EU Energy Policy Blog

In the EU like elsewhere the amount of energy that will be consumed in the future is determined as the product of population, wealth and energy intensity.

The EU’s population is expected to remain more or less stable to 2050, according to Eurostat increasing from 495 million today to 520 million in 2035 and then decreasing to 510 million in 2050. Furthermore, it is reasonable to assume a GDP growth of on average 2% per year to 2050. This then only leaves the energy intensity [MWh/GDP] as a parameter which can be modified. This can be accomplished by improving the energy efficiency.

The figure below plots the energy consumption of the EU today, and a number of different scenarios regarding how much one can reasonably expect that it will need in 2050. Obviously, this is far from simple, but it is possible to plot some reasonable scenarios.

Final energy consumption for EU-27 (Note: including energy resources consumption for energy and non-energy use, BAU: business-as-usual scenario, *data for 2050 are extrapolation of the reduction between '20 and '30).
Source: Study for the new Energy Efficiency Action Plan.

Final energy consumption for EU-27 (Note: including energy resources consumption for energy and non-energy use, data for 2050 are extrapolation of the reduction between ’20 and ’30). Source: Study for the new Energy Efficiency Action Plan.

The first two bars in the graph show historic (1990) and current (2007) energy consumption. The third, fourth and fifth bars predict EU future energy demand in 2020, 2030 and 2050. The fifth bar thus indicates that if the EU only continues the energy efficiency policies already announced, one can expect that in 2050 EU will need about 10% more energy than it uses today (energy efficiency improvements will cancel out most of the growth that would have otherwise resulted from GDP growth during the period).

The final column (2050 high EE) indicates what might be possible in 2050 on the basis of a very (very) aggressive approach to improving energy efficiency over the next 40 years; delivering a 37% reduction in energy demand compared to today. It assumes that existing demand from industry can be reduced by 30%, for households 40%, services, agriculture and other 35%, and finally for transport by 40% compared to 2007, even though GDP is assumed to continue growing.

• In terms of buildings, low energy houses could be constructed at or below the cost of normal ones taking into account projected savings in energy costs over the lifetime of the building. Notice that refurbishing an existing house to very low energy standards is much more difficult than equipping a new building. However, even with existing options a great deal can profitably be done.

• Cogeneration (or combined heat and power – CHP) is a more efficient way to generate heat and electricity compared to separate generation of both. Common district heating is another possible more efficient way for heating vis-à-vis individual heating. District heating could also be CHP.
• In terms of energy using products, such as washing machines, motors, boilers, TVs and computers, considerable savings can be made. Also regarding the energy used in manufacturing the goods that we consume, again, considerable efficiencies can be expected in the coming decades.

• In agriculture, over the past 20 years, overall energy consumption has reduced by around 20%, indicating a further efficiency improvement that might be expected.

• In transport, given the wide spread on fuel consumption of current cars, the potential for energy savings is evident. Furthermore, in the event of a massive shift to electric vehicles as argued later in this article, further efficiency gains are possible.

Thus, by concentrating on all the areas outlined above, it is reasonable to believe that, even with a GDP growth of on average 2% per year to 2050, the EU could significantly reduce the energy that it uses by 2050. With determined action it might even reduce it to the high energy efficiency scenario in the above graph. From the EU’s viewpoint (and that of the remainder of the developed world), it is vital to underline that improving energy efficiency is a priority.

Jean-Michel Glachant, Loyola de Palacio Professor in European Energy Policy, European University Institute and Christopher Jones, Head of Cabinet of Commissioner Piebalgs, European Commission. All views contained in this post are strictly personal.

P.S. This post is extracted from a CEEPR/MIT Working Paper.

This entry was posted on Friday, May 28th, 2010 at 9:07 am and is filed under Energy Policy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.