BP Energy Outlook 2023

By Paul Homewood

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h/t Robin Guenier

A couple of days ago BP’s Spencer Dale warned that the world would still be needing fossil fuels for 20% of its energy, according to their latest Energy Outlook. But it turns out that even this is grossly over-optimistic:

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https://www.bp.com/en/global/corporate/energy-economics/energy-outlook.html

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Let’s take a closer look at the report.

The first thing to note is that all of the projections are based on three scenarios:

• New Momentum
• Accelerated
• Net Zero

Net Zero produces the biggest emission cuts, and this is what Spencer Dale’s 20% figure was based on, New Momentum gives the least emission cuts. but as the name suggests it still assumes emissions are much less than Business As Usual (based on existing national pledges), which curiously is missing from the report.

The clue to this omission possibly lies in the first of the Core Beliefs:

There is of course no “Carbon Budget”, and the rest of the world would certainly not recognise it had any relevance to them anyway. The fact that BP even mention it shows that this is not an objective, realistic analysis, but instead is a politically motivated attempt to put some clothes on the naked emperor!

But I digress!

The first chart shows how utterly unrealistic the Net Zero scenario is. Nobody seriously believes the whole world will have to all intents and purposes eliminated CO2 emissions by 2050. And the Accelerated one is barely more credible::

 

One reason why those two scenarios belong in the waste bin is that they both assume that energy consumption will fall drastically after 2030. This is just silly, and it reflects poorly on BP that they should have put their name to this rubbish. (I do accept by the way that they are right to project what a Net Zero strategy would look like, but they should have emphasised its sheer impracticability, instead of passing it off as a plausible outcome).

 

The whole idea that China, India and the rest of the developing world is going to give up the extra energy their economies need to grow is absurd, even if energy efficiencies are built in. What we need to remember is that the developed world has made immense strides over the decades in energy efficiency, but overall consumption still rose as people became richer and consumed more.

We then come to oil and gas. BP don’t seem to have tried to estimate consumption by regions, but they have looked at import trends, These show that gas and oil imports fall away sharply in the EU, primarily because of the war in Ukraine. But in China and India, their use remains pretty much where it is today even by 2050. (BP’s logic for using imports as an indicator is that countries won’t want to rely too much on imports for energy security reasons; as there is limited reserves of oil and gas domestically, so the logic goes, they will be forced to rely on renewables instead):

And the upshot of all of this?

Under the only rationall projection, New Momentum, fossil fuels will still be supplying 55% of the world’s energy in 2050, with renewables well down the list at 35%.