Overviews of global fossil energy and clean renewable energy transformation
Globally, many developed countries and emerging economies have been implementing new policies and regulations to control climate changes and reduce GHG emissions. These should help to reduce environmental pollution and help them with their compliance with their Paris Agreement commitments. Many countries have enacted new clean energy policies which would significantly change their overall energy mix by boosting clean renewable energy usages whilst reducing fossil fuel consumptions.
Clean renewable energy investments globally have increased, by over USD1 trillion over the last decade, in both emerging economies and developed countries across the world. These global clean renewable energy growths and transformations have already helped to create over ten million new jobs in the clean renewable energy and low-carbon economy sectors in various key countries. Looking ahead, it is expected that clean renewable energy growths should continue with annual investments of over USD200 billion for the foreseeable future (IRENA, Investments in Renewables Analysis, 2018).
The significant shifts in fossil fuel consumptions and clean energy growths across the world have been progressing differently in various countries. The global energy demands have been growing slowly with low demand growth rates of about 0.9% over the period of the last five years from 2011 to 2016. In 2017, the global energy demands actually increased by over 2%. When the global energy growth patterns are analysed in detail, it showed that more than 40% of the energy growths in recent years have been driven by China and India. These two countries have been the fastest growing major emerging economies in the world in recent years.
Detailed analysis showed that the large majority, about 72%, of the increased energy consumptions in recent years have been met by fossil fuel growths and consumptions, which are very concerning. Only a quarter of the new energy growths were met by clean renewable energy sources. The remainder of the global energy rise was met by nuclear energy (IEA, Energy & CO2 Report, 2017).
The rise in global energy demands in 2017 has also resulted in energy-related CO2 emissions increasing higher by near to 1.5% in 2017. Global CO2 emissions reached a historic high of 32.5 giga-tons (Gt) in 2017. The resumption of CO2 emission growths was very worrying as this has reversed the trends of the last three years of global CO2 emissions remaining stable.
Analysis of the global increases in CO2 emissions has shown that there have been different emission trends amongst the key countries. Most major economies have seen rises in their CO2 emissions. Some key economies had actually experienced some declines in their CO2 emissions. The key countries with declines in CO2 emission included the United States, the United Kingdom, Mexico and Japan. These countries have been able to achieve their emission declines with their new energy policies and clean renewable energy transformations. A good example is that the USA has reported its biggest CO2 emission declines in recent years, mainly, due to its higher clean energy and renewable deployments. These US renewable growths have occurred despite the current US Administration expressing doubts about climate change and introducing some energy policies promoting fossil fuel applications and consumptions (REN, Renewables Global Status Report, 2018).
The total global fossil crude oil consumptions have also risen by over 1.5% with the higher energy demands in 2017. This was equivalent to a rise in oil demand of some 1.5 million barrels per day. These higher oil demand rate rises were more than twice the annual average increases seen over the last decade. Analysis showed that the rising oil demands have been driven mainly by the transport and chemical sectors globally. The rising share of sport utility vehicles (SUVs) and light trucks in many major economies globally has been driving up oil fuel consumptions, especially in the form of gasoline and diesel. In addition, the increased demands from the petrochemical and chemical sectors for fossil oil and gas feedstocks have contributed to the rising global fossil fuel growths.
Demands of global natural gas have grown faster than those of crude oil, with growth rates of around 3% per annum. These higher gas growth rates have been driven by many countries viewing natural gas as a clean transitional fossil fuel, as part of their fossil to renewable energy transformation. There have also been abundant gas supplies from various gas-producing countries with relatively stable and low gas pricings. China alone has accounted for almost 30% of the global gas consumption growths in recent years. In the past decade, about half of the global gas demand growths have come from the power and electricity sectors. However, recent gas demand growths have changed and these have been driven largely by the rises in energy demands from the industrial and building sectors.
Analysis has also shown that the global coal demands and consumptions have risen again, by about 1% in 2017. This concerning rise has reversed the declining coal consumption trends seen over the last two years. The new coal growths were mainly due to rising coal demands from some emerging economies in Asia. These rising coal demands have resulted from increases in their coal-fired electricity generation capacity and new coal-fired power stations being built in some of the emerging economies.
Experts have reported that clean renewable energies have enjoyed some of the highest growth rates of most energy sources in recent years. Renewable and clean energies have been meeting a quarter of the new global energy demand growths in recent years. China and the United States (USA) have led the renewable and clean energy transformations. Together they have contributed around 50% of the increases in new renewable-based electricity generation capacities globally. The European Union (EU), India and Japan have also contributed significantly to the renewable transformation globally. Wind power has accounted for over 35% of the growths in renewable electricity power outputs.
The global electricity demands have increased by over 3%, which has been significantly higher than the increases in global energy demands for the equivalent periods. China and India have together accounted for about 70% of these new electricity demand growths. It is concerning to see that these new rises in electricity demands have been met by traditional fossil fuels, including gas and coal, in addition to clean renewable and nuclear energies globally. Outputs from nuclear plants globally are seen to have risen by 26 terawatt hours (TWh) in 2017, when a significant number of new nuclear capacities have completed their first full year of operation.
It is also worrying to see that the improvements in global energy efficiency have slowed down dramatically in recent years, after the good improvements achieved over previous years. Analysis showed that these global energy efficiency slowdowns have been caused largely by weaker improvements from new energy efficiency policy coverage, as well as lower energy prices, which resulted in higher and less efficient consumptions. Global energy intensity improved by only 1.7% in 2017, which is lower than the average of 2.3% over the last three years.
Looking ahead, global energy consumptions are expected to rise by over 40% from now to 2030–2035. The majority of the new incremental energy growths, estimated to be over 90%, are expected to be coming from the emerging economies. The energy growths in China and India are expected to account for more than half of the total incremental energy increases globally, with their continued high economic growths. Looking ahead to 2035, energy experts have forecasted that the energy consumptions in the non-OECD emerging economies will likely rise by over 65%, compared to their 2012 levels (IEA, World Energy Outlooks, 2018).
Energy experts have also forecasted that after more than a century of constant energy growths, the global energy demand growths are likely to peak or plateau around 2030–2035. This forecast of a global energy plateau or peak is important but it will be dependent on many factors. The key strategic drivers will include fossil to clean energy transition, shifts to lower consumption industries, heavy industry getting more efficient, improved energy efficiencies, implementation of energy-efficient technologies, etc. A good example is that China’s total energy consumption for steel production by 2035 could be halved by applying more efficient blast and arc furnaces (McKinsey, Global Energy Perspective, 2019).
Looking ahead, energy experts globally have generally forecasted that the rise of renewable resources should continue for the foreseeable future. Wind power and solar power have so far only constituted a small slice of the global energy mix despite growths. However, it is encouraging to note that they have accounted for more than half of new installed energy capacities globally in recent years.
It is important to note that energy experts have also been predicting that new solar or wind technologies will be becoming more cost competitive, with various innovations and cost reduction measures, against fossil fuel technologies, by the 2020–2025 period. These improvements in cost competitiveness should support new wind and solar generation capacities increasing significantly, by a factor of 10–60 times depending on locations, from year 2015 to 2050. Looking ahead to 2035, clean renewable energies are expected to make up more than 50% of the total power generation capacities globally.
Looking ahead, energy experts have also predicted that traditional fossil fuel growths are likely to decline further but it is unlikely to vanish by the end of 2100. The growths in crude oil and coal demands are expected to slow down further globally. Experts have predicted that crude oil demands are likely to be peaking in the early 2030s. However, experts are predicting that natural gas demands are likely to continue growing until 2035. This is driven by continued rising gas demands in China and other emerging economies. After 2035, experts have predicted that the natural gas growths globally are likely to plateau or peak. This is largely because of the increasing competition from clean renewable energies. These major mega-trend shifts in future fossil fuel consumptions are likely to lead to peaking in global carbon emissions in 2020s–2030s. These should then lead to a likely global decline in carbon emissions, which could potentially start in the mid-2020s. Some climate experts have predicted that there could be an eventual fall in carbon emissions of roughly 20% by 2050 globally. These carbon declines will be heavily dependent on different key policy measures in various emerging economies and developed countries (McKinsey, Global Energy Perspective, 2019).
It is interesting to compare the future energy growths of the developed countries with those of the emerging economies globally. Experts have generally predicted that the energy demands of the advanced developed economies of North America and Europe are expected to grow only very slowly in the short and medium terms. Looking ahead to beyond 2030, the energy demands of the advanced developed countries could even fall if their new energy efficiency policies and improvement plans would work out as planned (Wang, Energy Markets in Emerging Economies, 2016).
Looking ahead to 2035, crude oil is generally expected to have the slowest growth rates amongst the major fossil fuels. The majority of the new net oil demand growths are expected to come from the emerging economies outside the OECD. The combined oil demand growths from China, India and the Middle East will likely account for most of the new net oil demand growths globally. The key emerging economies in Asia are also expected to show the largest growths in liquid oil fuel consumption globally, with China accounti...
