Oct. 16 – In its study of the energy outlook for the Asian region, the Asian Development Bank (ADB) created two possible future scenarios: business as usual (BAU) or the more positive “alternative case.”
Specifically, the BAU case “reflects the impact of existing policies and current technology levels on future energy demand and energy choice, as well as assumes that current trends in the development of new and renewable energy sources will continue into the future.”
On the other hand, the alternative case considers the “potential for energy savings on both the demand and the supply sides from the deployment of advanced and low-carbon technologies to increase energy security in the region.”
The ADB further concluded that, from 2010–2035, the BAU will need a total investment of US$11.7 trillion in the energy sector ranging “from upstream energy extraction and production to midstream energy transformation and transportation to downstream energy distribution.”
The alternative case will need US$19.9 trillion in investments for both the supply and the demand sides, which should include the following: “advanced energy-efficient technologies for the transport, residential, commercial, and industry sectors as well as advanced coal- and natural gas-fired power generation technologies for improved thermal efficiency as well as for low-carbon-emitting power generation (nuclear, wind, and photovoltaic).”
The BAU case also predicts that from 2010-2035 Asian energy demand will increase by 2.1 percent annually – slightly faster than the global average rate of 1.5 percent. What this means is that by 2035 demand will equate to 8,358.3 million tons of oil equivalent (Mtoe) – almost double that of the 2010 level of 4,985.2 Mtoe.
During this period, developing countries are expected to see higher energy demand growth rates of about 2.3 percent growth annually whereas developed economies will see a slight reduction in their energy demand of about -.01 percent per year through 2035.
In the more optimistic alternative scenario, the ADB predicts that energy demand may grow by only 1.4 percent annually through 2035. In this scenario, energy demand will top out at 1,295.2 Mtoe lower than in the BAU case.
ADB predicts: “Energy transformation (including power generation and other transformation processes such as oil refining and gas processing) will represent the biggest energy savings potential, estimated to amount to 734.6 Mtoe in 2035.”
The main factors in this energy transformation will be demand-side electricity savings and thermal efficiency improvements, and the industrial sector has the best chance of having an impact with regard to reducing energy demand.
The ADB also attempted to predict the growth in CO2 emissions for the Asia region: for the BAU case, the region is expected to see an increase from 13,404 million tons of CO2 in 2010 to 22,112.6 million tons of CO2 in 2035 (a year-on-year 2 percent growth rate). However, East Asia’s CO2 intensity (CO2 emissions per total primary energy demand) should decrease to 0.3 percent because of its move to less carbon-intensive energy.
In the alternative case CO2 will be 27.6 percent lower than the BAU case due to its greater reliance on energy efficiency and the use of less-carbon emitting energy sources.
In 2010, CO2 emissions from the region accounted for 42.8 percent of world CO2 emissions; by 2035, it is expected to account for more than half.
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