Dr. Fatih Birol Chief Economist for the International Energy Agency 13 March 2012 Sustainable Energy for All (#SE4A) Conference Venice

1. Energy for all will not cost the earth
Dr Fatih BIROL
IEA Chief Economist
13 March 2012
© OECD/IEA 2011

2. The context: fresh challenges
add to already worrying trends
 Economic concerns have diverted attention from energy policy
and limited the means of intervention
 Post-Fukushima, nuclear is facing uncertainty
 MENA turmoil raised questions about region’s investment plans
 Some key trends are pointing in worrying directions:
 CO2 emissions rebounded to a record high
 energy efficiency of global economy worsened for 2nd straight year
 spending on oil imports is near record highs
© OECD/IEA 2011

3. Emerging economies continue
to drive global energy demand
Growth in primary energy demand
4 500
Mtoe
4 000 China
3 500 India
3 000 Other developing Asia
2 500 Russia
Middle East
2 000
Rest of world
1 500
OECD
1 000
500
0
2010 2015 2020 2025 2030 2035
Global energy demand increases by one-third from 2010 to 2035,
with China & India accounting for 50% of the growth
© OECD/IEA 2011

4. Energy poverty is widespread
Million people without electricity
Million people without clean cooking facilities
Sub-Saharan Africa China
8 423
Rest of
Latin America 585 653 developing
India
Asia
31
85 289 379
836
661
1.3 billion people in the world live without electricity
and 2.7 billion live without clean cooking facilities
© OECD/IEA 2011

5. Investment today is far from enough
$9.1 billion was invested in energy access in 2009
14%
22% Bilateral Official Development Assistance
Multilateral organisations
Developing country governments
34%
Private sector finance
31%
Current investment relies heavily on overseas development aid
© OECD/IEA 2011

6. Giving modern energy to the world
will not cost the earth
5.3 x more
2009
Energy for All Case
Other Countries Sub- Saharan Africa
2010-2030
0 10 20 30 40 50
Billion dollars (2010)
Investment needs to grow by more than five-times to $48 billion a year
– half of which in sub-Saharan Africa
© OECD/IEA 2011

7. All sources of finance need to grow
50
Billion dollars (2010)
Private finance
40 Developing country governments
Multilateral development banks
30
Bilateral official development assistance
20
10
0
2009 Energy for All Case
Private sector investment needs to grow the most,
but public authorities must provide a supportive investment climate
© OECD/IEA 2011

8. All fuels have a role to play
Additional electricity generation by grid solution and fuel in 2030
On-grid generation Mini-grid and off-grid generation
368 TWh 370 TWh
10% 7%
5% Fossil fuels Solar
6% Nuclear 36%
28% Small hydro
Hydro Biomass
14%
63% Wind Wind
3% Solar Diesel
Other renewables 8%
21%
A range of technical solutions using different sources of energy is required
© OECD/IEA 2011

9. Implications of modern energy for all
20 40 Additional energy demand in the
Gigatonnes
Billion tonnes of oil equivalent
0.7%
1.1% Energy for All Case
15 30 Additional CO2 emissions in the
Energy for All Case
10 20
5 10
0 0
World energy World CO2
demand emissions
2030 2030
Achieving modern energy for all would only have a negligible impact on
energy security and climate change
© OECD/IEA 2011

10. Modern energy brings health benefits
Premature annual deaths from household air pollution and selected diseases
2.5
Million
2.0
1.5
1.0
0.5
0
2008 2030 2008 2030 2008 2030 2008 2030
Malaria Tuberculosis Smoke from HIV/AIDS
biomass
Clean cooking facilities would prevent the majority of deaths attributable
to indoor air pollution from burning biomass
© OECD/IEA 2011

11. Concluding remarks
 In a world full of uncertainty, one thing is sure: rising incomes &
population will push energy needs higher
 Modern energy is critical to social and economic development goals
 Affordable and reliable modern energy for all by 2030 is achievable
 Adopt a clear statement that modern energy access is a political priority
 Mobilise additional public and private investment in universal access
 National governments need to adopt strong governance and regulatory
frameworks and invest in internal capacity building
 The public sector should leverage greater private sector investment where the
commercial case is marginal
 World Energy Outlook has highlighted energy access for a decade and
will continue to do so in WEO-2012
© OECD/IEA 2011