Fossil Fuels Will Provide Nearly 80% Of The World’s Energy Demand In 2040

Global population growth of nearly 2 billion, a doubling of worldwide economic output and rapid expansion of the middle class in emerging economies are all expected to contribute to energy demand growth of about 25 percent from 2015 to 2040. Average electricity use per household will rise about 30 percent between 2015 and 2040. With the global middle class more than doubling to about 5 billion, the number of cars, sport-utility vehicles and pickups are expected to increase about 80 percent to 1.8 billion vehicles by 2040. ‚Äì-ExxonMobil, 2017 Outl0ok for Energy

The global energy mix will not look that much different for oil and gas in 2040, according to Exxon Mobil’s recently released 2017 Outlook for Energy: A View to 2040. Both the middle class and world GDP is expected to double in the next 15 years, accelerating demand for air conditioned homes, cars, and appliances such as refrigerators, washing machines, and smart phones. Non-OECD nations, particularly China and India, will experience the most economic growth, driven by urbanization. —OilPrice, 30 December 2016

While renewables get a great deal of attention ‚Äì and for good reason — oil is expected to remain the world’s primary energy source through 2040, meeting roughly 33% of demand, according to ExxonMobil’s recently released 2017 Outlook for Energy: A View to 2040. “By 2040, world population is expected to reach 9.1 billion, up from 7.3 billion today. Over that same period, global GDP will effectively double, with non-member countries of the Organization of Economic Cooperation and Development (OECD) seeing particularly high levels of economic growth. This means rising living standards in essentially every corner of the world, and billions of people joining the global middle class. The world will need to pursue all economic energy sources to keep up with this considerable demand growth,” the Outlook states. —Kallanish Energy News, 3 January 2016

A problem OPEC has long hoped to avoid mentioning, let alone addressing, has emerged. We are talking, of course, about U.S. shale, the biggest marginal swing producer in the world. The problem, in a nutshell, is one of clean balance sheets (those companies which had to file bankruptcy, have done so by now, and as a result most now have a far lower All-In Production Cost, not to mention far less debt, and re-energized management teams) as well as one of rising efficiency due to drilling technological advances. While U.S. drillers have added about 200 rigs since May, taking advantage of rising prices as talk of an OPEC supply cut circulated, one wonders what will happens to U.S. oil production once the number of rigs returns to its recent historical levels between 1,800 and 2,000? One thing we do know is that after two years of quietly avoiding the spotlight, the shale industry is ready to return with a bang, and according to Reuters, “U.S. shale drillers are set to ramp up spending on exploration and production next year as recovering oil prices prompt banks to extend credit lines for the first time in two years.” —OilPrice, 29 December 2016

China recently reported rising coal industry earnings. The Chinese National Bureau of statistics mentioned a growth of “157 percent in the first 11 months of 2016”, while industries such as oil and gas drilling along with power supply saw profits decline in the subsequent period. This continued use of coal mirrors the rise in coal-fired power plants under construction or completed by China and India, African nations, and many European countries as well. There are reasons why coal will continue to rise in use. Chinese, Indian, African and European nations will continue to use coal for a simple reason ‚Äì it is inexpensive ‚Äì compared to renewables, nuclear, or even natural gas. Very dirty, but very cheap, and that’s what is driving the Chinese and others to use so much coal. –Todd Royal, OilPrice, 28 December 2016

Three separate fracking projects could crank into action this year as Britain’s shale gas industry finally gets off the starting blocks after years of delay, according to industry chiefs. Hydraulic fracturing at a site in Kirby Misperton, North Yorkshire, could start within weeks after a judge rejected a legal appeal by environmental campaigners and residents to halt the project, led by Third Energy, just before Christmas. Activity at the site in the North York Moors could start within weeks. Two other operators — Cuadrilla Resources and iGas — hope that they will be able to start operations at sites in Lancashire and Nottinghamshire this year. –Robin Pagnamenta, The Times, 2 January 2017

A botched green energy scheme that has ignited a political crisis is on course to cost taxpayers more than ¬£1 billion. The Treasury faces the bill after a massive overspend on subsidies encouraging farmers and businesses in Northern Ireland to run eco-friendly power schemes. The Renewable Heat Incentive (RHI) was supposed to cost ¬£25 million in its first five years but the bill is likely to reach ¬£1.15 billion over 20 years. Businesses that signed up could receive ¬£160 from the government for every ¬£100 they spent on fuels, such as wood pellets, burnt in biomass boilers. As people spotted the gains to be made, there was a surge in applications and costs spiralled. –Sean O’Neill and Sean O’Driscoll, The Times, 3 January 2017