international energy outlook 2018 (ieo2018) - eia.gov · • energy consumption in the non-oecd...

www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis

International Energy Outlook 2018 (IEO2018)

forCenter for Strategic and International StudiesJuly 24, 2018 | Washington, DC

byDr. Linda Capuano, AdministratorU.S. Energy Information Administration

• Energy consumption in the non-OECD countries began to exceed OECD consumption in 2007 and is projected to reach nearly two-thirds of the 739 quadrillion Btu global energy consumption in 2040

• The world’s energy consumption through 2040 increases, on average, for all fuels in the IEO2018 Reference case

• The IEO2018 side cases show higher economic growth drives increasing energy consumption, while services or manufacturing pathways to growth modulate that consumption

• Per capita energy consumption in India and Africa remain comparatively low despite high economic growth in the IEO2018 side cases

• IEO2018 side cases highlight the need to further explore the relationship between high economic growth, relative sizes of the services and manufacturing sectors, and energy consumption

Dr. Linda Capuano, CSIS IEO2018, July 2018

Key takeaways

2

266

473

0

100

200

300

400

500

1990 1995 2000 2005 2010 2015 2020 2025 2030 2035 2040

Non-OECD

OECD

Source: EIA, International Energy Outlook 2018


Non-OECD nations are projected to account for 64% of the 739 quadrillion Btu global energy consumption by 2040IEO2018 Reference caseworld energy consumptionquadrillion Btu

3

ProjectionHistory

50 78

157200 224

257303

0

100

200

300

400

500

1990 2000 2010 2015 2020 2030 2040

Africa



Asia is projected to have the largest increase in energy use of non-OECD regionsIEO2018 Reference casenon-OECD energy consumption by regionquadrillion Btu

4

Asia

Middle East

AmericasEurope andEurasia

History Projection

356410

523575

610661

739

1.7%

0.4%

1.5%

1.6%

2.0%

2.1%

2.3%

2.4%

0% 2% 4% 6%

Total OECD

Japan

OECD Europe

Canada

South Korea

United States

Mexico/Chile

Australia/New Zealand

4.1%

1.4%

1.6%

2.4%

2.5%

3.1%

3.8%

4.2%

4.5%

6.0%

0% 2% 4% 6%

Total Non-OECD

Russia

Brazil

Other Americas

Other Europe/Eurasia

Middle East

Africa

Other Asia

China

India

IEO2018 Reference caseaverage annual percent change in real GDP by region, 2015–40


Many non-OECD countries are projected to lead global economic growth

Dr. Linda Capuano, CSIS IEO2018, July 2018 5

OECD Non-OECD

229

182161

38

129

0

50

100

150

200

250

1990 2000 2010 2020 2030 2040

ProjectionHistory

petroleum and other liquids

coal

natural gas

renewables

nuclear



World energy consumption increases for fuels other than coalIEO2018 Reference case world energy consumption by energy sourcequadrillion Btu

6

211237 245 255

276

181 196206

227259

0

50

100

150

200

250

300

350

2010 2015 2020 2030 2040

industrial all other end-use sectors



The industrial sector accounts for the largest share of world energy consumptionIEO2018 Reference caseworld delivered energy consumption in the industrial and all other end-use sectorsquadrillion Btu

7

History Projection

9% 12% 13%

51%33%

16%

33%

42%

47%

5% 12%15%

3% 1%9%

0%

25%

50%

75%

100%

China India Africa

mining

agriculture

services

manufacturing

construction



Sector shares in China, India, and Africa start at different points in 2015

sector share of total gross output in 2015percent

8

• China: Two cases that assume GDP will grow 5.7%/year from 2015 to 2040, compared with 4.5%/year in the IEO2018 Reference case

– A more rapid transition to a consumption-led economy and increased demand for services; the personal consumption share of GDP rises to 60% by 2040, compared with 50% in the IEO2018 Reference case

– China continues its large industrial investment- and export-led growth; the investment share of GDP is 51% in 2040, compared with 32% in the IEO2018 Reference case

• India: Three cases that assume GDP will grow about 7.1%/year from 2015 to 2040, compared with 6.0%/year in the IEO2018 Reference case

– An investment-led economy with more industrial sector investment; the investment share of GDP rises from 29% in the IEO2018 Reference case in 2040 to 38%, loosely patterned after China’s recent growth

– An export-led economy with more output from trade-sensitive, energy-intensive industries such as chemicals and refining; the export share of GDP increases from 23% in the IEO2018 Reference case in 2040 to 55%, loosely patterned after South Korea

– A personal consumption-led economy with more output from services; the personal consumption share of GDP rises from 61% in the IEO2018 Reference case in 2040 to 67%, loosely based upon current U.S. levels of personal consumption

• Africa: One case that assumes GDP will grow 5.0%/year from 2015 to 2040, compared with 3.8%/year in the IEO2018 Reference case


IEO2018 examines comparative economic growth cases in China, India, and Africa

9



China’s GDP and energy consumption growth have slowed in recent years

Chinese GDP and energy consumptionannual growth rate, five-year moving average

10

0%

5%

10%

15%

1983 1991 1999 2007 2015

China GDP

China total primary energy consumption



Industrial sector growth is projected to result in energy consumption differences

Chinese delivered energy consumption in 2040quadrillion Btu

11

85

6680

52

44

52

0

30

60

90

120

150

No Transition IEO2018 Reference Fast Transition

all other end-usesectors

industrialsector

17% 12% 11%

40%39% 38%

41% 46% 48%

0%

25%

50%

75%

100%


miningagriculture

services

manufacturing

construction



Small changes in the manufacturing share of total gross output drive larger changes in energy consumptionsector share of total gross output in 2040percent

12



China’s economic growth in the side cases leads to gains in its share of global energy-intensive goods productionregion share of global energy-intensive sector gross output in 2040percent

13

41% 35% 40%

15%16% 16%

10% 11% 11%7% 8% 7%7% 7% 7%

20% 22% 20%

0%

25%

50%

75%

100%


Rest of World

United StatesMiddle East

other non-OECD Asia

India

China



India’s per capita income and energy consumption continue to lag other major economiesIEO2018 Reference case energy consumption per capitamillion Btu per person

2000---------2015---------2040 IEO2018 Reference case projection

14

China

India

Russia

South KoreaUnited States

0

50

100

150

200

250

300

350

400

0 20,000 40,000 60,000 80,000GDP per capita2010 U.S. dollars per person

Africa



Differences in energy consumption between India’s high-growth cases are smallIndian energy consumption in 2040quadrillion Btu

15

31

40 41 43

19

23 23 23

0

10

20

30

40

50

60

70

IEO2018 Reference Consumption-led Investment-led Export-led

all otherend-usesectors

industrialsector



When starting from similar levels of GDP per person, India’s energy-intensive production does not reach historic Chinese production levels until after 2035energy-intensive manufacturing gross output2010 U.S. dollar index, selected start year = 100

16

0

100

200

300

400

500

600

700

800

900 China2000–2015

India (Export-led)2006–2040

2006

2000

2015

2040

2037

Source: IHS Markit and Oxford Economics


Services are the largest share of GDP for six countries that represent nearly two-thirds of African GDP

17

Country Services share Manufacturing share

South Africa 71% 13%

Morocco 62% 16%

Nigeria 59% 9%

Egypt 52% 13%

Algeria 44% 5%

Angola 44% 5%



Faster economic growth in Africa leads to an increased share for the manufacturing sector and a lower share for services compared with the IEO2018 Reference casesector share of total gross output in 2040percent

18

18% 20%

19%24%

47% 37%

10% 11%

7% 9%

0%

25%

50%

75%

100%

IEO2018 Reference Africa High Growth

mining

services

construction

agriculture

manufacturing



Manufacturing energy consumption increases more than nonmanufacturing energy consumption when compared with the IEO2018 Reference case in 2040industrial sector energy consumption in 2040quadrillion Btu

19

2.2

7.9

3.9

2.7

10.9

4.9

0 2 4 6 8 10 12

Nonmanufacturing

Nonenergy-intensivemanufacturing

Energy-intensivemanufacturing

Africa High GrowthIEO2018 Reference

• What is surprising?

• What is expected?

• What are your insights?

• Which topics would you explore more deeply?


Key IEO2018 questions for panelists

20

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International Energy Statistics database | www.eia.gov/ies

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For more information

21

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