The outlook for industrial energy demand is dominated by the changing energy needs of China.
After tripling over the past 20 years, Chinese industrial energy demand in the ET scenario peaks in the mid-2020s and gradually declines thereafter. Some of this decline stems from policy efforts to improve the efficiency of existing industries. In addition, it reflects the continuing transition of the Chinese economy away from energy-intensive industrial sectors towards less-intensive service and consumer-facing sectors.
The transition in the Chinese economy means much of the growth in industrial production is located outside of China, with India, Other Asia and Africa accounting for around two-thirds of the increase in industrial energy demand over the Outlook.
All of the net growth in industrial demand is met by natural gas and electricity, with these fuels accounting for around two-thirds of the energy used in industry by 2040. Coal consumption within industry declines as China, the EU and North America switch to cleaner, lower-carbon fuels, partially offset by growth in India and Other Asia.