World Energy Outlook 2007

The projections presented in this study are underpinned by a vast datacollection
and modelling effort. Major improvements have been made to the
IEA’s World Energy Model, 1 including a more detailed representation of enduse
sectors in China and India, disaggregated regional models for China and
rural-urban models for India (Box 1). Considerable work was also devoted to
verifying the accuracy of energy data (see Chapters 8 and 15). The analysis also
benefited from major workshops in Beijing and New Delhi in March 2007,
organised specifically to provide input for our work, as well as a high-level
brainstorming meeting held at the IEA headquarters in Paris in May 2007.
This study would not have been possible without the close co-operation of
China’s National Development and Reform Commission and the Energy
Research Institute in Beijing, The Energy and Resources Institute (TERI) in
New Delhi and other public and private bodies in China and India. The
analysis of macroeconomic linkages and interactions with energy markets also
benefited from collaboration with the Centre International de Recherche sur
l’Environnement et le Développement (CIRED), a French research institute.
The IEA’s Coal Industry Advisory Board provided valuable input to the
analysis of coal prospects. The International Institute for Applied Systems
Analysis (IIASA) assisted with the analysis of local environmental issues. Other
international organisations involved included the World Bank, the Asian
Development Bank and the International Monetary Fund, all of which made
important contributions to the work.
The Reference Scenario
The Reference Scenario is defined in the same way as in previous editions of
the Outlook. It is designed to show the outcome, on given assumptions about
economic growth, population, energy prices and technology, if nothing more
is done by governments to change underlying energy trends. It takes account
of those government policies and measures that had already been adopted by
mid-2007, regardless of whether they have yet been fully implemented –
even though the impact on energy demand and supply of the most recent
measures does not show up in historical market data. 2 In some cases, policies
that were under consideration in 2006 and were included in the Alternative
Policy Scenario last year have since been adopted and have, therefore, now
been taken into account in the Reference Scenario. These include measures
to boost biofuels in the United States, new measures to promote renewables
in the European Union and Japan, the national allocation plans for the
1. Details of the WEM are available at the WEO website at www.worldenergyoutlook.org.
2. Available only up to 2005 for all countries and to 2006 for some fuels and some countries.
Introduction 57