One of my favourite publications is the annual BP Statistical Review of World Energy, the 2012 edition of which has just been published. It gives energy consumption and production statistics for all the regions in the world and for many individual countries.
It remains the most useful publication of its kind. The statistics are collected and analysed by staff of Heriot-Watt University and they and BP deserve great credit for yet another excellent report.
I spend most of my time working for the oil industry and it is easy to miss the bigger picture of world energy trends. Similarly, if your work is concentrated in one region such as the North Sea it is easy to be ignorant about what is happening elsewhere, such as the shale gas revolution in the US.
There is much economic and financial gloom in Scotland and the wider Europe at the present time. We are either in another recession or a period of very low growth.
It may surprise therefore that BP’s latest review shows that global primary energy consumption increased by 2.5% in 2011. However, there was a 0.5% fall in Europe, including a drop of 5.2% in the UK. In North America there was a tiny 0.3% rise.
The fall in Europe was a consequence not just of the economic downturn but of the continuing success of energy conservation and energy efficiency measures in many countries.
The region with the highest growth in energy consumption was – not surprisingly – the Asia-Pacific region, with a 5.4% increase, followed by the Middle East with 4.3%. China recorded an 8.8% increase and now accounts for over 21% of total world energy demand, overtaking the US with 19%. India’s consumption jumped 7.4%.
Economic growth in China and other parts of Asia-Pacific has slowed down in recent months but there is little chance of it falling to UK or Eurozone levels. The region will undoubtedly be the main influence on the world’s energy industries over the next several years.
I was surprised to read that energy consumption in Africa rose only 0.6%. The economies there should be doing much better than they currently are.
Of the total energy consumption in 2011, oil supplied 33%, coal 27%, gas 24%, nuclear 5%, hydro 6% and other renewables 2%. These shares have also changed significantly in recent years and I expect the trends to continue.
Nuclear electricity generation and consumption fell 4.3%, mainly because of the disaster in Japan.
Coal production increased 6.1% and consumption by 5.4% (mostly in Asia-Pac. The sector has benefited from relatively low prices compared with oil, particularly for power generation.
Oil production increased 1.3% and consumption by 0.7%, both of which were significantly below the worldwide average of 2.5% growth. I believe the main reason for that was high oil prices during the year, which depressed demand in some markets, including the UK.
The gas industry did a little better during 2011. One of the most notable features was a 7.7% rise in production in the US because of the shale gas revolution. The country could soon become a net exporter of gas rather than importer. This could have wider implications, particularly by depressing international LNG prices.
Renewable energy production increased by a massive 17.7% during 2011 but still accounted for less than 2% of total energy supply. However, it is much more important in some countries such as Scotland.
I have put pressure on BP during the last few years to improve its renewable energy statistics but I recognise that is a difficult task. For example, I am currently working in three South Pacific countries where 80% of the population have no access to electricity and where biomass is their main source of energy. The official statistics are mainly limited to imported oil products and electricity generation, and obviously give very incomplete and inaccurate pictures.
Nevertheless, I hope that BP and Heriot-Watt can find ways of improving the renewable energy statistics in their otherwise excellent publication.
Tony Mackay is the MD of energy economists Mackay Consultants