, biomass and CCS, and the final battery electric vehicles. Cloete welcomes comments and feedback from our readers.
Three previous articles outlined my view of how the global energy system will evolve over the next three decades with respect to wind & solar, fossil fuels, and nuclear, biomass & CCS. My forecasts were continuously compared to the IEA World Energy Outlook 2018. Earlier this month, the 2019 version of the World Energy Outlook was released, so it will be interesting to see whether the IEA revised its outlook towards or away from my forecast.
First, we’ll look at the more interesting clean energy options of wind, solar, nuclear and CCS. Then, the more traditional energy sources of fossil fuels and biomass will be covered.
Clean energy technologies: wind, solar, nuclear, CCS
The IEA outlooks for different clean energy technologies for 2018 (solid lines) and 2019 (dashed lines) are shown below. As has been the trend over several years, the outlook for wind and solar received a healthy boost in this year’s World Energy Outlook. This brings the central New Policies Scenario (NPS) closer to my forecast, although the solar outlook is still far below my expectation.
Nuclear received a downgrade in the 2019 World Energy Outlook, particularly in the Sustainable Development Scenario (SDS). The projected SDS trend is now almost exactly on my forecast. For CCS, the IEA trend remains one of an earlier start, but flatter development than my outlook.
Policy support v tech neutrality
Wind and solar enjoy strong policy support even in the NPS and Current Policies Scenario (CPS) outlooks, while nuclear and CCS only benefit in the SDS scenario via a meaningful CO2 price (75-100 $/ton by 2030 and 125-140 $/ton by 2040). This is the main difference between my forecast and the IEA outlooks. The IEA accounts for a wide range of technology-forcing policies, while my simpler forecast assumes that we will be forced into more efficient technology neutrality shortly before 2030 when the 1.5 °C carbon budget is officially exhausted and current policies have yet to achieve a clear peak in global emissions.
Fossil fuels and biomass
The forecast for the major hydrocarbon energy carriers is rather boring. As shown below, very little changed between the World Energy Outlooks from 2018 (solid lines) and 2019 (dashed lines).
The biggest deviation between my forecast and the NPS of the IEA remains for oil, where I see substantial demand reductions from a large-scale shift in personal mobility preferences (see my EV forecast). Clearly, this possibility is not yet seen by the IEA. For other hydrocarbons, my gas outlook remains a little lower due to more clean energy in the electricity sector, whereas coal gives up some market share to nuclear and biomass following technology neutrality around 2030.
The World Energy Outlook update from 2018 to 2019 did not contain many surprises. Wind and solar got the expected boost at the expense of nuclear. Fossil fuels and biomass remained unchanged. However, as we are about to move into the 2020’s and the noise surrounding climate change intensifies, it may be necessary to start making some adjustments to the central NPS outlook.
As stated earlier, my bet is on technology-neutral climate policies somewhere close to the end of the next decade, creating a clear shift in global energy markets. I will certainly be wrong, but it will be interesting to see by how much and for what reasons. We’re entering a very interesting decade…
Schalk Cloete is a Research Scientist at Sintef.