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Energy Policy Scenarios to 2050

4.2. Scenario 2: Elephant

4.2.1. Global Story

Gross Domestic Product
This scenario produces more positive economic results, in general, than the Leopard scenario, but Latin America sees government efforts as insufficient, while Africa goes further and sees government interventions distorting the markets in the 2035-2050 timeframe with deleterious effects on Africa's economies. North America is more optimistic and sees growth increasing by the 2035-2050 timeframe, largely driven by the United States, with Canada and Mexico being more pessimistic. In Latin America, this scenario represents the situation existing in most of Latin America until the early 1990s when democratically elected governments began to flourish.

Population
Most see population growth as stable, with Asia continuing to show rates increasing slightly and Latin America seeing demographic growth decreasing as per recent trends. The combination of low economic growth and insufficient government actions leading to less emphasis on controlling birth rates means that the growth rate remains stable. The population growth rate in Africa declines in the period between 2035 and 2050 as poverty persists, birth rates actually decrease with the emancipation of women, and economies decline.

Energy Intensity
Intensity decreases in Asia, Europe, and North America as new technologies are introduced and governments push strongly for improvements in energy efficiency. Africa sees the benefits of these actions earlier, but then cannot sustain its gains due to its lack of access to new technology because of low international cooperation. In Latin America, an increase in the ratio of thermal power generation versus more efficient hydropower generation and an increase in agricultural and industrial exports to compensate for dependence on foreign high technology goods also delays improvements and increases energy intensity.

The model indicates energy intensities in this scenario decreasing 20% by 2020, about 30 % by 2035, and nearly 35% by 2050, compared with today (see Figure 4-1 ).

Energy Mix
The diversification of the energy mix improves generally, except in North America where it is already diverse and stays that way. In Latin America, expansions are seen in natural gas, biofuels, wind, and solar heating early in the period and later toward 2050 with the substitution of nuclear power and coal for hydropower. Governments diversify the energy supply for security reasons. The same situation is generally seen for Africa, except that, at the end of the period, the expansion of the mix stagnates due to limitations in financial resources and limitations on technology transfer because of the lack of international cooperation. Asia sees an increase in the mix because of government mandates shifting away from fossil energy.

TPER
The rate of growth in the TPER increases early in the period and then stabilises and even decreases later, due primarily to government pressure and improvements in energy efficiency. In Latin America, this trend is exacerbated by a falling GDP growth rate.

In the model, primary energy (modern) production in this scenario increases by about 30% by 2020, between 50-60% by 2035, and around 80% by 2050, reflecting the perceived influence of governments introducing policies that reduce energy consumption, primarily through improvements in energy efficiency (see Figure 4-2 ).

Greenhouse Gases
Due directly to government engagement in this scenario, North America and Europe see a reduction in the growth of greenhouse gas emissions compared with the Leopard scenario. In contrast, Africa and Latin America do not believe governments by themselves have the power to curb emissions. Limited international cooperation is a major impediment to accomplishing meaningful emissions reductions. In Asia, emissions increase until late in the period when any realistic application of high efficiency technologies has an impact.

The model for this scenario leads to lower future CO2 emissions than the Leopard scenario: around a 25% increase by 2020, just over a 40% increase by 2035, and staying level until 2050 (see Figure 4-3 ).

Supply-Demand Tension
Oil. In general, tension around oil decreases in comparison with the Leopard scenario; however, Africa does not see governments being strong enough to affect the situation and sees tension increasing the same as in the Leopard scenario. Perhaps the biggest change from Leopard is in North America, where governments have an impact on creating alternative fuels (e.g., biofuels, oil from sands).

Gas.
Gas tension is for the most part seen as the same as the Leopard scenario. Demand increases, but new exploration meets increasing demand to some extent. Much is unknown about the future of this energy source. Gas is assumed to maintain its position in all regions.

Coal.
With government engagement, coal loses some of its importance in Europe. Other regions show little or no change, with coal continuing to be exploited as an abundant and relatively inexpensive energy source.

Nuclear Power.
The active engagement of governments in this scenario increases the supply of nuclear power, and therefore tension, as demand may outstrip industry's ability to provide the necessary manufacturing infrastructure. This increase in tension is a clear and recurring signal that everyone sees strong government engagement as absolutely essential if nuclear power is to play a significant role in the global energy mix. Africa is the exception, and sees strong international cooperation (technology and financing) as essential for the development of nuclear power on the continent. Thus, for Africa to benefit, a combination of government engagement in other regions is required together with regional cooperation and integration in Africa.

Renewable Energies.
With government engagement and encouragement, everyone sees renewable energy demand increasing, along with tension due to inability to keep up with demand, and as a response to public concerns about the effects of climate change.

Non-commercial Energy.
Little change is seen from the Leopard scenario. Africa sees population growth increasing the tension here and as before, this is not an issue now in North America or Western Europe and not seen as one in the future. This may be an issue in Asia, and somewhat less in Latin America, with negative effects relating to deforestation.

4.2.2. Winners, Losers, and Dilemmas

Because of the stronger role of government in this scenario in comparison with the Leopard scenario, people who need access to energy and energy services are likely to benefit. However, because there is no change in international cooperation and integration, international financing and investment in energy products and services is not improved. There is also lower relative energy security as a result of supply regions not cooperating to an optimum extent with demand regions and nations. Energy industries might also suffer due to a lack of uniform regulation across regions and nations.

A dilemma in this scenario may be how Africa and Latin America would reduce carbon emissions, as high government involvement by relatively weak governments could prove to be counterproductive.

4.2.3. Oil Production Limits

For illustration, the model examines the effect of limits on oil production by the Gulf States. Rather than using the 45 million barrels per day in 2035 in the model, 25 million barrels per day were used. In this case, the model shows no change in energy intensity from this scenario. Primary modern energy requirements and thus CO2 emissions are only slightly lower than the results for the Leopard scenario in all time periods.