The International Outlook presents an assessment by the U.S. Energy Information Administration of the outlook for international energy markets through 2050

Executive summary

In the International Energy Outlook 2017 (IEO2017) Reference case, total world energy consumption rises from 575 quadrillion British thermal units (Btu) in 2015 to 736 quadrillion Btu in 2040, an increase of 28%.  Most of the world’s energy growth will occur in countries outside of the Organization for Economic Cooperation and Development (OECD) [1], where strong, long-term economic growth drives increasing demand for energy. Non-OECD Asia (including China and India) alone accounts for more than half of the world’s total increase in energy consumption over the 2015 to 2040 projection period. By 2040, energy use in non-OECD Asia exceeds that of the entire OECD by 41 quadrillion Btu in the IEO2017 Reference case (Figure 1).

Economic growth—as measured by gross domestic product (GDP)—is a key determinant in the growth of energy demand. The world’s GDP (expressed in purchasing power parity terms) rises by 3.0%/year from 2015 to 2040. The fastest rates of growth are projected for the emerging, non-OECD regions, where combined GDP increases by 3.8%/year, driving the fast-paced growth in future energy consumption among those nations. In the OECD regions, GDP grows at a much slower rate of 1.7%/year between 2015 and 2040, at least in part, because of slow or declining population growth in those regions.

World energy markets by fuel type

In the long term, the IEO2017 Reference case projects increased world consumption of marketed energy from all fuel sources—except coal, where demand is essentially flat—through 2040 (Figure 2). Renewables are the world’s fastest-growing energy source, with consumption increasing by an average 2.3%/year between 2015 and 2040. The world’s second fastest-growing source of energy is nuclear power, with consumption increasing by 1.5%/year over that period.

Although consumption of nonfossil fuels is expected to grow faster than fossil fuels, fossil fuels still account for 77% of energy use in 2040. Natural gas is the fastest-growing fossil fuel in the projections. Global natural gas consumption increases by 1.4%/year.  Abundant natural gas resources and rising production—including supplies of tight gas, shale gas, and coalbed methane—contribute to the strong competitive position of natural gas. Liquid fuels—mostly petroleum-based—remain the largest source of world energy consumption. However, the liquids share of world marketed energy consumption falls from 33% in 2015 to 31% in 2040, as oil prices rise steadily, leading many energy users to adopt more energy-efficient technologies and to switch away from liquid fuels when feasible.

Compared with the strong growth in coal use in the 2000s, worldwide coal use remains flat in the IEO2017 Reference case [2].  Coal is increasingly replaced by natural gas, renewables, and nuclear power (in the case of China) for electric power generation, and demand for coal also weakens for industrial processes. China is the world’s largest consumer of coal, but coal use is projected to decline in China by 0.6%/year from 2015 to 2040, and in the combined OECD countries coal also declines by 0.6%/year over that same period. With coal consumption in India and other nations in non-OECD Asia growing over the projection period, worldwide coal consumption is not as low as it would otherwise be in 2040. The coal share of total world energy consumption declines significantly over the projection period, from 27% in 2015 to 22% in 2040.

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Footnotes

¹ For consistency, OECD includes all members of the organization as of June 1, 2016, throughout all the time series included in this report. OECD member countries as of June 1, 2016, are Austria, Australia, Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Luxembourg, Mexico, the Netherlands, New Zealand, Norway, Poland, Portugal, Slovakia, Slovenia, South Korea, Spain, Sweden, Switzerland, Turkey, the United Kingdom, and the United States. For statistical reporting purposes, Israel is included in OECD Europe. Latvia became a member of the OECD on July 1, 2016, and its membership is not yet reflected in the IEO projections.

² The IEO2017 Reference case projections include the impacts of the U.S. Clean Power Plan (CPP) regulations. According to EIA’s analysis, U.S. coal consumption would be 15.2 quadrillion Btu in 2040 without the CPP, relative to the IEO2017 Reference case projection of 10.6 quadrillion Btu.