World Energy Outlook 2007

CHAPTER 2
ENERGY TRENDS IN CHINA AND INDIA
HIGHLIGHTS
China’s and India’s importance in world energy will continue to grow
steadily over the coming decades, reflecting rapid economic
development, industrialisation, urbanisation and improved quality of
life. In the Reference Scenario, primary energy needs expand at an
average annual rate of 3.2% in China and 3.6% in India – much faster
than in the rest of the world. Together, they account for 45% of the
increase in world energy demand through to 2030.
All primary fuels except biomass see continuing growth in demand in
both countries over the projection period. Their economies remain
heavily dependent on coal, mostly produced indigenously. By the end
of the projection period, coal – used mainly in power stations – makes
up 59% of the two countries’ combined energy use, up from 57% in
2005. Oil demand also grows swiftly in both countries. Their
combined oil use increases from 9.3 mb/d in 2005 to 23.1 mb/d in
2030 – growth of 3.7% per year and 42% of the global increase in oil
demand in 2005-2030.
Chinese and Indian output of coal expands over the Outlook period,
but not quickly enough to keep pace with demand. Coal imports rise
markedly in India, while China emerged as a net importer in 2007, and
its imports are projected to reach 92 Mtce in 2030. Oil production
falls between now and 2030 in both China and India. Consequently,
net imports surge, from 3.5 mb/d in 2006 to 13.1 mb/d in 2030 in
China and from 1.9 mb/d to 6 mb/d in India.
In the Alternative Policy Scenario, energy demand in China and India
grows more slowly as existing government policies to curb demand
growth are enforced more strictly and new policies now being discussed
are introduced. Primary demand expands by 0.7 percentage points less
per year in China and 0.8 points less in India than in the Reference
Scenario. In both countries, coal demand falls most thanks to more
efficient coal-burning technology, especially in power stations, and
switching to less carbon-intensive fuels and zero-carbon technologies,
including nuclear power and renewables.
In the High Growth Scenario, by contrast, faster economic
development drives energy demand higher. In China, primary energy
demand in 2030 is nearly a quarter higher than in the Reference
Scenario. In India, the increase is 16%. Coal and oil account for most
of the increase in both countries’ primary energy demand. Together,
China and India account for 54% of the increase in world primary
energy demand between 2005 and 2030 in the High Growth
Scenario.
Chapter 2 - Energy Trends in China and India 117