Bloomberg reports on the latest warnings from the International Energy Agency’s (IEA) in its annual World Energy Outlook report.  The IEA says that energy will become “viciously more expensive” and polluting if governments don’t promote renewable and nuclear power in the next two decades instead of burning coal.

The agency predicts that global demand for energy could  increase 40 % by 2035. Consumption will rise 1.3 % a year to 16.96 billion metric tons of oil equivalent in 2035, driven by China and other emerging economies.

In light of the Fukushima disaster, some European countries are planning on shutting down their nuclear plants while other countries are reviewing their nuclear plans going forward.  This raises a serious concern for the IEA about future electricity prices.

Fatih Birol, the IEA’s chief economist in Paris, said in an interview yesterday that a shift away from nuclear power “would definitely be bad news for energy security, for climate change and also for the economics of the electricity price.”

Investment in energy infrastructure of $1.5 trillion a year is needed to meet projected demand through 2035, and even then, “the cost of energy will increase,” Birol said.

With nuclear producing less electricity, the IEA expects there will be a return to coal-fired generating plants and thus an increase in the demand for coal and C02 emissions.  Global coal demand will increase to 4.1 billion tons of oil equivalent from 3.29 billion tons in 2009, or a 24 % rise over the forecast period, under the IEA’s base case scenario.

The demand for natural gas for heat and to produce electricity will also increase. Natural gas is the only fossil fuel for which demand rises under all three of the IEA’s scenarios, increasing its demand forecast by as much as 5.1 trillion cubic meters a year by 2035 from about 3.1 trillion in 2009.

Renewable energies, excluding hydro power, are expected to account for 15 % of electrical power generation in 2035 from 3 % in 2009, the IEA said. The use of renewables will be backed by a five-fold increase in subsidies to $180 billion, driven largely by China and the European Union.

The US, the world’s largest crude oil consumer, is expected to see its demand for this product decline through 2035 as the country raises vehicle efficiency and boosts domestic production of shale gas. Demand is forecast to drop to 14.5 million barrels of oil a day in 2035 from 18 million last year, the agency said.

“Oil imports in the United States will decline significantly,” Birol said. “The U.S. will be less and less vulnerable to oil price shocks in the future.”

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1 Comment on IEA: Energy Costs to Rise ‘Viciously’ Without Nuclear

  1. James Aach says:

    I think we’ll better decisions about our energy future if we first understand our energy present. Producing electricity on a large scale is a very tricky business and I’m afraid the media and most of their “experts” have little real understanding how it is done. I’ve worked in the US nuclear industry over twenty years, and the reality of it is far different that what I see portrayed by opponents and advocates alike. (There’s plenty of both good and bad.) Rather than just complain, I wrote “Rad Decision”, a techno-thriller novel that gives an inside view of atomic fun without putting the reader asleep. It is available free online (with no adverts amd no sponsors). Just Google the title. As a bonus, it turns out the climatic event depicted in Rad Decision is a lot like Fukushima, oddly (and sadly) enough.