energy for all will not cost the earth
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Dr. Fatih BirolChief Economist for the International Energy Agency13 March 2012Sustainable Energy for All (#SE4A)ConferenceVeniceTRANSCRIPT
© OECD/IEA 2011
Energy for all will not cost the earth
Dr Fatih BIROL IEA Chief Economist
13 March 2012
© OECD/IEA 2011
The context: fresh challenges add to already worrying trends
Economic concerns have diverted attention from energy policy and limited the means of intervention
Post-Fukushima, nuclear is facing uncertainty
MENA turmoil raised questions about region’s investment plans
Some key trends are pointing in worrying directions:
CO2 emissions rebounded to a record high
energy efficiency of global economy worsened for 2nd straight year
spending on oil imports is near record highs
© OECD/IEA 2011
Emerging economies continue to drive global energy demand
Growth in primary energy demand
Global energy demand increases by one-third from 2010 to 2035, with China & India accounting for 50% of the growth
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
4 500
2010 2015 2020 2025 2030 2035
Mto
e
China
India
Other developing Asia
Russia
Middle East
Rest of world
OECD
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Energy poverty is widespread
31
8
85
653
836
423
661
Latin America
Sub-Saharan Africa China
India
Rest of developing
Asia
289 379
585
1.3 billion people in the world live without electricityand 2.7 billion live without clean cooking facilities
Million people without electricity
Million people without clean cooking facilities
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Investment today is far from enough
Current investment relies heavily on overseas development aid
$9.1 billion was invested in energy access in 2009
Bilateral Official Development Assistance
Multilateral organisations
Developing country governments
14%
34%
31%
22%
Private sector finance
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Giving modern energy to the world will not cost the earth
Investment needs to grow by more than five-times to $48 billion a year – half of which in sub-Saharan Africa
0 10 20 30 40 50
Energy for All Case2010-2030
2009
Billion dollars (2010)
5.3 x more
Other Countries Sub- Saharan Africa
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All sources of finance need to grow
Private sector investment needs to grow the most, but public authorities must provide a supportive investment climate
0
10
20
30
40
50
2009 Energy for All Case
Billi
on d
olla
rs (2
010) Private finance
Developing country governments
Multilateral development banks
Bilateral official development assistance
© OECD/IEA 2011
A range of technical solutions using different sources of energy is required
Additional electricity generation by grid solution and fuel in 2030
63%
3%
14%
6%5%
10%Fossil fuels
Nuclear
Hydro
Wind
Solar
Other renewables
On-grid generation368 TWh
36%
8%21%
28%
7%
Solar
Small hydro
Biomass
Wind
Diesel
Mini-grid and off-grid generation370 TWh
All fuels have a role to play
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Implications of modern energy for all
Achieving modern energy for all would only have a negligible impact on energy security and climate change
0
5
10
15
20
World energy demand
2030
Billi
on to
nnes
of o
il eq
uiva
lent
0
10
20
30
40
Gig
aton
nes
World CO2
emissions2030
1.1%0.7% Additional energy demand in the
Energy for All Case
Additional CO2 emissions in theEnergy for All Case
© OECD/IEA 2011
Modern energy brings health benefits
Clean cooking facilities would prevent the majority of deaths attributable to indoor air pollution from burning biomass
Premature annual deaths from household air pollution and selected diseases
0
0.5
1.0
1.5
2.0
2.5
2008 2030Malaria
2008 2030Tuberculosis
2008 2030Smoke from
biomass
2008 2030HIV/AIDS
Mill
ion
© OECD/IEA 2011
Concluding remarks
In a world full of uncertainty, one thing is sure: rising incomes & population will push energy needs higher
Modern energy is critical to social and economic development goals
Affordable and reliable modern energy for all by 2030 is achievable Adopt a clear statement that modern energy access is a political priority
Mobilise additional public and private investment in universal access
National governments need to adopt strong governance and regulatory frameworks and invest in internal capacity building
The public sector should leverage greater private sector investment where the commercial case is marginal
World Energy Outlook has highlighted energy access for a decade and will continue to do so in WEO-2012