World Energy Outlook 2022

World Energy Outlook 2022

Subject: Economy

Context:

Energy demand in India is expected to be the highest globally, during the current decade aided by rapid urbanisation and industrialisation according to the World Energy Outlook 2022 report of the International Energy Agency (IEA).

Details:

• India’s energy demand would increase by more than 3 per cent per year in the Stated Policies Scenario (STEPS) from 2021 to 2030.
• Energy role:
  • Coal demand in the STEPS rises by 25 per cent to 2030 rising above 770 million tonnes of coal equivalent (Mtce) by 2030
    • In both the STEPS and Announced Pledges Scenario (APS), coal generation is projected to continue to rise in absolute terms, though its share of electricity generation declines.
    • India became the world’s second‐largest coal producer in 2021 (in energy terms), overtaking Australia and Indonesia,
  • Oil demand meets a further quarter of the energy demand growth and rises to nearly 7 million barrels per day by 2030.
  • Renewables meet 30 percent of demand growth to 2030, notably through a rapid increase in solar PV deployment.

Concept:

IEA Reports:

• The International Energy Agency (IEA) medium to long-term outlooks – the World Energy Outlook (WEO) and the Energy Technology Perspective (ETP) – use a scenario approach to examine future energy trends relying on the Global Energy and Climate (GEC) Model.
• The GEC Model is used to explore various scenarios, about how the energy system might respond to the current global energy crisis and evolve thereafter.
  • Various scenarios seek to enable readers to compare different possible versions of the future and the levers and actions that produce them, with the aim of stimulating insights about the future of global energy.
• The WEO-2022 and ETP-2023 – based on the integrated GEC modelling cycle – explore three scenarios:
  • The Net Zero Emissions by 2050 Scenario (NZE) is normative.
    • It shows what is needed across the main sectors by various actors, and by when, for the world to achieve net zero energy related and industrial process CO2 emissions by 2050 while meeting other energy-related sustainable development goals such as universal energy access.
  • The Announced Pledges Scenario (APS), and the Stated Policies Scenario (STEPS) are exploratory, in that they define a set of starting conditions, such as policies and targets, and then see where they lead.
    • The Announced Pledges Scenario assumes that all climate commitments made by governments around the world, including Nationally Determined Contributions (NDCs) and longer-term net zero targets, as well as targets for access to electricity and clean cooking, will be met in full and on time.
    • Stated Policies Scenario (STEPS) reflects current policy settings based on a sector-by-sector and country by country assessment of the specific policies that are in place, as well as those that have been announced by governments around the world.

International Energy Agency

• The International Energy Agency is an autonomous Intergovernmental Organisation established in 1974 in Paris, France.
• MISSION – To ensure reliable, affordable and clean energy for its member countries and beyond. Its mission is guided by four main areas of focus: energy security, economic development, environmental awareness and engagement worldwide
• India became an Associate member of IEA in March 2017 but it was in engagement with IEA long before its association with the organization.
• The World Energy Outlook Report is released by the IEA annually.
• IEA Clean Coal Centre is dedicated to providing independent information and analysis on how coal can become a cleaner source of energy, compatible with the UN Sustainable Development Goals.
• Established in the wake of the 1973-1974 oil crisis, to help its members respond to major oil supply disruptions, a role it continues to fulfil today.
  • IEA’s mandate has expanded over time to include tracking and analyzing global key energy trends, promoting sound energy policy, and fostering multinational energy technology cooperation.
• It has 30 members at present. The IEA family also includes eight association countries.
  •  A candidate country must be a member country of the OECD. But all OECD members are not IEA members.
  • To become member a candidate country must demonstrate that it has:
    • Crude oil and/or product reserves equivalent to 90 days of the previous year’s net imports, to which the government has immediate access (even if it does not own them directly) and could be used to address disruptions to global oil supply.
    • A demand restraint programme to reduce national oil consumption by up to 10%.
    • Legislation and organisation to operate the Co-ordinated Emergency Response Measures (CERM) on a national basis.
    • Legislation and measures to ensure that all oil companies under its jurisdiction report information upon request.
    • Measures in place to ensure the capability of contributing its share of an IEA collective action.
• Reports:
  • Global Energy & CO2 Status Report.
  • World Energy Outlook.
  • World Energy Statistics.
  • World Energy Balances.
  • Energy Technology Perspectives.