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Even in the business-as-usual case, BP expects Unsurprisingly, BP sees renewables on the fast-
WHAT: oil demand to reach plateau in the early 2020s. est-growing trajectory, led by rising wind and
BP now expects oil Under the two other scenarios consumption will solar capacity. The share of renewables in final
demand to peak in the never again reach the pre-pandemic level of just energy consumption is seen expanding from a
early 2020s, if it has not above 100mn barrels per day (bpd). little over 20% in 2018 to 34% in the business-as-
done so already. The business-as-usual case sees oil demand usual case, 45% in the rapid case and over 50% in
reaching 10% below the current level in 2050, the net zero case.
WHY: whereas the rapid and net-zero scenarios pre- Growth will be driven by falling costs, which
Just a year ago, the UK dict much sharper declines of 55% and 80% are expected to be 30% and 65% lower for wind
major was expecting to respectively. These declines will be driven by and solar respectively by 2050 under the rapid
reach this milestone in increasing efficiency and the electrification of scenario, and by 35% and 70% respectively in
the 2030s, but the pan- road transport. the net-zero scenario.
demic and an accelerated
energy transition have Carbon prices will also play a key role. The Electrification will also increase in all three
changed the picture. business-as-usual case assumes they will reach scenarios, with the share of electricity in the final
$65 per tonne in developed countries by 2050 energy mix rising from 20% in 2018 to 34% for
WHAT NEXT: and $35 per tonne in emerging economies. But business-as-usual, 45% for rapid and over 50%
Gas will fare better, but the net-zero case sees them soaring to as high as for net zero.
renewables are in for $250 and $175 per tonne respectively. Hydrogen and bioenergy are pitched as
rapid growth. BP itself is Oil use in transport will peak in the mid- another way of decarbonising energy. Hydrogen
targeting a 40% cut in oil to-late 2020s in all three cases. Its share in the will increase its share to 16% under the net zero
and gas production over sector’s fuel mix will fall from 90% in 2018 to and 7% under the rapid case, whereas bioenergy
the next decade. around 80% by 2050 under the business-as- will grow to 10% of primary energy in the net
usual case, only 40% in the rapid one and just zero case and 7% in the rapid one.
20% under net-zero assumptions.
The outlook for gas is markedly better, how- Commitments
ever, supported “by broad-based demand and With new CEO Bernard Looney at the helm,
the increasing availability of global supplies,” BP BP has embraced the energy transition, more so
said. than any of the world’s other leading oil and gas
Under the business-as-usual case, BP pre- companies. This was demonstrated in BP’s net-
dicts it to surge by a third over the next three zero strategy unveiled last month.
decades, from 3.93 trillion cubic metres last The strategy called for a 40% reduction in the
year, according to BP’s own estimates. Under company’s oil and gas production over the next
the rapid scenario, demand will peak in the mid- decade, and a similar scaling back of its refining
2030s but will still be around the same level in operations. It also aims to bolster annual invest-
2050 as in 2018. But according to the net-zero ments in clean energy tenfold by 2030.
case, demand will peak as soon as the mid-2020s “The world is on an unsustainable path: the
and drop by a third by 2050. scenarios show that achieving a rapid and sus-
Gas has two main roles in the energy tran- tained fall in carbon emissions is likely to require
sition, BP said. First, it can displace coal in a series of policy measures, led by a significant
fast-growing, developing economies where increase in carbon prices,” BP concluded. “These
renewables cannot be deployed fast enough; policies may need to be further reinforced by
second, it can be combined with carbon, capture shifts in societal behaviours and preferences.”
and storage (CCS) to produce near zero-carbon Delaying either policies or societal shifts will
energy. The rapid and net-zero scenarios see gas only make the challenge greater and add to the
combined with CCS accounting between 8 and economic cost and disruption, the company
10% of primary energy in three decades’ time. warned. ™

P6 www. NEWSBASE .com Week 37 16•September•2020