Energy Myopia

In the middle of this constitutional and pipeline wrestling match between BC and Alberta, it is easy to lose sight of the big picture.  While Western Canadians focus on questions about safety of whale pods, how long diluted bitumen floats and when is there enough indigenous consultation – the larger global issues go unnoticed.

Beyond this wrestling match is the real driver of energy production and transportation – the global consumer!

Demand for energy and fossil fuels is rising in the world. Energy to meet that demand will come from somewhere – even if Canada decides ‘Oilsands Self-Immolation’ (that is committing suicide as a sacrifice) is our best course of action.

Government organizations and energy companies look at the long-term future, and prepare forecasts of supply and demand.  There are numerous scenarios that examine future consumer demand and the impact of our efforts to constrain carbon use.  Here are a few factoids to consider:

  • According to the US Energy Information Administration, the demand for oil from China and India will be 10 million barrels per day which will account for about 90% of the increase in world demand between 2015 and 2040
  • Shell’s research tells them that the developed world’s (OECD) energy demand is decreasing since 2005, but in the rest of the world, demand has increased 2.5 times at the same time that the developed world demand  declines
  • Exxon Mobil’s forecast concludes that almost 2.5 billion people in the developing world will join the economic ‘middle class’. This means the end to poverty for those people, and more fuel used in the economy. It also means more cars, appliances and air-conditioners
  • British Petroleum’s base scenario forecasts that the world economy will almost double in next 20 years and population will increase by 1.5 billion people. Energy consumption is expected to grow by 30%. Fossil fuels will account for 75% of the world energy mix, down from 85% today.

Canada’s oil industry forecasts that crude production from oilsands rises from 2.4 to 3.7 million barrels per day by 2030. Overall, Canadian production could reach 5.1 million barrels per day. Current pipeline takeaway capacity is about 4.0 million barrels per day.

Much of the rationale of the “leave it in the ground” activists is based on the fear that climate change represents a threat to the existence of the human race.  That runs headlong into the reality that today’s, and the future’s, global end use consumers, also see continuing poverty as an existential threat to them and their children!