A World in Transformation: World Energy Outlook 2017

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The resurgence in oil and gas production from the United States, deep declines in the cost of renewables and growing electrification are changing the face of the global energy system and upending traditional ways of meeting energy demand, according to the World Energy Outlook 2017. A cleaner and more diversified energy mix in China is another major driver of this transformation. WEO2017, the International Energy Agency’s flagship publication, finds that over the next two decades the global energy system is being reshaped by four major forces: the United States is set to become the undisputed global oil and gas leader; renewables are being deployed rapidly thanks to falling costs; the share of electricity in the energy mix is growing; and China’s new economic strategy takes it on a cleaner growth mode, with implications for global energy markets.

Solar PV is set to lead capacity additions, pushed by deployment in China and India, meanwhile in the European Union, wind becomes the leading source of electricity soon after 2030. As demand growth in China slows, other countries continue to push overall global demand higher—with India accounting for almost one-third of global growth to 2040.

WEO-2017 finds it is too early to write the obituary of oil. Global oil demand continues to grow to 2040, although at a steadily decreasing pace—while fuel efficiency and rising electrification bring a peak in oil used for passenger cars, even with a doubling of the car fleet to two billion. But other sectors—namely petrochemicals, trucks, aviation, and shipping—drive up oil demand to 105 million barrels a day by 2040. The World Energy Outlook does not offer a forecast of what the energy system will look like but instead presents various projections to 2040 based on different policy assumptions, in order to give policy makers the tools to decide what path to follow. The main case is called the New Policies Scenario, and it models current and announced energy policies, including those in the Paris Agreement. This year, the report introduces the Sustainable Development Scenario, which offers an integrated way to achieve a range of goals: climate stabilization, cleaner air, and universal access to modern energy.

Source: MNRE

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