Transcript 1.3 MB - WBCSD

Energy
Doing Business with the World - The new role of
corporate leadership in global development
Geneva, September 2007
World Business Council for
Sustainable Development
Overview

The global view: Tomorrow’s energy demand

Energy: An essential for economic and social
development

Share of traditional biomass in residential
consumption

Energy options at the base of the pyramid
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The global view: Tomorrow’s energy
Energy market segments
demand
Energy demand is
expected to
increase by 50%
between now and
2030, according to
the International
Energy Agency.
Predicted increase in world primary energy demand,
according to reference scenario
Source: World Energy Outlook 2006
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Energy: An essential for economic
and social development
Growing
demand
Global population divided
into income groups:
 Poorest (GDP < $1,500)
 Developing (GDP < $5,000)
 Emerging (GDP < $12,000)
 Developed (GDP > $12,000)
Population
growth
Primary energy
Developed (GDP>$12,000)
Emerging (GDP<$12,000)
Developing (GDP<$5,000)
Poorest (GDP<$1,500)
10000
By 2050, world
population could rise
to around 9 billion.1
8000
6000
4000
Shifting the development profile
further to a “developed” world
means energy needs triple by 2050
Population, millions
Shifting the development profile
to a “low poverty” world means
energy needs double by 2050
2000
Base case
2000
Low
Poverty
2050
Prosperous
world
0
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Source: WBCSD adaptation of IEA 2003
Population
growth
Share of traditional biomass in residential consumption
According to the IEA, traditional biomass accounts for over 90% of
household energy use in many developing countries.
Without access to modern
energy sources such as
electricity, the poor have
to spend time gathering
biomass fuels instead.1
Annual deaths from indoor air pollution
2.8
millions
3
2
1.2
1.3
1.6
1
0
Source: IEA, World Energy Outlook 2006.
Malari
a
Smoke
TuberculosisHIV/AIDS
from biomass
Source: IEA, World Energy Outlook 2006.
55
Energy options at the base of the pyramid
Patterns of fuel use
change as household
income changes.1
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Needs &
Challenges

Growth, development, and energy demand

Societal needs

Projected energy demand in developing
countries

What are the key challenges?

Energy for development: competing interests
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Growth,
Growth,development
developmentand
andenergy
energy
"Energy is one of the areas that shows
demand
demand
most clearly the gap between the global
rich and the global poor, and the social and
economic inequities that result."
Basic premise:
energy use and growth are strongly linked
-Millennium Campaign
400
Energy is a key
indicator of human
development.
300
250
Global Trend
EU-15
North America
Korea 1970-2000
Malaysia 1970-2000
China 1970-2000
200
150
100
50
0
$0
$5'000 $10'000 $15'000 $20'000 $25'000 $30'000
GDP per capita, US$ 1995 ppp
88
Source: WBCSD adaptation of IEA 2003
Energy Use, GJ per capita
350
Societal needs
Access to sources of energy are unequal
People without access to electricity, 2005
Measured base of the
pyramid (BOP) spending
on energy splits about
40% urban, 60% rural.1
The base of the pyramid
is defined as those with
incomes less than US
$3,000 in local
purchasing power. 1
However, rural
households spend an
average of 44% less on
energy than do their
urban counterparts. 1
Source: IEA. World Energy Outlook 2006
99
Projected energy demand in developing
countries
Projected primary energy demand in developing countries
Source: IEA. World Energy Outlook 2006
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10
What are the key challenges?
 Fossil fuels are unevenly distributed
 Raw materials for generating energy are
limited in scope for export
 National development strategies lack
comprehensive energy policies
 Negative environmental impacts
 Bottom-up approach needed: making
energy affordable and changing
consumption habits
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Energy
Energyfor
fordevelopment:
development: competing
competing
interests interests
Energy
Development
MNCs: Localising
operations
Growth
Access
Security
Business
solutions
Local businesses:
SMEs / Microentrepreneurs
Climate
change
Eco-systems
Biodiversity
Environment
People:
Basic needs
Product use
In developing areas,
industries, schools, and
hospitals are at the mercy of
sporadic power supplies and
regular power outages that
hinder efficiency and
delivery of basic services.
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12
Opportunities

Sustainable energy future

Market size

Market opportunities

Key messages

WBCSD Resources
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Sustainable energy future
The key to a sustainable energy future for
the planet rests on four actions:
 A move toward a low-carbon economy
 Reduced dependency on fossil fuels
 Significantly improved energy efficiency across
all sectors
 The development of cheap and affordable
energy solutions
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Market size
According to the International Energy
Agency, energy demand is expected to
increase by 50% between now and 2030
Households in the BOP500 income
group spend $148 (on average) per
year on energy; an average of $264
for those in the BOP1000; and $379
annually in BOP1500.1
These amounts may be
small, but when
aggregated, they form
large, underserved
markets.
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Market Opportunities
 Market expansion in developing countries
 New markets are emerging in alternative
energies, energy conservation services, and
energy efficient technologies.
 Opportunity for building and marketing these
products and services
 Opportunity for businesses that are more
energy efficient to enjoy lower operating costs
and reduced exposure to potentially volatile
energy prices.
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Key messages
For business, investing in
sustainable energy services can:
Create new markets and associated
revenue streams for energy related
products and services for the currently
underserved in developing countries
Create competitive advantage by
developing new and affordable energy
technologies that reduce emissions
and/or improve energy efficiency
Reduce reliance on fossil fuels in
the energy mix
Lower operating costs by improving
energy efficiency
For governments, an effective policy
framework for sustainable energy
services can:
Improve access and reliability of energy
supplies
Lead to successful implementation of
lower carbon technologies using
Promote growth in the SME sector to
provide energy services, particularly in rural
areas
Raise consumer awareness on energy
efficiency
Improve public health by promoting
cleaner forms of energy supply
Reduce deforestation and ecosystem
degradation from harvesting biomass
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WBCSD Resources
Policy Directions to 2050: A business contribution to the dialogues on
cooperative action asserts that the only way to combat climate change is
through decisive, concerted and sustained actions between
governments, businesses and consumers.
Pathways to 2050 - Energy & climate change builds on the WBCSD’s
2004 Facts and Trends to 2050: Energy and Climate Change and
provides a more detailed overview of potential pathways to reducing
CO2 emissions.
Facts & Trends to 2050: Energy & climate change provides an overview
of key facts and societal challenges related to economic development,
future energy demand and the impact that demand could have on the
climate system.
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www.wbcsd.org/web/development.htm