ENERGY SCENARIOS TO 2050

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ENERGY SCENARIOS TO 2050
Pisa, July 17, 2006
ASPO France
JM Bourdaire
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CONTENTS

• INTRODUCTION THE RISING CRISIS
• PART I WHAT DOES THE PAST SAY?
• PART II UNRELIABLE GDP DATA
• PART III  CONVEX  OR  CONCAVE ?
• PART IV FINAL ENERGY FOR WHAT?
• CONCLUSION PROPOSED SCENARIOS

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INTRODUCTION THE RISING CRISIS
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NON ME OIL PRODUCTION
Peak is approaching!
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A PLAUSIBLE OIL EVOLUTION
Will troubles start at the beginning of the
2010s?
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A TSUNAMI-LIKE CRISIS?

• OIL The 2010 (?) oil peak will reduce the world
  GDP growth and kill the recent GDP surge
• NATURAL GAS The 2030 (?) gas peak will be
  another blow against the potential GDP growth
• COAL By 2040-50 (?) coal inability to meet power
  and CTL demand may further reduce GDP growth

IF SUPPLY IS SHORT, DEMAND WILL ADJUST BY PRICE
SHOCKS AND RECESSIONS
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PART I PAST WORLD EVOLUTION
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IMPACT OF THE FIRST SHOCK
First impact Energy intensity has declined since
1973
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WORLD ENERGY INTENSITY
The decline of energy intensity since 1973
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WORLD ENERGY GROWTH
Second impact World GDP growth has declined
since WWII, Yet with a recent rebound
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POPULATION PEAKS IN 2040-50
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PART II UNRELIABLE GDP DATA
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PART III CONVEX OR CONCAVE?
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WHAT FUTURE EVOLUTION?
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RED OR BLUE?

• All published scenarios are of the  red  type
  with acceptability, i.e. environment and GHG
  emissions, the binding constraint
• Yet, in  blue  type scenarios, the constraints
  are on availability and access to the poor, but
  GHG concentrations hardly reach 550 ppm

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WORLD GROWTH 2000-50 1.5?
With the strong economic recessions that the
future oil shocks will create, future GDP growth
could be as bad as the linear extrapolation of
the past.
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SO, IS IPCC RIGHT OR NOT?
In red, IPCC concave energy paths
In blue, the convex energy paths
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PART IV FINAL ENERGY FOR WHAT?
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CONCLUSION TWO PROPOSED SCENARIOS
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THE IDEAL 2050 SCENARIO
French saying With ifs, one could put Paris
in a bottle

• World political consensus brings similar and
  converging policies
• adopted domestically by many countries
• avoiding international wealth redistribution
  (US opposes it)
• Tax money is explicitly recycled to the citizens
  within each country

• Proactive scenario with true market prices
  full property rights
• calling for subsidies removal and
• introducing security of supply environmental
  externalities
• New laws trigger the enforcement of actual
  property rights in DC

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WORLD IDEAL 2050 SCENARIO
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THE LIKELY 2050 SCENARIO
Murphys law If things can go wrong, they will

• National policies contradict each other
• with a lot of wishing thinking on efficiency and
  renewables
• with spectacular but ineffective decisions
• Resulting in stop and go macroeconomic and
  energy policies

• Reactive scenario with Muddle trough-type
  national policies
• no systematic removal of subsidies and
• imposed energy quota whatever their dual cost
• Insecure property rights in most poor countries
  hamper development

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WORLD LIKELY 2050 SCENARIO
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A CONVEX TPER EVOLUTION
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TPER OVER TIME
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A LAST WORD

• Explanations of my assumptions detailed results
  (e.g. the respective world GDP growth of 1.4 and
  1.7) are provided in my paper LT-
  scenarios.doc
• I am indebted to Colin Campbell, Jean Laherrere
  and Matthew Simmons for their studies, basis of
  my analysis of the challenges laying ahead of
  humanity
• Thanks also to Cheniere Energys chairman, Charif
  Souki, who has supported this work and allowed me
  to present it at ASPO-5 on behalf of ASPO France