World Energy Council report confirms global abundance of energy resources and exposes myth of peak oil

World Energy Congress, Daegu, Korea, 15 October 2013: There is a greater abundance of energy resources in the world today than at any other time, and, if properly managed, the reserves are sufficient to meet even a significant upturn in demand for decades to come, according to “World Energy Resources 2013”, a report released today by the World Energy Council (WEC) at its triennial event, the World Energy Congress, in Daegu, Korea.

The report says that the increased assessment of reserves, along with improved energy production and conversion technologies, has enabled the energy industry to meet a growth in demand that is higher than was anticipated two decades ago.

Fossil fuels are still the dominant resource, providing 80% of energy, while new renewables (solar, wind, geothermal, marine) provide about 1.5% only. For electricity production, fossil fuels supply 66% (up by 2%), while new renewables supply around 5%. Over the last 10 years the share of coal has increased to around 28% (up by 4.5%), oil has decreased to 31% (down by 6%), while gas has increased to 23% (up by 2%).

The report also notes that the development of renewables has been significantly slower than was expected 20 years ago.

Christoph Frei, Secretary General of the World Energy Council, commented: “Our latest World Energy Resources report shows that ‘peak oil’ – that the world was running out of oil – has moved into a far future. It is clear that coal, oil and gas are going to keep powering the economies of many countries for many years to come.”

According to the report, although renewable resources, especially wind power and solar PV, have developed exponentially, this started from a low base. Today renewables still represent a small fraction of total global energy supply.

Christoph Frei said: “Renewables will play an important role in our future energy mix. In particular, our World Energy Scenarios study sees that solar PV will have a bright future. However, a number of challenges for renewables remain. There is huge unexploited hydropower potential especially in Africa, Asia and Latin America, but a number of large projects are facing local resistance. There is significant potential of biomass energy, particularly in Latin America, but concerns about the energy-water-food nexus have to be carefully managed. Other technologies, such as marine energy, still require a lot of efforts in RD&D.”

Alessandro Clerici, Executive Chair of World Energy Resources, commented: “The growth of new renewables, namely wind and solar, has been mainly dependent on generous government support and subsidies especially in the EU. In addition, integrating a high percentage of intermittent renewables into the grid has remained challenging due to the high cost of storage and backup power. Intermittent renewables such as wind and solar will have an increased share in future electricity generation but they will still remain marginal in the global primary energy supply for decades to come.”

The report also finds that the increase of renewables has not been enough to make up for the drop in nuclear energy, from a peak of 17% in the late 1980s to 13.5% in 2012. Nuclear energy faces an uncertain future, with the nuclear renaissance stalled following the Fukushima accident, the report adds.

Alessandro Clerici commented: “The growth of renewables will benefit from having conventional thermal plants with the right flexibility for power-frequency regulation and finding adequate storage and grid technologies. Meanwhile, energy efficiency presents an immediate opportunity to reduce both energy intensity and emissions. However, as energy-efficient systems are capital-intensive, decision-makers must abandon the usual short-term mentality to finance projects based on initial costs, to also account for the lower lifecycle costs.”

The report concludes by noting that while the resources and technologies are available to meet rising demand, there are other constraints on the sector, most notably financing, the environment and climate.

Significant findings of the report are:

Oil

  • Global crude oil reserves today are almost 25% larger than in 1993 and production has gone up by 20%.
  • The oil reserves in the world could be quadrupled if unconventional resources such as oil shale, oil sands, extra heavy oil, and natural bitumen are taken into account.
  • The report sets out a global oil reserves-to-production (R/P) ratio of 56 years with total available reserves estimated at 223 billion tonnes.

Coal

  • Coal is still the global primary energy source (40%) for electricity production. Leading economies are still powered by coal, with 79% of electricity in China and 40% in the USA generated by coal-fired plants, respectively.
  • The report sets out a global coal reserves-to-production ratio in excess of 100 years with total available reserves estimated at 891 billion tonnes.

Natural gas

  • Natural gas is expected to continue to grow, thanks to significant increases in the reassessment of reserves and the growing contribution of unconventional gas, such as shale gas.
  • The report sets out a global reserves-to-production ratio for natural gas at 55 years with total reserves estimated at 209 trillion cubic metres.

Nuclear

  • The survey sets out that total identified uranium resources have grown by 12.5% since 2008 and are sufficient for over 100 years of supply based on current requirements.
  • Nuclear power generated 2385 TWh in 2011.
  • The nuclear share of total global electricity production reached its peak of 17% in the late 1980s, but since then it has been falling and reached 13.5% in 2012.

Hydropower

  • Hydropower generated 2767 TWh in 2011.
  • During 2012, an estimated 27 to 30 GW of new hydropower and 2 to 3 GW of pumped storage capacity was commissioned.
  • Since the WEC’s 2010 resources survey the total amount of electricity produced by hydropower has dropped by 14%, in part due to water shortages.

Wind

  • Wind generated 377 TWh in 2011 from 240,000 MW of installed capacity.
  • Total amount of electricity generated by wind in 2011 was roughly equal to Australia’s annual electricity consumption.
  • China, with about 62 GW, has the world’s highest installed capacity of wind energy, while Denmark, with over 3 GW, has the highest level per capita.

Solar PV

  • The global total of installed capacity for solar PV stood at 68,850 MW in 2011 with an energy production around 70 TWh.
  • Between 2008 and 2011 solar PV capacity increased in the USA from 1168 to 5171 MW, in Germany from 5877 to 25,039 MW, and in Italy from 430 MW to 13,000 MW.

Bioenergy

  • Between 1990 and 2010 bioenergy supply increased from 38 to 52 EJ.

The report showcases the potential for energy efficiency to decrease the use of resources and achieve huge savings along the entire energy value chain. Examples include:

  • Buildings account for almost 40% of global consumption and the report notes potential energy savings in buildings could reach between 20 and 40%.
  • In oil & gas exploration the energy efficiency of the electric system, which today is 20%, could be increased up to 50%.
  • In power generation the average efficiency of power plants is 34% for coal-fired installations compared with best available technology of 46% for coal and 61% for gas-fired units.

The report is the 23rd of the World Energy Council’s resources studies, with the full report running to nearly 600 pages. The first report was published in 1933 and was entitled Statistical Year Book of World Energy, which later became the WEC Survey of Energy Resources. The series is regarded worldwide as the premier source of information on global energy resources and is made available free of charge via the World Energy Council’s website: www.worldenergy.org/publications.

The World Energy Council also announces that Hans-Wilhelm Schiffer, from Germany’s RWE AG, will succeed Alessandro Clerici, Senior Advisor of CESI Italy, as Executive Chair of the World Energy Resources study, to take effect after the World Energy Congress.