Fossil Future World Energy Consumption

and the European Energy Security in the Next Twenty Years

Guest Lecture Series of the School of International StudiesUniversità di Trento – 4 Marzo 2013

Matteo Verda, Istituto per gli Studi di Politica Internazionale (ISPI) – Milano

What’s energy?

Fossil Future – Introduction to the issue

Energy is…

• …the capacity of a system to do work

• …an input for any economic activity

• …the sources we use

• …an issue among other issues

Energy and economic growth

Fossil Future – Introduction to the issueSources: IMF, online database and BP, Statistical Review of World Energy 2013

World total European Union

GDP

PEC

PEC

GDP

Gross domestic product (GDP) and primary energy consumptions (PEC) trends (1979 = 100).

Primary energy consumption – World

Fossil Future – Energy consumption and mixSource: EIA, World Energy Outlook 2013

Fossil fuels account for 82% (10.668 Mtoe) of World total primary energy consumption (2011).

Primary energy consumption – Major economies

Fossil Future – Energy consumption and mixSource: EIA, World Energy Outlook 2013 (2011)

2.743 Mtoe – 88% 2.189 Mtoe – 84% 1.659 Mtoe – 75%

750 Mtoe – 72% 718 Mtoe – 91% 461 Mtoe – 90%

Primary energy consumption – Breakdown

Fossil Future – Energy consumption and mixSource: EIA, World Energy Outlook 2013 (2011)

Energy mix breakdown: China, USA and EU (Mtoe).

EU energy policy: targets

Fossil Future – The EU’s place in the World

2020 targets

• 20% share of energy from renewable sources (national)

• 20% reduction in EU greenhouse gas emissions from 1990 levels

2030 targets (proposed)

• 27% share of energy from renewable sources (EU level)

• 40% reduction in EU greenhouse gas emissions from 1990 levels

EU’s share of World total consumption – Breakdown

Fossil Future – The EU’s place in the WorldSource: EIA, World Energy Outlook 2013 (2011)

Note: EU is the largest economy in the World (17,3 T$ - 23%), preceding the US (16,7 T$ - 22%) and China (8,9 T$ - 12%) (2013, IMF).

EU and World energy consumption: forecasts

Fossil Future – The EU’s place in the World

In 2030, fossil fuels are bound to account for two third of the EU energy consumption and for more that three quarters of the World total energy consumption.

Source: EIA, World Energy Outlook 2013

EU’s share of World total consumption: 2030 forecasts

Fossil Future – The EU’s place in the WorldSource: EIA, World Energy Outlook 2013

-4 p.p. -4 p.p.Variation2011-2030

-4 p.p. -3 p.p. -15 p.p. -2 p.p. -5 p.p. -2 p.p.

EU energy policy: the carbon issue and the European targets

Fossil Future – The carbon issue

Carbon issue

• Supposed climate change

• Supposed causation link between carbon emissions and climate change

• Action pattern: reduction of carbon emissions

European targets

• 2020 : 20% reduction in greenhouse gas emissions from 1990 levels

• 2030 : 40% reduction in greenhouse gas emissions from 1990 levels

EU emissions and future targets

Fossil Future – The carbon issueSource: EIA, World Energy Outlook 2013

EU and World carbon emissions: current levels and forecasted trends (Mt CO2).

European Union World total

EU’s share of World carbon emissions: forecasts

Fossil Future – The carbon issueSource: EIA, World Energy Outlook 2013

EU’s share of carbon emissions: current levels and forecasted trends (Mt CO2).

EU carbon emissions vs. major economies emissions

Fossil Future – The carbon issueSource: EIA, World Energy Outlook 2013

EU’s share of carbon emissions compared with other main economies (Mt CO2).

Carbon emissions change (2011-2030): EU vs. major economies

Fossil Future – The carbon issueSource: EIA, World Energy Outlook 2013

Expected emissions change (Mt CO2).

Reduction vs. mitigation

Fossil Future – The carbon issue

Mitigation

Mitigation is the effort to reduce loss of life and property by lessening the

impact of disasters. Mitigation is taking action now—before the next

disaster—to reduce human and financial consequences later.

Reduction

Reduction is the effort to act now on the causal factors in order to reduc e

a probable outcome in the future.

Thank you!

Contacts

Matteo Verda, Istituto per gli Studi di Politica Internazionale (ISPI), Milano

mail: matteo.verda@unipv.it

blog: www.sicurezzaenergetica.it

Twitter: @matteoverda

Linkedin: Linkedin/in/matteoverda

Addendum – Ukraine

Russia export routes and Ukrainian supply

Ukraine 2012

Consumption 53 Bcm

Production 20 Bcm

Imports 33 Bcm

Gas share of energy mix 36%

Pipeline Max capacity

Nord Stream 55 Bcm/y

Yamal – Europe 35 Bcm/y

Ukraine pipeline system 100 Bcm/y

Blue Stream 16 Bcm/y

Source: BP, Statistical Review of World Energy 2013

(approx.)

In 2013, Russian exports to Central and Wester Europe amounted to 153 Gmc/c.

Addendum – Ukrainian crisis

European countries vulnerability

Country Dependence Main route

Hungary high (>50%) Ukrainian p.s.

Czech Republic high (>50%) Ukrainian p.s.

Bulgaria total (100%) Ukrainian p.s.

Poland high (>50%) Yamal - Europe

Slovakia total (100%) Ukrainian p.s.

Estonia total (100%) direct

Finland total (100%) direct

Latvia total (100%) direct

Lithuania total (100%) Belarus

Sources: BP and Eurogas Addendum – Ukrainian crisis

Italy – Diversification of the pipeline system

Italy – Structurally and seasonally low demand

Italian natural gas demand is structurally and seasonally low (Bcm).

Sources: Snam Rete Gas and Ministero dello sviluppo economico Addendum – Ukrainian crisis

imports

production

winter

summer