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Energy demand
As societies advance, they will continue to need energy to power homes, businesses, industry, transportation, electricity generation and other vital services. The Outlook examines each of those demand sectors in detail.
Residential/commercial
Homes and businesses represent a significant portion of global energy demand, especially when electricity usage is considered. Through 2040, economic expansion, rising prosperity and a continued rise in the number of households globally will cause demand to grow by 25 percent in the residential/ commercial sector. Virtually all of this increase will come from Non OECD
Economies not belonging to the Organization for Economic Cooperation and Development countries, and almost all of it will be met by two forms of energy: electricity and natural gas.
By 2040, there will be 2.8 billion households in the world, an increase of nearly 50 percent from 2010. These households will need energy for lighting, heating, cooking, hot water and refrigeration, as well as electricity to run everything from computers to air conditioners.
Transportation
One of the most profound shifts in energy usage through 2040 will come from the transportation sector. The proliferation of hybrid and other advanced vehicles—along with improvements to conventional-vehicle efficiency—will result in flattening demand for personal transportation, even as the number of personal vehicles in the world doubles. In contrast, demand for fuel for commercial transportation—trucks, airplanes, trains and ships—will continue to rise sharply.
From 2010 to 2040, demand for energy for commercial transportation will rise by more than 70 percent. Most of this growth will come from heavy duty vehicles, which include freight trucks of all sizes, as well as buses, emergency vehicles and work trucks. Global economic growth will drive a steep increase in demand for energy for commercial transportation, as business activity and rising incomes enable increased movement of goods—both within and between nations.
Industrial
A source of economic activity and jobs, the industrial sector uses energy to produce the materials and goods that are the building blocks of modern life. Compared to the transportation and residential/commercial sectors, the industrial sector can seem less connected to the day-to-day lives of consumers. But industry uses energy to make a host of essential products including plastics, steel and textiles. This sector also includes energy used for agriculture, as well as the energy required to produce oil, natural gas and coal.
Globally, industrial demand for energy is expected to grow by about 30 percent from 2010 to 2040 and will continue to come from Non OECD countries. However, by extending The Outlook for Energy to 2040 this year, we can spot some important trends emerging within the Non OECD: a flattening of industrial demand in China, and a pickup in growth in places like India and Africa.
Electricity Generation
The electricity generation sector is essential to meeting modern energy needs. Utilities and other electricity producers transform different types of primary energy—everything from natural gas to coal to wind and hydroelectric power—into electricity to be used in homes and businesses. Through 2040, global demand for electricity will continue to rise steeply, as the fuels used for electricity generation continue to shift to lower-carbon sources, such as natural gas, nuclear and renewables.
