Fossil Fuel Still Fastest Growing Energy Source
Some 87 percent of total world primary energy demand is met by oil, coal and natural gas, and more than 92 percent with nuclear energy, according to a new report by the World Economic Forum.
Energy Vision 2013 – Energy Transitions: Past and Future says the biggest energy challenge facing the world today is meeting the rapidly growing energy needs of emerging market nations, including the 1.3 billion people that have little or no access to modern energy.
In response to this challenge, policy makers are looking toward low-carbon and renewable sources of energy — but fossil fuels remain the fastest growing energy source. Wind, solar, geothermal and other non-hydro renewable resources provide just 1.6 percent of total world energy.
The report, written in collaboration with IHS Cambridge Energy Research Associates, says there is a renewed and much more intense focus on what kind of energy transition might be ahead and what the timing might be. Trade, globalization, energy storage and transmission, as well as policies and pricing of carbon, will be among main factors influencing the changing mix.
Price and value delivered will be key determinants in shaping the energy mix of the future. That price may be set in the competitive marketplace or may result from a price on carbon and/or government incentives and subsidies. New technology will likely have a major impact on the energy mix, but probably not until the 2030s, owing to lead times.
Looking ahead, the report forecasts renewable electricity sources to grow, but says challenges remain. It says hydroelectric capacity will expand from a 16 percent share of global electricity production as of 2011 to 30 percent by 2020. Wind generation — the fastest growing renewable energy source — will account for one quarter of renewable electricity by 2035.
However, for renewables to gain market share over fossil fuel sources, cost competitiveness is key, especially for wind and solar.
And while the transportation sector will continue to increase demand for oil over the next 15 to 20 years, new fuels with lower GHG emissions will become more cost competitive and effective. In addition to biofuels made from food products, advances in cellulosic ethanol, biocrude, genetic modification to improve yields of energy crops and synthetic genomics could produce lower-cost, more sustainable biofuels.
Additionally, LNG looks promising for long-haul trucking because its high annual mileage (more than 190,000 km per year) can translate into fuel cost savings. Hydrogen fuel cell vehicles are another option, but will require infrastructure investments.
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