World Energy Consumption Facts, Figures, and Shockers

In the first installment of this series, I reviewed U.S. and global oil reserves according to the 2012 BP Statistical Review of World Energy. The second installment covered oil production. Today, I want to examine the changes in consumption of coal, oil, and natural gas since 1965 in the three major consuming regions of the world: Asia Pacific, the United States, and European Union countries.

Highlights of this article and topics that will be explored include:

• Explosive consumption growth in all categories from Asia Pacific
• Why the arguments of climate change advocates are misplaced
• Recent declines in coal and oil consumption in the U.S. and EU
• Why natural gas consumption is increasing in the U.S.

 

How Much Energy Does the World Consume?

I have often said that I view the growth of carbon emissions as an unstoppable hurricane, for reasons I will reiterate in the next article. Further, I believe one of the reasons that climate change advocates are so ineffective is that they are constantly aiming at the wrong target. The first figure of regional coal consumption emphasizes that point.

Statements and press releases from organizations involved in climate change advocacy leave the strong impression that the biggest obstacle in the war on climate change is Big Oil. In fact, this is where advocates spend the vast majority of their time; fighting against oil consumption. The battle over the Keystone Pipeline is a case in point. But compared to the explosive growth of coal consumption in the Asia Pacific region, potential emissions as a result of the Keystone Pipeline are trivial.

Since 1965, consumption of coal in the U.S. and in European Union countries (the European Union did not exist in 1965, but I will refer to these countries here as the “EU”) has changed at a relatively slow pace. Over the past 46 years, coal consumption in the U.S. has grown by 72%, but it has fallen by 44% in the EU. In recent years, coal consumption has declined in the U.S. as well — down 13% since 2005.

It’s All About Asia Pacific

The Asia Pacific region — dominated by consumption in China and India — is an entirely different story. Coal consumption in the region has increased by more than an order of magnitude since 1965, and is currently more than triple the coal consumption of the EU and U.S. combined. This represents enormous growth in global carbon emissions, which will be the topic of the next post.

The next figure shows that oil consumption trends for Asia Pacific are similar; the region has experienced rapid growth since 1965. The past 46 years has seen oil consumption grow by 63% in the U.S., 60% in the EU, and 777% in Asia Pacific. Oil consumption in the U.S. and the EU has been trending downward since about 2005. But the reason there has been little relief from high oil prices — despite the drop in demand in the West — is that global oil consumption continues to climb on the back of very strong Asian demand.

Natural gas consumption trends tell a somewhat different story. While the trend for Asia Pacific is the same — 2011 is more than 100 times the region’s 1965 consumption — the next figure shows that natural gas consumption in the U.S. is also on the rise.

The rise in natural gas consumption in the U.S. is a result of utilities switching from coal to natural gas as a cleaner and more economical option for producing electricity. The trend has been driven by very low natural gas prices and the threat of more restrictive regulations on coal-fired power. The switch is happening remarkably fast; in 2008 natural gas was used to produce 20% of America’s electricity, but this year the natural gas share will reach 30%.

Strong consumption growth trends are certainly not limited to Asia Pacific. All developing regions of the world have shown strong demand growth as well, but the demand in these other regions is far below that of Asia Pacific. However, total crude oil demand from the Middle East, South America, and Africa reached over 17 million bpd in 2011 — a 5 million bpd increase over the previous 10 years and a total on par with U.S. crude oil consumption.

But explosive growth in developing countries is the real story as far as carbon emissions go, and the topic of the next article.

R Squared