12 November 2014: The International Energy Agency (IEA) has released its annual World Energy Outlook (WEO), which finds that, without a transformative shift in the global energy system, the world is set for warming well beyond 2°C. The report states that, even when the new carbon-constraining policies announced by governments are taken into account, emissions will rise 20% by 2040, putting the world on track for a 3.6°C increase in global average temperatures over the long-term.

According to the WEO-2014 central scenario, renewable energies will account for almost half the increase in total electricity generation by 2040, replacing coal as the leading source of electricity. Under the scenario, wind power will account for 34% of the renewable electricity generation growth, followed by hydropower at 30% and solar technologies at 18%. Over the same time period, use of biofuels is expected to reach 4.6 million barrels per day, and the world is predicted to more than double the use of renewable energy sources for heat.

In examining energy efficiency, the report notes that the expected 37% increase in energy demand by 2040 would have been higher and more energy-intensive if not for efficiency measures. It finds that more than 75% of global car sales are subject to efficiency requirements, meaning that, while the number of cars and trucks on the road is expected to double by 2040, the growth in oil transport demand will only be 25%.

In looking at conventional energy supplies, the Outlook questions the longevity of the currently well-supplied oil market, warning that growing dependence on just a few suppliers, Middle East turmoil, conflict in Ukraine and the difficulty of replicating unconventional oil production outside North America threaten to tighten supply.

For the first time in four years, according to the report, fossil fuel subsidies have decreased globally. However, at US$550 billion, they are still over four times higher than subsidies provided to renewable energy. While many fossil fuel subsidies are intended to increase energy access, they often fall short of fulfilling this purpose, according to the report.

Launching the report on 12 November 2014, IEA Executive Director Maria van der Hoeven and Chief Economist Fatih Birol stressed that countries must give clear direction at the Paris climate change negotiations in 2015 in order to spur an increase in low-carbon investment four-times the current level. Otherwise, as indicated in the central scenario, the entire global carbon dioxide (CO2) budget for 2100 needed to keep warming under 2°C is used up by 2040. [IEA Press Release] [IEA WEO Publication Webpage] [Publication: World Energy Outlook 2014 Executive Summary] [WEO-2014 Factsheet] [UNFCCC Press Release] [IISD Global Subsidies Initiative Infographic] [WEO-2014 Launch Presentation]