Report: In 20 Years, Energy Demand Will Outpace Supply

Last week, the world population reached 7 billion. Almost concurrently, NRG Expert released new forecasts which show that, given the current rate of population growth, global electricity supply is not likely to keep pace with future energy needs.

According to the new study, the energy tipping point is only about 20 years from now. NRG Expert predicts that 2032 will be the pivotal year where global electricity demand is likely to surpass supply based on global generation.

Of course, population growth isn't the only factor that impacts the sustainability of the world's energy supply. As NRG Expert points out, depleted natural resources and the phasing out of nuclear power in developed and developing countries also play a role.

A new report from Capgemini seems to draw a similar conclusion. The 13th edition of the European Energy Markets Observatory (EEMO) found that energy consumption growth in developing countries, the Fukushima accident and the slowing down of the needed investments made by utilities all will have negative consequences on the security of energy supply and greenhouse gas emissions in Europe.

The report shows that in the longer term consumers can expect increased energy prices and even more severe consequences on supplies unless regulators and governments start recognizing the challenges ahead and working towards solutions.

For instance, the Fukushima accident triggered debate on the present and future energy mix. As Capgemini reports, the International Energy Agency forecasts that worldwide gas consumption will increase by 50 percent between 2011 and 2035 and the energy market share of gas will reach rise to 25 percent from 21 percent today (only slightly lower than oil at 27 percent). Capgemini also expects the Fukushima accident to boost the development of renewable energies and benefit the gas industry (due to its lower cost).

"Growing energy consumption combined with global events in 2011 and insufficient investments have created an energy environment in Europe of decreased short- and long-term security of supply, a likely increase in emissions owing to reduced nuclear output and a likely growth of energy prices," Colette Lewiner, Global Leader Energy, Utilities & Chemicals, Capgemini, said. "Although a second economic crisis might delay these negative effects, the longer term impact will be difficult to face as we struggle to curb the planet's temperature rise and keep the lights on' for future generations."

TAGS: Finance
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