On 14 February, BP launched its 2019 Energy Outlook in London. The yearly report presents the company’s views on where energy consumption and carbon emissions are headed in the medium-to-long-term. The Outlook is the result of internal and collaborative research used to inform BP’s strategy and contribute to wider discussions of energy transitions and comprises certain scenarios based on hypothetical economic, geopolitical, and technological futures. The 2018 and 2019 Outlooks can be compared to reveal revised expectations for the long-term future of energy demand and emissions.
In the 2018 Outlook’s “evolving transitions” scenario—a moderate scenario that allows current policies to play out—renewable energy accounted for 40% of the growth in total primary energy the world demands by 2040. The 2019 Outlook places this proportion above 50% and concludes that, by 2040, renewable energy will become the largest source of power generation. BP has a history of underestimating the growth of renewables in its Outlook.
Geopolitical developments over the past year, notably the prospect of a reduced pace of globalisation, have led to BP including a new scenario that considers the impact of persistent and high trade barriers on energy transitions. The 2019 Outlook signals that a pessimistic view of globalisation implies lower overall energy demand, primarily caused by slower GDP growth because of less trade and higher energy prices. However, in oil and gas producing countries, domestic production substitutes and stifles the growth of renewables.
A core message that has persisted in BP’s Energy Outlook is that fossil fuel demand will not be substantially impacted by the growth of electric vehicles (EVs). In the 2018 Outlook, fossil fuel demand remained high in one scenario that considered a global EV fleet of a billion vehicles following a ban on internal combustion engines. The 2018 moderate scenario predicted a fleet of 320 million EVs by 2040, while the 2019 moderate scenario predicts a fleet of 350 million EVs. BP’s latest stance, while more optimistic for EVs, stands in contrast to projections from other organisations, some of which predict an EV fleet in excess of 500 million vehicles by 2040.
