Energy giant BP has once again revised down its forecast for greenhouse gas emissions growth from global energy use, acknowledging the gathering strength of the low-carbon energy transition and advances in energy efficiency around the world.
But the influential projections fall a long way short of the decarbonisation path scientist’s believe is required to meet the goals set out in the Paris Agreement.
In its latest Energy Outlook, BP predicts emissions from energy use will grow at less than a third of the rate seen over the last 20 years, rising 0.6 per cent a year through 2035 compared to an average of 2.1 per cent a year over the past two decades.
The update represents a significant downgrade of emissions growth projections compared to last year’s Outlook, when BP predicted emissions would grow at 0.9 per cent a year through to 2035.
In fact, BP has steadily downgraded its growth forecasts for emissions each year since 2011, cutting the figure from 1.2 per cent per annum to 0.6 per cent today. If the company’s projections prove accurate, the global economy will deliver over the next two decades the slowest sustained rate of emissions growth from energy since BP’s records began in 1965.
However, BP warns that even with its revised forecasts emissions would still grow by 13 per cent through to 2035, putting the world far off track to meet its climate goals under the Paris Agreement. To meet the Paris obligations, emissions need to fall by around 30 per cent by 2035, BP suggests. “This indicates the need for further policy action,” it notes.
Meanwhile, the report predicts electric cars are set to increase 100-fold over the next 20 years, from one million on the roads today to 100 million in 2035 – a sizeable increase on its 2016 projections of 70 million cars by 2035.
The expanded market will curb global oil demand by around one million barrels a day, according to BP’s chief economist Spencer Dale. But he insisted it would not lead to a peak in global oil demand. “We do expect electric vehicles to keep growing rapidly, but in our base case at least the implications of that for oil demand are not a game-changer,” he said in a presentation released alongside the launch.
Indeed, BP predicts global oil demand will still be growing until 2040, largely due to the increase in middle class consumers in emerging economies buying their first cars. Dale’s prediction echoes that made by the International Energy Agency, but differs from others in the industry who suspect a peak in oil demand could come much sooner. It is gas that receives the most bullish predictions from BP, which forecasts the sector to grow faster than oil or coal over the next 20 years.
However, the energy giant also acknowledges the growing importance of the clean energy revolution in reshaping global energy demand. Renewables are set to be the fastest growing fuel source, it says, with an average growth rate of 7.6 per cent a year to 2035 driven by falling costs in solar and wind and continued clean energy expansion in China.