Energy demand, supply and security- What impacts will the BRICs have? Why?
From the Spec: 1.3: Demand for energy is growing globally, and at regional and local scales, especially in developed and emerging economies such as China and India Examine: Trends in global energy supply and demand by source, Type of economy and economic sector 1.4: Energy security depends on resource availability (domestic and foreign) and security of supply which can be affected by geopolitics, and is a key issue for many economies Develop an awareness that there is little excess capacity to ease pressure on energy resources and therefore energy security is rising particularly for finite resources P17-21 Oxford textbook
What does it mean to be energy secure? <ul><li>To have ENERGY SECURITY means to have access to reliable and affordable energy sources </li></ul><ul><li>E.g. Russia </li></ul><ul><li>Countries that do not have this are said to be ENERGY INSECURE </li></ul>
The energy security square ENERGY SECURITY DOMESTIC RENEWABLES INTERNATIONAL ENERGY PATHWAYS DOMESTIC SOURCES OF FOSIL FUELS FOERIGN SOURCES OF FOSSIL FUELS <ul><li>Moderate security- </li></ul><ul><li>Ability to develop reliable, cost effective renewable resources </li></ul><ul><li>Strongly linked to physical factors- wind, land, water supply and sun </li></ul><ul><li>Low security- </li></ul><ul><li>Safe and secure transport by sea or pipeline </li></ul><ul><li>Routes can be disrupted by piracy, war, political tension weather </li></ul><ul><li>High security- </li></ul><ul><li>Economically recoverable supply of coal, oil, gas </li></ul><ul><li>Technology required to extract and process fossil fuels to use them </li></ul>Moderate security- *Ability to buy fossil fuels from ‘friendly’ sources on international market at affordable prices * Supply can be disrupted by conflict and technical extraction difficulties
Different energy resources coal wind biomass oil The Sun is the original source of most energy resources. natural gas food waves Which of these energy resources are non-renewable?
Energy Issues across the world Dependency; wastefulness; lack of fossil fuel supply (energy insecurity) Huge surplus; inefficient use; energy as a political weapon? Rapidly growing demand; use of pollution sources such as high sulphur coal; health impacts; impact on global fossil fuel prices Energy poverty; dependency on foreign TNCs to exploit supply (Nigeria, Sudan) Supply security; role of unstable regions in fossil fuel supply; link between nuclear power and weapons. Reserves; questions of developing these in the Arctic, Antarctic and other sensitive areas
Who consumes all the energy?
World Energy consumption Describe the trend
<ul><li>Figure 6.1 World energy consumption apportioned according to energy sources (source: IEA World Energy Outlook 2006) </li></ul>
What changes are coming? Why? What will be the impacts (SEEP)? The following slides are just an overview Use the articles to answer the questions in detail – present how you wish
<ul><li>Preventing India's energy from being stolen from its grid would improve efficiency. Getting China to cut back on coal is crucial. Ironically, "clean" coal technology growth in China is being stymied by Western interests' fear of giving the booming Chinese economy that competitive leg up. Shirong Chen, China editor, BBC News: "What if China got all this clean coal technology and their economy would develop even faster? What would happen to the big economies like the USA and India?" </li></ul>
<ul><li>Both China and India have nuclear energy programs and the rest of the world is more than a little uneasy about them. Australia just announced it will not sell uranium to India because India is not a signatory to the Nuclear Non-Proliferation Pact. Meanwhile, there's a dark horse coming up on the outside in the race, New Energy. China is aggressively developing solar and India’s Suzlon is one of the world leaders in wind. China’s goal is to get 15% of its electricity from New Energy by 2020. India intends to get 10% by 2012. And nobody is taking any kind of interest except a business interest. Leaders in the U.S. Senate last month rejected a commitment to get 15% of U.S. electricity from New Energy by 2020 on the grounds that many southeastern states could not meet that standard. Tennessee, Alabama and Mississippi aren’t capable of doing what India and China are doing? </li></ul>
<ul><li>WHAT Energy demand growth in China and India is driving world markets and shows no sign of letting up. Despite recent agreements between the 2 countries, competition for supplies is heated. WHEN - In 1993, China did not import oil. By 2030, it will import as much as the U.S. - By 2030, India’s oil imports will be greater than those of Japan or the European Union. </li></ul>
WHERE - In Beijing and Delhi, the race for oil deals in Latin America, Central Asia and Africa is a critical concern. - China seems less inhibited about doing business with governments shunned by the West like Iran, Burma and Venezuela. WHY - China’s economy is based on manufacturing, India’s is strongly service-based. This makes China even more energy-hungry. - India’s more open, democratic political system puts it at a disadvantage. e.g. A nuclear deal is being blocked in India by anti-U.S. politics while China is expanding nuclear plans at the government leadership’s will. But neither country will get more than 4% of its power from nuclear in 2020. - Both India and China are developing wind, biomass, solar and hydro-electric energy resources. - India has enormous undeveloped hydroelectric resources.
China’s and India’s net oil imports are expected to jump to 19.1 million barrels a day in 2030 from 5.4 million barrels in 2006, more than what the United States and Japan now import. By 2030, global oil demand is expected to reach 116 million barrels a day. The use of coal, made attractive by oil and natural gas prices, is expected to rise 73 percent in the next 25 years, mostly because of Chinese and Indian use. The share of natural gas is projected to increase modestly while electricity use doubles.
<ul><li>High economic growth in China and India could push oil prices to $159 a barrel by 2030, the agency said. Fatih Birol, the agency’s chief economist and the lead author of its flagship publication, The World Energy Outlook 2007, presented today, said that while economic growth should be encouraged because it helps to meet increasing energy demand through fostering innovation, it needs to happen in tandem with policies for energy efficiency. </li></ul><ul><li>Mr. Birol called on the Chinese government to put standards and quotas in place that would allow the country to grow while slowing energy consumption and carbon emissions. Car sales in China, which overtook Japan last year and are expected to overtake the United States by 2015, contribute to rising oil demand and harm the environment and are an area where new policies could take effect, he said. “We’re not running out of energy or money, but we’re running out of time,” Mr. Birol said. </li></ul><ul><li>The agency said the immediate adoption of policies, including tougher efficiency standards for air-conditioners and refrigerators in India and China, would result in China saving the amount of power produced by the enormous Three Gorges dam by 2020 and India profiting from a reduction of pollution. </li></ul><ul><li>The next decade is crucial for the stability of the global energy system, the agency said. Decisions made today in China and India — for example, whether to continue investment in coal-fired power plants or to adopt policies to tackle global warming — will have worldwide consequences for decades. </li></ul>
<ul><li>China’s and India’s energy use is projected to double from 2005 to 2030. By 2030, the two countries will account for nearly half the increase in global demand. China is expected to overtake the United States as the world’s top carbon emitter this year and the largest energy consumer soon after 2010, the agency said. In India, where more than 400 million people have no access to electricity, energy demand is expected to more than double by 2030. </li></ul><ul><li>China and India argue that it is unfair to blame them for rising energy prices, and they have resisted calls to limit carbon emissions when their economies are trying to catch up with development levels in the West. Energy use per person in those countries remains much lower than in the industrial nations. </li></ul><ul><li>In its report, the energy agency recognized the legitimate aspirations of China and India to improve the lives of their people. It said, moreover, that solving energy problems is a global responsibility that demands action by all countries. </li></ul><ul><li>“ The challenges are global so solutions are global,” Mr. Tanaka said. “The global energy system is on an increasingly unsustainable path. Policies can make a difference but for those to be achieved implementations need to start now.” </li></ul><ul><li>China and India are closely cooperating with I.E.A. countries to increase investments in cleaner and more efficient energy technologies but the efforts need to be stepped up and companies need to be encouraged to buy more expensive technology, the agency said. </li></ul><ul><li>India started to open up to foreign investors with the goal of doubling outsider participation in the country’s oil and gas industry. “If we’re not going to do it at $100 a barrel, we’re not going to do it at all,” said M.S. Srinivasan, secretary of petroleum in India’s Ministry of Petroleum and Natural Gas, in an interview on Monday. </li></ul>
<ul><li>China’s and India’s net oil imports are expected to jump to 19.1 million barrels a day in 2030 from 5.4 million barrels in 2006, more than what the United States and Japan now import. By 2030, global oil demand is expected to reach 116 million barrels a day. </li></ul><ul><li>The use of coal, made attractive by oil and natural gas prices, is expected to rise 73 percent in the next 25 years, mostly because of Chinese and Indian use. The share of natural gas is projected to increase modestly while electricity use doubles. </li></ul>
KEY VARIABLES: MOST POPULOUS/WEALTHIEST NATIONS China & India convert energy into wealth (BTUs per $1.00 of GNP) at only about 25% the efficiency of the USA or European Community
This projection from the U.S. Energy Information Administration shows that China’s energy consumption could nearly double in the next twenty years, and virtually all of this new energy will come from coal. Sources from http://www.ecoworld.com/features/2007/05/19/chinas-energy-demand/
Vid clips <ul><li>http://www.youtube.com/watch?v=5ypezVSZ0uc&feature=related first 3 mins whats happening </li></ul><ul><li>http://www.youtube.com/watch?v=EVmdvRyJW_M energy security- oil </li></ul><ul><li>http://www.youtube.com/watch?v=hU0cP_9GZT4&feature=related wind power </li></ul><ul><li>http://www.youtube.com/watch?v=liFVd-jmm_E&feature=related nuclear </li></ul>
What does this suggest about the future issues and tensions?
Discuss how far economic development can be affected by energy security (10)
<ul><li>China is energy insecure. Discuss (15) </li></ul>
CHINA IS ENERGY INSECURE. DISCUSS! THE EVIDENCE China is a net importer of oil (since 1993)and imports are rising China has invested money in oil and gas companies in over 30 countries globally The money the Chinese have invested in oil equates to 30 million tonnes, but only 10% is sent to China China supplies (through money) much of the world’s oil- it is helping global energy security. China is playing a dangerous game- funding oil- what if the oil industry busts again- lost money By 2020 its predicted China will have the world’s greatest installed nuclear energy capacity China has built a petroleum reserve to store petrol (good if oil increases in price) Chinese government owns their energy companies (limited competition on international stage) Although government owns Chinese energy companies, China allows foreign companies in to build refineries to compete internationally China leads the world in producing clean energy China has a clear energy strategy China has implemented energy saving strategies China is the world’s leading investor in green (renewable) energies ($54 billion dollars invested in 2010. Up 40% from previous year China is the world’s largest producer of co2. It and the USA together = 40% of GHG emissions China is tightening up naval presence China aims to produce 20% of its energy from non fossil fuel sources by 2020- (only 3% output for wind, solar and biomass combined) China is the world’s biggest investor and manufacturer of clean energies like wind turbines (still does not = energy production) China is increasing its solar, wind and HEP installed capacity (ability to produce) but it’s not all working (most not connected to energy grid) China doesn’t see coal as dirty , it produces and consumes most in world- it alone provides 70% of China’s energy needs! China is increasing coal production capacity by 1.1 billion tonnes by 2020, but it’s investing in clean coal- especially carbon capture and storage China is investing in a range of energy sources- wind, solar, oil, gas, cleaner coal and HEP China is the world’s fastest growing economy- demand is rapidly increasing- supply potential is too- but not at same rate Much of western China is not connected to the energy grid China has low energy dependency (total imports as % of consumption) only 12% (the USA 40% and Japan 80%) Per person China’s energy demand is small as many have no access to it, it consumes a 1/3 less oil than the USA and uses only slightly more than Japan (China has 10x the population of Japan!) 8.5 million people in China move from rural to urban areas a year- people in cities consume more energy- increasing consumption China’s people per car ratio is expected to increase from 100 per 1000 in 2002 to 267 per 1000 in 2030. 1000 new cars are added to Chinese roads everyday- they now have more cars there than in the USA. China is building 3 new coal fired power stations a week at present- coal is cheap but dirtier than other sources of energy HEP accounts for 16% of China’s energy- the 3 gorges dam (world’s largest HEP project) alone will generate 25 GW of electricity- = to a 1/3 of UKs total output China has reached peak oil, it has reserves but in awkward locations (far inland in mountains) so investment limited. Also has reserves in South China Sea but is in dispute over them with neighbouring Philippines China has the world’s largest coal reserves but it’s in the north and west- it is needed in the urban south and east- moving it is expensive and dirty. Most of China’s oil imports have to be moved through the straits of Malacca a pirate area between Indonesia and Malaysia- sometimes ships cannot pass risking the Chinese supply China and Turkmenistan recently opened a new gas supply line- that will bring gas into Hong Kong and China’s other major cities- the pipe also crosses Kazakhstan and Uzbekistan- supply issues? It will provide 40 million cu metres of gas more than half its current consumption by 2013 China is looking to cut reliance on coal- to improve its energy mix and cut emissions China is investing in Sudan, Pakistan, Burma, Australia and Canada and their energy production Kazakhstan recently became the world’s biggest uranium producer- China has signed a contract with that nation to exploit their uranium and store nuclear waste in Kazakhstan. China will build 13 new nuclear reactors by 2025