World Energy Outlook 2006

Implications for Energy Security
The analysis of the BAPS Case is based on the goal of returning energy-related
CO 2 emissions in 2030 to 2004 levels to mitigate climate change. But many of
the measures and technologies that would enable this goal to be met would also
enhance energy security. Greater diversity in the fuel mix serves a diversity of
purposes.
Meeting the BAPS Case CO 2 goal would reduce oil demand in 2030 to
95 mb/d – around 8 mb/d less than in the Alternative Policy Scenario,
21 mb/d less than in the Reference Scenario and only 10 mb/d more than
today. This implies that the average oil intensity – the amount of oil consumed
per unit of GDP – of the world economy would more than halve between
2004 and 2030. For comparison, oil intensity fell by 46% over the past three
decades worldwide. But global oil demand still increased from 58 mb/d in
1974 to 82.5 mb/d in 2004. The BAPS Case would therefore represent a
significant break with past trends.
Natural gas demand is also reduced. By 2030, it is 6% below the level of the
Alternative Policy Scenario. Most of this reduction comes from lower
demand in the power-generation sector which, with fuel switching to
nuclear power and renewable sources of energy, becomes less reliant on gas.
The volume of gas trade in this case is, therefore, smaller than in the
Alternative Policy Scenario.
Lower oil and gas demand and imports in developing countries would boost
the disposable incomes of households and businesses and the potential for
more rapid economic and human development. This would benefit all
importing nations. Recognition of the mutual energy-security benefits of such
policies would facilitate the establishment of co-operative arrangements
between developing and OECD countries.
Beyond 2030: the Need for a Technology Shift
The above discussion describes some of the policy tools that might be used to
reduce CO 2 emissions by an additional 8 Gt beyond those attained in the
Alternative Policy Scenario. It is clear that achieving this result will be
contingent on the development and deployment of new technologies. The
technology shifts outlined in the BAPS Case would represent a very severe
challenge in terms of their speed of deployment.
Technology development is typically a slow process: decades often elapse
between the initial invention and mass application. In fact, all of the new
technologies analysed in the Alternative Policy Scenario and some in the
BAPS Case are already commercially available and operational. This is
important, because policies to encourage their faster penetration are less
262 World Energy Outlook 2006 - THE ALTERNATIVE POLICY SCENARIO
© OECD/IEA, 2007