The role of fossil fuels declines over time in all of the Energy Outlook scenarios. However, among fossil fuels, natural gas remains more resilient than either coal or oil. Its demand peaks in both the Rapid and the Net Zero scenarios, but not in the Business as Usual (BAU) scenario.
Gas, including biomethane, can play an important role in developing economies by supporting an earlier switch away from coal; in particular, in emerging Asia, where the share of coal in the energy mix is currently high and overall energy demand is growing strongly. It also continues to play a role in the longer term in a decarbonized form, thanks to carbon capture, utilization and storage (CCUS) technology.
Shares of primary energy
In the Energy Outlook scenarios, natural gas continues to play a role in the energy mix while the world moves towards a lower carbon energy system.
An increasing portion of natural gas is decarbonized through the use of CCUS. By 2050, over 40% of gas use in Rapid is either in the form of biomethane or used with CCUS; this increases to around 75% in Net Zero.
In particular, gas is increasingly used as a source for blue hydrogen, which plays an important role in decarbonizing hard-to-abate sub-sectors in transport and industry that are difficult to electrify.
World gas demand
The picture for gas demand (natural gas plus biomethane) is contrasted across the three different scenarios.
In Rapid, gas demand increases as it supports the shift away from coal in emerging economies in both the power and the industry sectors, before peaking in the mid-2030s and declining to today’s levels by 2050. Gas demand increases particularly fast in countries such as India and China, where coal currently represents between 50 to 60% of primary energy.
Meanwhile, gas demand declines in developed economies, such as Europe and the US, due to a combination of lower energy demand and rising use of renewable energy.
Gas consumption in emerging countries - rapid scenario
In Net Zero, stronger energy efficiency, together with higher electrification and hydrogen penetration, means the increase in demand is much shorter-lived. Gas consumption by 2050 is around 35% lower than in 2018.
While more moderate than in Rapid, gas still plays an increasing role in emerging economies in Net Zero, with demand increasing by a quarter over the next decade as it helps to support a shift from coal, before declining in the 2030s. By 2050, gas demand in China and India doubles and quadruples, respectively.
BAU is the only scenario in which gas demand does not peak, with demand increasing across all the different sectors and in almost every region, except Europe.
In all the scenarios, additional investments in gas production are necessary to meet demand. Additionally, both Rapid and BAU show a need for a rapid increase in LNG supplies over at least the next 15 years to support decarbonization in Asia.
Even where gas demand is decreasing – notably, in developed countries – gas infrastructure still remains essential. Why? Through repurposing, it can support a shift to decarbonized and renewable gases.
Take a look at the section on gas in the Energy Outlook.
Explore the report, download the data or watch the replay of Spencer Dale's 2020 presentation