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AsiaElec COMMENTARY AsiaElec

Total sees oil demand

peaking in 2030

Faced with gloomier prospects for oil, Total is
doubling down on gas and renewables

GLOBAL FRENCH oil major Total has joined other oil “Momentum goes beyond the business-as-
companies predicting that peak oil demand will usual scenario; nevertheless, it fails the well-be-
WHAT: arrive in the coming decade, forecasting an end low 2oC target globally,” Kristoffersen said.
Total has forecast in its to consumption growth in 2030. Rupture, on the other hand, sees all countries
Energy Outlook that oil This represents a more bullish forecast than pledging net-zero targets while also envisaging
demand will peak in that of UK peer BP, which recently warned that breakthroughs in as-yet-unproved technologies
2030, or possibly sooner, oil consumption would peak in the early 2020s, such as hydrogen, synthetic fuels and carbon
depending on the pace of if it has not done so already. However, it still capture. This will enable them to be developed at
decarbonisation efforts marks a major turnaround in Total’s thinking. scale to cut emissions. As such, global tempera-
Just a few years ago Pouyanne described peak oil ture growth will be limited at 1.5-1.7oC.
WHY: demand as merely a possibility. Consumption While primary energy consumption will
Oil will begin to cede could reach its height sooner than 2030, Total climb by 0.6% annually in Momentum, it rises
market share in transport now says, depending on the pace of decarbon- by only 0.4% per year in Rupture.
to cleaner fuels, and isation efforts. Solar and wind power will see a rapid expan-
the petrochemicals Faced with gloomier prospects for oil, Total is sion in usage in both scenarios, being deployed at
sector will undergo a not only looking to expand in renewable energy a rate of more than 200 GW per year in Momen-
transformation, Total says but also gas, which it sees as having a much tum and over 500 GW per year in Rupture. The
stronger outlook. Gas will have an important share of EVs in transport will also soar to 60%
WHAT NEXT: role in decarbonisation by displacing dirtier in Momentum and 75% in Rupture, compared
Total believes the outlook fuels, Total argues, especially as greener gases with the current 1%. Carbon capture and storage
for gas is much stronger. are adopted. (CCS) capacity will also be scaled up to 2,000-
It plans to double its “Oil demand will reach a plateau around 2030 7,500 gigatonnes per year.
LNG sales within the next and then decline slowly thereafter due to trans- Gas will primarily seize market share away
decade and focus on port and petrochem accelerated transforma- from coal and oil. In Momentum, its consump-
making gas greener tion,” Total’s president for strategy-innovation, tion will increase by 1.3% annually and reach 5.7
Helle Kristoffersen, said. “Gas will continue to trillion cubic metres by 2050. Its biggest gains
play a key role for decades. It has a key role to play will be in Asia, where it will substitute a lot of
in power systems, heat and in transport.” coal-fired generation. Gas will remain vital in
power generation, in industry and in residential
Energy outlook and commercial sectors, Kristoffersen said. It
Kristoffersen was discussing Total’s Energy will also expand in transport, becoming a more
Outlook report published on September 29. The widespread fuel for vehicles and ships.
company forecast continued growth in global Even in Rupture, gas will remain an impor-
energy demand over the next three decades in all tant means of ensuring power grid stability and
scenarios considered, by 10-25% in total during flexibility at an affordable cost, Total said. Under
the period. But this extra demand will be met by that scenario, demand for natural gas will peak
low-carbon power. in 2040, but consumption will continue climbing
Electricity’s share of final energy consump- beyond 2050 if hydrogen and other green gases
tion will rise from 20% currently to 30-40% by are included in the mix.
2050. “To fully play its role in the energy transi-
Total bases its predictions on two main sce- tion, gas has to become much greener and much
narios which it calls Momentum and Rupture. cleaner,” Kristoffersen explained. “That will
Both envisage Europe becoming carbon neutral come at a cost, at least in the early years.”
by 2050 – the goal set in the European Green In Momentum, the share of green gas will be
Deal. Momentum sees countries in the rest of the limited by its higher cost and a lack of sufficient
world pursuing their existing national climate carbon regulation. Even so, it should rise to 8%
targets, as well as an aggressive deployment of of total gas supply by 2050, versus 0.1% in 2018.
proven clean technologies such as electric vehi- But in Rupture, the share of green gas will exceed
cles (EVs), solar, wind and biofuel. 25% within three decades.

P4 www. NEWSBASE .com Week 40 07•October•2020