BP: huge rise in energy demand at odds with climate change fight

http://www.theguardian.com/business/2015/feb/17/bp-says-huge-rise-in-energy-demand-at-odds-with-climate-change-fight

Larry Elliott, economics editor
Tuesday 17 February 2015

Rising global demand for energy over the next two decades is at odds with the fight against climate change, the head of BP said on Tuesday, as he outlined the oil giant’s forecasts showing unsustainable increases in carbon emissions.

BP’s annual energy outlook predicted that the world economy would double in size in the next 20 years, resulting in demand for energy rising by almost 40%. The company said two-thirds of this demand would be met from fossil fuels – oil, gas and coal – and that this would lead to a 25% increase in carbon emissions.

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the company said carbon emissions would be growing by 1% a year – “well above” the path recommended by scientists to keep emissions below the ceiling of 450 parts per million that would provide a 50% chance of stabilising global temperatures at 2% above pre-industrial levels.

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BP said the continued increase in emissions would come in spite of less reliance on coal over the coming decades. China has been heavily dependent on coal during its rapid industrialisation since 1990, but demand is expected to grow at 0.8% a year in the period up until 2035, down from 3.8% a year since 2000.

Even with the expected rapid growth in the use of renewable forms of energy over the next two decades, they will still only account for 8% of energy demand by 2035, BP said. Fossil fuels will account for 81% of energy, down from 86% at present.

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BP believes the recent fall in oil prices will prove temporary, putting the decline from $115 a barrel to a low of $45 a barrel down to increases in supply caused by the US shale revolution. Recent weeks have seen a partial recovery in the oil price, with the cost of a barrel of Brent crude standing at around $62 a barrel last night.

The oil company said growth in supply from the new US fields would slow but that global demand would continue to increase, leading to higher prices.

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Over the same period, North Sea oil production is expected to decline to around 500,000 barrels per day as fields in the basin deplete.


“The North sea is a very mature oil and gas province and it will inevitably go through a decline. It peaked in 1999 at around 2.9 millions barrels per day and our projections are that it will be half a million barrels in 2035,” Dudley said.