Current forecasts suggest that global energy consumption will only increase by 3% in 2012, not much different from 2011. This is not surprising given the state of the world economy. Current market figures suggest that like in 2011, the world will enjoy a net surplus of energy capacity.
Take oil, production is likely to again to outpace global demand; such a prospect will once more disappoint peak oil Cassandras. There are several reasons for this; the first is the coming on stream world wide of a number of new offshore projects in Nigerian, Angolan, Brazilian and Gulf of Mexican waters. In addition, increased Libyan and Iraqi oil production coming on stream in 2012 will add significantly to global oil supplies. However, will this be sufficient to reduce current oil prices from around $90 a barrel today to what they were in 2009 when it was $60 a barrel, is anyone’s guess. Yet, such a drop in price would give a welcome boost to the world economy.
Nevertheless, despite investment by many countries in renewables, decision makers are still investing in new cleaner coal based power, which is pushing up coal’s share in the global energy mix. Already, both China and India have placed their faith in increased coal use, this is not surprising given its strategic, economic and energy security advantages. After all coal provides a cheap source of fuel to power all those new laptops, televisions and air-conditioning units that increasing numbers of their fortunate citizens can afford to use.
Yet, the big winner in 2012 is forecast to be gas. During 2012, new commercially significant natural gas supplies are due to come on line in Qatar and Australia. Already, it is fortunate for Japan due to its on-going nuclear outages that such additional LNG supplies are available during its current power shortages, which are likely to last for several years. In addition, unconventional gas will increasingly play its part; already Australia and the United States have well advanced plans to export unconventional gas as LNG to markets in North Asia and Europe. In fact some market makers in Europe are complaining that Europe from too much gas and competition being available in the market. As for elsewhere in the world, there are less advanced plans to exploit unconventional gas for regional markets in Argentina, Poland, South Africa and China. Such developments are likely to change the shape of energy geopolitics in the near future.
Though the future progress of unconventional gas is likely to be affected by the results of reports, due out in early 2012, by the Environmental Agencies of the EU and US into the impact that fracking has on the water table.
As for nuclear, after events at Japan’s Fukushima Daiichi nuclear plant, one would have thought we had seen the end of nuclear power. Certainly, Germany thought so when it pulled the plug on its nuclear power programme. Well, in fact forecasters are suggesting the future looks bright in many countries, whilst in America and Japan these countries have dithered about a nuclear future. Other countries like Britain, France, China, Russia and South Korea have improved their designs and moved ahead with their programs. In fact, it is likely that half the world’s new nuclear power plants will be completed in such countries as China, Taiwan, Thailand, Indonesia, Vietnam and South Korea by 2050. It is forecasted that by 2020, China is expected to increase its nuclear generating capacity seven fold and South Korea to double its nuclear power capacity.
Over all the future looks bright especially for gas; however, the world will continue to experience at regional level problems providing sufficient capacity to turn raw energy into a useful power source.