In this photo taken Jan. 19, 2012, smoke rises in this time exposure image from the stacks of the La Cygne Generating Station coal-fired power plant in La Cygne, Kan. (AP Photo/Charlie Riedel, Filr)
There’s a new International Energy Agency report out today that has important news for the coalfields. From the IEA fact sheet:
Fossil fuels remain the principal sources of energy worldwide, though renewables grow rapidly. Demand for oil, gas and coal grows in absolute terms through 2035, but their combined share of the global energy mix falls from 81% to 75% during that period.
And there’s this, which will sound familiar to folks in Appalachia:
The unlocking of unconventional resources portends a very bright future for natural gas, which nearly overtakes coal in the primary energy supply mix by 2035.
Now, much of the media coverage is going to focus as this report from Reuters did:
The United States will overtake Saudi Arabia and Russia as the world’s top oil producer by 2017, the West’s energy agency said on Monday, predicting Washington will come very close to achieving a previously unthinkable energy self-sufficiency.
The International Energy Agency (IEA) said it saw a continued fall in U.S. oil imports with North America becoming a net oil exporter by around 2030 and the United States becoming almost self-sufficient in energy by 2035.
“The United States, which currently imports around 20 percent of its total energy needs, becomes all but self-sufficient in net terms – a dramatic reversal of the trend seen in most other energy importing countries,” it said.
But what’s probably far more important is what IEA Executive Director Maria van der Hoeven tried to explain in the agency’s news release:
North America is at the forefront of a sweeping transformation in oil and gas production that will affect all regions of the world, yet the potential also exists for a similarly transformative shift in global energy efficiency. This year’s World Energy Outlook shows that by 2035, we can achieve energy savings equivalent to nearly a fifth of global demand in 2010. In other words, energy efficiency is just as important as unconstrained energy supply, and increased action on efficiency can serve as a unifying energy policy that brings multiple benefits.
Why? Fatih Birol, IEA Chief Economist and the WEO’s lead author, explains:
Our analysis shows that in the absence of a concerted policy push, two-thirds of the economically viable potential to improve energy efficiency will remain unrealised through to 2035. Action to improve energy efficiency could delay the complete ‘lock-in’ of the allowable emissions of carbon dioxide under a 2oC trajectory – which is currently set to happen in 2017 – until 2022, buying time to secure a much-needed global climate agreement. It would also bring substantial energy security and economic benefits, including cutting fuel bills by 20% on average.
Regarding coal, a few more things from the IEA report:
— Coal remains the backbone of [electricity] generation globally, particularly outside the OECD, but its share of the mix is eroded from two‐fifths to one‐third.
Coal has met nearly half of the rise in global energy demand over the last decade, growing faster even than total renewables. Whether coal demand carries on rising strongly or changes course will depend on the strength of policy measures that favour lower-emissions energy sources, the deployment of more efficient coal-burning technologies and, especially important in the longer term, CCS. The policy decisions carrying the most weight for the global coal balance will be taken in Beijing and New Delhi – China and India account for almost three-quarters of projected non-OECD coal demand growth (OECD coal use declines). China’s demand peaks around 2020 and is then steady to 2035; coal use in India continues to rise and, by 2025, it overtakes the United States as the world’s second-largest user of coal. Coal trade continues to grow to 2020, at which point India becomes the largest net importer of coal, but then levels off as China’s imports decline. The sensitivity of these trajectories to changes in policy, the development of alternative fuels (e.g. unconventional gas in China) and the timely availability of infrastructure, create much uncertainty for international steam coal markets and prices.