Differences in Energy Consumption Forecasts are a Common Phenomenon

5 december 2017 | Rossiyskaya Gazeta

"Differences in energy consumption forecasts are quite normal. In many ways, the difference is caused by quite objective reasons: different models for the development of forecasts, different databases," said Victoria Gimadi, an expert of the Analytical Center, to a Rossiyskaya Gazeta reporter.

Victoria Gimadi
Victoria Gimadi
Department for Fuel and Energy Sector

Ms. Gimadi told about the Energy Bulletin of the Analytical Center, where the forecasts of the IEA, the U.S. Energy Information Administration and the Organization of the Petroleum Exporting Countries were analyzed. They reflect the main factors that change the perspective of experts in the energy sector.  

According to the expert, different forecasts use different prerequisites both for macro parameters and for possible changes in future trends (when a particular technology will appear, whether large projects will develop in particular countries, whether a country will use those energy sources, the transition to which is being currently planned).

An interesting conclusion can be drawn about the consumption of coal worldwide: it will grow until 2040, despite the weakening of positions in the energy balance in favor of other energy sources, as the expert noted. For example, OPEC expects a 10 percent increase in coal demand, including due to the Indian market and Southeast Asia, but the market for renewable energy sources in the baseline scenarios of OPEC, the U.S. Energy Information Administration, and IEA will grow by about 1.8-1.9 times.

"The more intensive growth of renewable energy sources corresponds to the solution of climate problems. It should be noted that countries, including India and the countries of Southeast Asia, have not yet made specific commitments under the Paris Agreement to reduce coal consumption or to decommission coal power stations and to ban the launch of new ones. Given the current state of the energy sector in these countries, it will be difficult for them to develop and ensure the reduction in coal consumption," said Gimadi.

The increase in oil consumption in all baseline scenarios of forecasts ranges from 12 to 19 percent, but the share of oil in the structure of the power balance, as in the case with coal, will gradually decrease. The forecasts for Russia differ significantly: The IEA predicts a 23.9 percent drop in oil production in Russia by 2040, OPEC assumes one percent, and the U.S. EIA, expecting a more sustainable growth in demand for oil and oil products after 2025, on the contrary, predicts a three percent increase in production in 2015-2040.

Experts note in the Energy Bulletin that multidirectional forecasts indicate a high level of uncertainty about the opportunities and competitiveness of the Russian oil industry over the long term. "In this regard, it is important for Russia to adopt the least risky strategy in export markets," said Leonid Grigoriev, Chief advisor to the Head of the Analytical Center.

Source: Rossiyskaya Gazeta