It is the year 2030. Global energy demand has jumped by 53 per cent. Emissions of greenhouse gases have soared by 55 per cent over today's levels. The earth is heading for meltdown.
That is the catastrophic scenario of continuing with "business as usual" depicted in the International Energy Agency's annual World Economic Outlook. That is, unless policymakers and consumers can be persuaded to alter their behaviour radically.
"On current trends, we are on course for a dirty, expensive and unsustainable energy future," the IEA's executive director Claude Mandil said at the report's launch in London yesterday. "In response, urgent government action is required. The key word is urgent."
The IEA advises industrialised countries on their energy needs. At last year's Gleneagles summit of world leaders, it was given the job of "advising on alternative energy scenarios and strategies aimed at a clean, clever and competitive energy future."
The answer it produced yesterday is stark. The world must embrace nuclear power and consumers have to invest in more energy-efficient equipment and cars, if we are to meet our needs in a sustainable way. And, we have to find $20 trillion to invest in energy infrastructure.
"The world is facing twin energy-related threats: that of not having adequate and secure supplies of energy at affordable prices and that of environmental harm caused by consuming too much of it... the current pattern of energy supply carries the threat of severe and irreversible environmental damage," the report said.
The IEA took two scenarios, the "reference" case of continuing current trends, and the "alternative" model, which sees a sharp reduction in energy demand. Under the business-as-usual case, global oil demand reaches 99 million barrels per day in 2015, and 116 mbd in 2030 - compared with 84 mbd in 2005. By 2030, the OECD group of 26 in-dustrialised countries would import two-thirds of its oil needs, from 56 per cent today. Much of the additional imports would come from the Middle East, "along vulnerable maritime routes".
The price of crude oil, in nominal terms, will reach $97 ($55 in real terms) in 2030, or around $130 if the required investment is delayed, the IEA predicted. More than 70 per cent of the increase in demand for oil and other primary energy sources would come from developing countries, with China alone accounting for 30 per cent. The level of investment required to service our energy needs between now and 2030 is just over $20 trillion, of which the power sector accounts for 56 per cent. More than half of all the energy investment required worldwide is in developing countries. China alone needs $3.7 trillion.
This is going to be very hard to meet. …