Global energy demand to rise 40 percent by 2030
ISTANBUL – Hürriyet Daily News | 12/9/2009 12:00:00 AM |
Global energy demand will increase by 40 percent by 2030, reaching 16.8 billion tonnes of oil equivalent, according to ‘World Energy Outlook 2009’ published by the International Energy Agency. The agency also projects a persistently high level of spending on oil and gas imports would represent a substantial financial burden on import-dependent consumers like Turkey
Global energy use is set to fall this year as a consequence of the financial crisis. The downward trend, however, will not continue for long and the energy consumption will soon resume its upward trend if government policies do not change, World Energy Outlook 2009, or WEO, report has warned.
An investment of $10.5 trillion is needed in low-carbon energy technologies and energy efficiency by 2030, according to the report prepared by the International Energy Agency, or IEA.
Speaking at a press conference in Istanbul on Wednesday, Fatih Birol, chief economist at IEA, said in WEO’s reference scenario, global energy demand would increase by 40 percent by 2030, reaching an equivalent of 16.8 billion tones of oil. The projection is lower than that of last year’s report, reflecting the impact of the economic crisis and new government policies introduced over the past year.
[HH] Exploration spending down, demand up
According to the report, demand for oil, which stood at 85 million barrels a day in 2008, will rise to 88 million barrels a day in 2015, and 105 million barrels a day in 2030. At the same time budgeted spending on the exploration and production of oil and gas is declining. Budgeted spending on exploration and production was 90 billion in 2009, which is a decline of 19 percent compared to 2008. “This is the biggest decline in recent history and the first time spending declines since 2000,” Birol said.
Because the production volume of oil in existing fields is declining, there is a continuing need for investments, Birol said. “In order to tackle reducing production volumes and increasing demand there is a need for approximately 2700 billion cubic meters of additional oil production – a need of four times the current production capacity of Russia,” he said.
[HH] Energy imports a financial burden
IEA also projects a persistent high level of spending on oil and gas imports creating a substantial financial burden on import-dependent consumers like Turkey. The energy poverty challenge also remains unresolved with the projected 1.3 billion people without electricity by 2030 from 1.5 billion today, though universal access could be achieved with an investment of $35 billion per year between 2008 and 2030.
The report also identified higher oil prices, coupled with the downturn in the oil investment sector, as a serious threat to the world economy. As a result of the financial crisis, investment in upstream oil and gas have already been cut by over $90 billion this year compared to 2008.
[HH] Sabancı on nuclear energy
Commenting on the findings of the WEO 2009 report, Chief Executive Officer of Sabancı Holding Ahmet Dördüncü said one way Turkey can develop its energy sector could be nuclear energy.
“Nuclear energy should be seen here, as it is abroad, one useful way to satisfy an increasing energy demand is to diversify the supplying sources of electricity and bring our dependency on natural gas to a moderate level,” Dördüncü said. However, when questioned if Sabancı Holding would be interested in taking part in a potential tender on nuclear energy in Turkey, Dördüncü gave no definite answer. “We would have to see the specific conditions of the tender,” he said.
[HH] Legislative update needed
Arzuhan Doğan Yalçındağ, chairperson of the Turkish Industrialists’ and Businessmen’s Association, or TÜSİAD, agreed on the need to reduce Turkey’s dependence on energy imports.
“The sources for oil and natural gas in Turkey are limited. The country is an importer of energy with more than 70 percent of its energy consumption being imported in 2008. The sources of this supply need to be as diversified and supplied domestically as possible.”
In order to do so Turkey needs to focus on oil exploration, refining and production. “And for these purposes there is a need for a legislative reform of the Oil Law,” Doğan Yalçındağ said.