Three Drivers for Energy Demand
Energy use will be increasingly efficient and less carbon intensive than it is today
Policy. Technology. Consumer preferences. All three impact how the world uses energy. Each driver influences the other. The interplay between these can vary depending on local circumstances (available resources, public support) and can change over time. At ExxonMobil, we are continually studying energy demand and developing models that measure its potential impact—all in an effort to gain a deeper understanding of the interconnectivity of the global energy system.
Almost half of the world’s energy use is dedicated to industrial activity
As the global middle class continues to grow, demand for durable products, appliances and consumable goods will increase. Without exception, industrial activities are required to manufacture these products and their components. Industrial activities, such as textile manufacture, car assembly or creation of construction materials, take place in almost all regions, and for all this activity energy is required.
Industry is growing in emerging markets such as India, Southeast Asia, the Middle East and Africa. Industry is also evolving in OECD nations as businesses and consumers strive to reduce their environmental impact by using energy more efficiently.
Industrial growth takes energy. It also takes innovation. The ExxonMobil Energy Outlook anticipates technology advances, as well as the increasing shift toward cleaner sources of energy such as electricity and natural gas. The industry of the future will be more energy efficient and less carbon intensive than it is today.
The rise of global electricity demand to 60pc of energy use
Since it first started lighting homes in the late 1800s, electricity has provided the means to boost economic productivity and improve the human condition with modern conveniences like electric motors, air conditioning and refrigeration. Power generation has witnessed transitions in fuel sources from coal to nuclear and gas, and now we are harnessing wind and solar energy. The growth of new energy sources is impacted by factors such as technology cost improvements, the availability and quality of domestic resources, and government policies.Choosing natural gas as a cleaner-burning alternative to coal improves air quality and reduces carbon intensity
Electricity demand is expected to grow around the globe, supplied primarily by growth in wind, solar, natural gas-fired and nuclear generation. Besides meeting residential, commercial and industrial demand, the increase in electricity demand is also fuelled by the growth of electric vehicles in light-duty transportation. Cost reductions in transportation batteries are being leveraged for other applications including larger-scale electricity storage.
Today, batteries represent a small share of installed capacity on the grid and are used for short-duration storage. The increased variable production from weather-dependent wind and solar triggers additional transmission build-out, storage and flexible gas peaking generation but results in reduced asset efficiency. Further breakthroughs that provide new solutions deployable at commercial scale to maintain reliable and affordable electricity for consumers are needed.
Natural gas satisfies energy needs while helping to mitigate climate change
Choosing natural gas as a cleaner-burning alternative to coal improves air quality and reduces carbon intensity. Natural gas is also abundant and versatile. It is a reliable and flexible fuel for electricity generation, a cleaner industrial fuel and convenient for home use. According to the ExxonMobil Outlook for Energy1 natural gas grows more than any other energy source, rising from 23pc of global energy supply in 2017 to 26pc in 2040.26pc Share of gas in global energy supply in 2040
Natural gas resources are geographically and geologically diverse. North America’s unconventional gas resources are produced by applying horizontal drilling and hydraulic fracturing technologies. The Middle East and Africa are expected to tap large conventional natural gas resources. Natural gas production is expected to grow in every region except Europe.
Natural gas trade is a critical link between resource-rich regions and demand centers in Asia-Pacific and Europe. New liquefied natural gas export projects are expected to diversify the market and meet 40pc of the growth in natural gas demand to 2040.
To learn more about ExxonMobil’s LNG business please visit exxonmobilLNG.com.
https://corporate.exxonmobil.com/Energy-and-environment/Looking-forward/Outlook-for-Energy
