India, China fuel use levels ‘unsustainable’

India, China fuel use levels ‘unsustainable’

New York: China’s and India’s surging fuel consumption poses a growing challenge to the world’s energy systems and, unless curbed, will strain global oil trade, push up prices and lead to substantially higher carbon dioxide emissions in the coming decades, according to a report by an influentialenergy organization released on Wednesday.

In unusually urgent tones, the International Energy Agency, which provides policy advice to industrial nations, urged advanced economies to work with China and India to cut overall growth in energy consumption. Otherwise, it said, runaway demand in those countries will put heavy pressure on supplies and make it impossible to achieve meaningful reductions in carbon dioxide emissions, the main culprit in global warming.

“There is a need for an electroshock," said Fatih Birol, the agency’s chief economist and the lead author of its flagship publication, The World Energy Outlook. “We have to act immediately and boldly."

Bolstered by speedy economic development and industrialization, energy demand from Asia has been one of the main contributors to higher oil prices. In the last two years, China and India accounted for about 70% of the increase in energy demand.

Strong demand has helped push oil prices to a series of records in recent weeks. Oil settled in New York on Tuesday at a record $96.70 a barrel.

The energy agency sees the next decade as crucial for the stability of the global energy system. Decisions made today in China and India—for example, whether to continue investment in coal-fired power plants or to adopt policies to tackle global warming—will have worldwide consequences for decades.

By 2030, China and India are projected to account for nearly half the rise in global demand. Worldwide, energy use is to increase by about 55%.

China and India argue that it is unfair to blame them for rising energy prices and have resisted calls to limit carbon emissions when their economies are trying to catch up with development levels inthe West. Energy use perperson in those countries remains much lower than in industrial nations.

In its report, the energy agency recognized the legitimate aspirations of China and India to improve the lives of their people. But it said that solving energy problems is a global responsibility that demands action by all countries. “China’s and India’s energy challenges are the world’s energy challenges, which call for collective responses," it said.

China is expected to overtake the US and become the largest energy consumer soon after 2010, according to the report’s forecasts. In India, where more than 400 million people have no access to electricity, energy demand is expected to more than double by 2030. One consequence of that unfettered growth will be higher carbon dioxide emissions, expected to rise 57% over the next 25 years, the agency said.

China will overtake the US to become the world’s biggest carbon emitter this year, while India becomes the third biggest emitter around 2015, according to a preview copy of the report, which this year focuses on China and India.

Next year, China will need to install 800 gigawatts ofpower generating capacity, about as much as Europe has. Its emissions per person will reach those of Europe by 2030, the report found. “This is a veryworrying message," Birol said. “China and India are transforming our energy markets. We have a window of opportunity of 5-10 years beforeit becomes unsustainableand irreversible."

As the need for oil imports grows, and supplies level off in many industrial nations, the world will become increasingly reliant on a smaller number of oil exporting countries, mainly in West Asia and Russia. As a consequence, the agency said, global energy security will increasingly be at risk.

China’s and India’s net oil imports are expected to jump to 19.1 million barrels a day in 2030 from 5.4 million barrels in 2006, more than what the US and Japan now import.

By 2030, global oil demand is expected to reach 116 million barrels a day. The use of coal, made attractive by oil and natural gas prices, is expected to rise 73% in the next 25 years, mostly because of use by China and India. The share of natural gas is projected to increase modestly while electricity use doubles.

Even if every country adopted economy measures today, the agency said carbon emissions would still be 25% higher in 2030 than they are now.

Cutting carbon emissions in a meaningful way would require “exceptionally quick and vigorous policy action by all countries, and unprecedented technological advances, entailing substantial costs," the report said. Tougher efficiency standards for air-conditioners and refrigerators in India and China could, by 2020, save the amount of power produced by the enormous Three Gorges dam of China, it said.