World Energy Outlook
2018
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World Energy Outlook 2018
www.iea.org/weo The new World Energy Outlook online online database provides easy access to data behind the more than 300 gures and tables in this year’s Outlook , the energy balance tables as well as addional data that are not included in the book. This improved access to data reects the priority priori ty to move towards a more “digital IEA”, and our determination to remain the gold standard for long-term energy research and analysis. Please visit the database at www.iea.org/weo/weo2018 /secure/ secure/.. User ID: WEO2018AnnexA
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INTERNATIONAL ENERGY AGENCY The IEA examines the full spectrum of energy issues including oil, gas and coal supply and demand, renewable energy technologies, electricity markets, energy efficiency, access to energy, demand side management and much more. Through its work, the IEA advocates policies that will enhance the reliability, affordability and sustainability of energy in its 30 member countries, 8 association countries and beyond. The four main areas of IEA focus are: n
Energy Security: Promoting diversity, efficiency, flexibility and reliability for all fuels and energy sources; n
Economic Development: Supporting free markets to foster economic growth and eliminate energy poverty; n
Environmental Awareness: Analysing policy options to offset the impact of energy production and use on the environment, especially for tackling climate change and air pollution; and n
Engagement Worldwide: Working closely with association and partner countries, especially major emerging economies, to find solutions to shared IEA member countries: energy and environmental Australia concerns. Austria
Belgium Canada Czech Republic Denmark Estonia Finland France Germany Greece Hungary Ireland Italy Japan Korea Luxembourg Mexico Netherlands New Zealand Norway Poland Portugal © OECD/IEA , 2018 2018 Slovak Republic Spain International Energy Agency Sweden Website: www.iea.org Switzerland Turkey T urkey United Kingdom United States Please note that this publication is subject to specific restrictions that limit its use and distribution. The terms and conditions are t&c / available online at www.iea.org / t&c
The European European Commission also participates in the work of the IEA.
Secure Sustainable Together
Foreword
The World Energy Outlook ( (WEO) WEO) provides a unique reference for the internaonal debate
on energy. It also plays an essenal guiding role for the Internaonal Energy Agency’s own strategic strategic thinking, underpinning the Agency’s role as the global energy authority. authority. The WEO-2018 reminds WEO-2018 reminds us of the fundamental shi that is taking place in the geography
of global energy demand towards developing economies. That is why, as one of the three pillars of the Agency’s modernisaon strategy, I have put such emphasis on “opening the doors” of the IEA to key energy players from around the world. With the support of our member countries, we have welcomed Mexico as a new member of the Agency and are building very close institutional ties with new Associate members: Brazil, China, India, Indonesia, Morocco, Singapore, South Africa and Thailand. The special focus on electricity in this year’s Outlook demonstrates not only the huge opportunies that arise with the transformaon of the global power sector, sector, but also some potenal risks. The second pillar of our strategy strategy at the IEA is to reinforce reinforce and reappraise our approaches to energy security: alongside work on oil and natural gas, electricity security is becoming a major focus for IEA analysis and engagement. engagement. This new edion also underscores that the world is sll a long way from meeng its environmental objecves, both in terms of climate and air quality. That is why the third pillar of our modernisaon strategy is to transform the Agency into a global hub for co-operaon on clean energy technologies and energy eciency. Our new Clean Energy Transions Programme is a clear signal of this ambion: a mul-year iniave to accelerate deployment of clean energy technologies, parcularly in major developing economies. policie s maer . We should not Most importantly, the WEO WEO underlines once again that policies underesmate underesmate the eort required to get to the outcomes described in our main scenario, the New Policies Scenario, which holds up a mirror to the ambions of policy makers around the world, as they exist today. But nor should we underesmate the need and the potenal to improve on these outcomes and to deliver a more secure, aordable, and sustainable energy future. The key message from this WEO is WEO is that decisions made by governments will play a crical role in this respect, and the IEA stands ready and willing to provide its support for these endeavours.
I would like to applaud the excellent work of the WEO WEO team led by Laura Cozzi – who has taken on the role of the IEA’s Chief Energy Modeller – and Tim Gould. I also take this opportunity to thank the many friends and colleagues from around the world that provided valuable comments and experse during the preparaon of the new Outlook .
Dr. Fah Birol Execuve Director Internaonal Energy Agency Foreword
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Acknowledgements
This study was prepared by the World Energy Outlook (WEO) team in the Directorate of Sustainability, Technology and Outlooks (STO) in co-operaon with other directorates and oces of the Internaonal Energy Agency. The study was designed and directed by Laura Cozzi, Chief Energy Modeller and Head of Division for Energy Demand Outlook, and Tim Gould, Head of Division for Energy Supply and Investment Outlook. Timur Gül led the environment and demand modelling, and contributed to the electricity focus. The special focus on electricity was co-ordinated by Brent Wanner, lead on power sector modelling and analysis, and Stéphanie Bouckaert, lead on end-use modelling and analysis. Christophe McGlade led the work on the emissions intensity of oil and gas supply and the oil analysis. Paweł Olejarnik co-ordinated the oil, natural gas and coal supply modelling. Key contribuons from across the WEO team WEO team were from: Zakia Adam (lead on data management, contributed to fossil fuel subsidies), Ali Al-Saar (lead on producer economies), Yasmine Arsalane (lead on the European Union (EU) Energy Union analysis, power sector modelling), David Almayr (demand-side response analysis), Adam BaylinStern (industry, contributed to electricity focus), Michela Cappannelli (oil, gas, bioenergy), Jean Chateau (producer economies), Olivia Chen (energy access and environment, buildings), Arthur Contejean (energy access), Hannah Daly (lead on energy access), Davide D’Ambrosio (power sector modelling and data management, contributed to electricity focus), Valeria Di Cosmo (electricity focus), Valenna Ferlito (lead on renewables support, contributed to electricity focus), Karthik Ganesan (India analysis in the electricity focus), Timothy Goodson
(co-lead on buildings demand, demand-side response and contributed to electricity focus), Asbjørn Zachariassen Hegelund (industry, contributed to electricity focus), Paul Hugues (lead on transport, contributed to energy eciency and renewables), Tae-Yoon Kim (lead on petrochemicals, oil rening and trade, contributed to gas), Aaron Koh (electricity focus, renewables support), Zeynep Kurban (hydrogen), Raimund Malischek (coal, gas), Wataru Matsumura (producer economies, electricity focus), Kieran McNamara (electricity focus and contributed to renewables and eciency chapter), Claudia Pavarini (lead on storage, power sector modelling), Apostolos Petropoulos (transport, contributed to electricity focus), Andrew Prag (lead on the Sustainable Development Development Scenario chapter, chapter, contributed to electricity focus), Diana Alejandra Rodriguez Barrera (producer economies, oil), Andreas Schröder (industry), Toshiyuki Shirai (producer economies, fossil fuel subsidies), Glenn Sondak (oil, gas), Molly A. Walton (lead on energy-water nexus), Kira West (industry), David Wilkinson (power sector hourly modelling, electricity focus) and Peter Zeniewski (lead on natural gas). Teresa Coon, Eleni Tsoukala and Marina Dos Santos provided essenal support. Edmund Hosker carried editorial responsibility. responsibility. Debra Justus was the copy-editor.
The special focus on electricity was developed by a cross-agency Electricity Focus Working Group drawn from all relevant directorates and oces of the IEA, in addion to the WEO team. Luis Munuera from the Energy Technology Policy (ETP) Division led the analysis on exibility in electricity systems. Also from the ETP Division, Araceli Fernandez Pales, Acknowledgements
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Peter Levi and Tiany Vass contributed to the analysis on industry; John Dulac and Thibaut Abergel contributed to the analysis on buildings; Jacob Teter and Marine Gorner contributed to the analysis on transport; and Uwe Remme contributed to the analyses on energy storage and hydrogen. George Kamiya from the Energy Environment Division contributed to the analysis on buildings, transport and digitalizaon. Kevin Lane, Joe Ritchie and Sacha Scheer from the Energy Eciency Division contributed to the analysis on energy eciency. Heymi Bahar from the Renewable Energy Division contributed to the analyses
on distributed generaon and aordability of electricity. From the System Integraon of Renewables Unit, Simon Mueller and Peerapat Vithayasrichareon contributed to the analyses on renewables renewables integraon and exibility; and Zoe Hungerford, Enrique Guerrez and Craig Hart contributed to the analyses on India, renewables integraon and exibility. Yugo Tanaka from the Oce of Global Energy Relaons contributed contributed to the India analysis. Cesar Alejandro Hernandez from the Gas, Coal and Power Markets Division, Michael Waldron and Alberto Toril from the Economics and Investment Oce contributed to the analysis on investment, markets and security. Mechthild Wörsdörfer, Director of STO, and David Turk, Acng Director of STO, provided valuable guidance at dierent stages of the work. Valuable comments and feedback were provided by senior management and numerous other colleagues within the IEA. In parcular, Paul Simons, Keisuke Sadamori, Amos Bromhead, Rebecca Gaghen, Duncan Millard, Laszlo Varro, Neil Atkinson, Peter Fraser, Paolo Frankl, Brian Motherway, Aad Van Bohemen, Aya Yoshida, Yoshida, Chrisan Chrisa n Zinglersen, Simon Benne, Niels Berghout, Thomas Berly, Alessandro Blasi, Toril Bosoni, Jean-Bapste Dubreuil, Carlos Fernández Alvarez, Kathleen Ganey, Peter Janoska, Caroline Lee, Juho Lipponen, Armin Mayer, Samantha McCulloch, Sara Moarif, Bruce Murphy, Yoko Nobuoko, Krisne Petrosyan, Cedric Philibert, Roberta Quadrelli, Céline Rouquee, Melanie Slade, Tristan Stanley, Jeremy Sung, Cecilia Tam, and Mahew Wienstein. Wienstein. The Energy Data Centre provided support and assistance throughout the preparaon of the report. Thanks go to the IEA’s Communicaon and Informaon Oce for their help in producing the nal report and website materials, parcularly to Astrid Dumond, Christopher Gully, Jad Mouwad, Bertrand Sadin and Rob Stone. Diana Browne provided essenal support to the peer review process. Valuable input to the analysis was provided by: Markus Amman, Peter Rafaj, Janusz Cofala, Gregor Kieseweer, Wolfgang Schöpp, Chris Heyes, Zbigniew Klimont, Jens BorkenKleefeld, Pallav Purohit and Adriana Gómez-Sanabria (Internaonal Instute for Applied Systems Analysis); Colin Ward (King Abdullah Petroleum Studies and Research Center); Stephen J. Lee, Ignacio Pérez-Arriaga, Eduardo Sánchez, Andrés González and Pedro Ciller (MIT-Comillas Universal Energy Access Lab); Faisal Wahid and Christopher Andrey (Artelys); David Mooney and Anthony Lopez (Naonal Renewable Renewable Energy Laboratory); Eric Masanet (Northwestern University); and Per Magnus Nysveen (Rystad Energy). The work could not have been achieved without the support and co-operaon provided by many government bodies, organisaons and companies worldwide, notably: Chevron; 6
World Energy Outlook 2018
