Outlook to 2035 - energy use to rise by a third

Energy consumption is expected to increase by 34% between 2014 and 2035, according to BP’s Energy Outlook

The extra energy is required because of the expected growth in the world economy as well as the rising global population. 

This increase is projected in BP’s ‘base case’, which outlines the most likely path for energy demand by fuel based on assumptions about future changes in policy, technology and the economy. The Outlook also explores the uncertainties around the base case using a number of alternative cases. 
In the base case, the world’s GDP (gross domestic product) is expected to more than double – around one-fifth of the doubling being due to population growth and four-fifths to improvements in productivity. China and India together account for almost half of the projected increase in global GDP, with OECD (Organisation for Economic Co-operation and Development) economies accounting for around a quarter.   

The world’s population is projected to increase by around 1.5 billion people to reach nearly 8.8 billion people by 2035. 

Virtually all of the additional energy is consumed in fast-growing emerging economies. Energy demand within the OECD barely grows. Growth in China’s energy demand slows as its economy rebalances towards a more sustainable rate.  
Energy consumption is expected to increase by 34% by 2035

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Animation highlights of the BP Energy Outlook 2035

By the final decade of the Outlook, China contributes less than 30% of global energy growth, compared with nearly 60% over the past decade.

Oil and gas remain key

Fossil fuels remain the dominant source of energy powering the global economy, providing around 60% of the increase in energy and accounting for almost 80% of total energy supplies in 2035. 

Gas is the fastest growing fossil fuel at 1.8% per annum, with its share in primary energy gradually increasing. Oil grows steadily at 0.9% p.a., although the trend decline in its share continues. The combined increase of oil and gas over the Outlook is similar to the past 20 years.

In contrast, coal suffers a sharp reversal in its fortunes. After gaining share since 2000, the growth of coal is projected to slow sharply at (0.5% p.a.), compared with almost 3% p.a. over the past 20 years, such that by 2035 the share of coal in primary energy is at an all-time low, with gas replacing it as the second-largest fuel source. 

Among non-fossil fuels, renewables (including biofuels) grow rapidly at 6.6% p.a., causing their share in primary energy to rise from around 3% today to 9% by 2035.  

More than half of the increase in global energy is used for power generation as the long-run trend towards global electrification continues, particularly benefiting those who currently lack adequate access to electricity in regions such as Asia and Africa.
Fossil fuels are expected to provide around 60% of the increase in energy to 2035
Virtually all of the additional energy is consumed in fast-growing emerging economies. Energy demand within the OECD barely grows.
While coal slows and renewables advance, the combined increase of oil and gas in the next 20 years is similar to that of the last 20 years

Oil market gradually rebalances

The oil market gradually rebalances, with the current low level of prices boosting demand and dampening supply. The increase in consumption of liquid fuels is largely driven by the increase in the global vehicle fleet, which more than doubles from around 1.2 billion today to 2.4 billion by 2035. 

The efficiency of the vehicle fleet increases substantially, improving by 2-3% p.a. compared with 1.5% p.a. over the past decade. As a result, in 2035, an average passenger car is expected to achieve 50 miles per gallon, compared with only 30 miles per gallon today.
Renewables are projected to be the fastest growing fuel, whilst global coal demand is hit by the deceleration in China’s coal consumption (*Renewables includes biofuels)

Demand for natural gas grows strongly

Demand for natural gas grows by 1.8% p.a., making it the fastest growing fossil fuel.  This robust growth is helped by ample supplies and supportive environmental policies. The majority of the increase in demand comes from emerging economies, with China and India accounting for around 30% of the increase and the Middle-East over 20%.

Renewables continue to grow rapidly

Renewables are projected to be the fastest growing fuel, almost quadrupling (6.6% p.a.) over the Outlook. 

The EU continues to lead the way in the use of renewable power.  However in terms of volume growth to 2035, the EU is surpassed by the US, and China adds more than the EU and US combined.

The rapid growth in renewables is supported by the expected pace of cost reductions: the costs of onshore wind and utility-scale solar PV are likely to fall by around 25% and 40% over the next 20 years.

China’s changing coal consumption

A majority of the slowdown in the growth of global coal demand can be accounted for by the deceleration in China’s coal consumption as its economy rebalances. 

Even so, China remains the world’s largest coal market, consuming almost half of global coal supplies in 2035.  India is the largest growth market for coal (435 Mtoe), overtaking the US to become the world’s second biggest consumer of coal.  

Coal demand in both the US and OECD Europe is projected to fall by more than 50%, driven by plentiful supplies of gas, falling cost of renewables, and stronger environmental regulation.
Renewables are projected to be the fastest growing fuel, up 6.6% p.a. to 2035

Hydro and nuclear generation grow steadily

Both hydro and nuclear energy are projected to increase steadily, growing at 1.8% p.a. and 1.9% p.a. respectively.  

China’s nuclear output increases rapidly (11.2% p.a.) over the Outlook more than doubling by 2020 and increasing nine-fold by 2035.

Nuclear output declines in the EU (-29%) and North America (-13%), as ageing plants are gradually decommissioned and the economic and political challenges of nuclear energy stunt new investments.

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