Technology to Boost Energy Supplies, Lower-Carbon Future

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Advances in technology will keep energy supplies plentiful and affordable—enough to meet projected demand many times over—and help pave the way to a lower-carbon energy mix, according to data published Nov. 2 in the BP Technology Outlook. The 80-page publication brings together previously internal BP analysis and the work of other business and academic experts, setting out technology and policy choices governments and industry can make around energy resources, oil and gas supply, power generation, transport, and options for reducing carbon emissions.

The BP Technology Outlook finds that simply applying today’s best technologies to discover oil and gas resources could significantly increase proved reserves from 2.9 trillion bbl of oil equivalent to 4.8 trillion bbl—nearly double the 2.5 trillion bbl required to meet projected cumulative global demand through 2050. In the power sector, which currently accounts for 38% of world primary energy demand, gas- and coal-fired power are generally the most competitive today. BP’s analysis predicts that wind and solar will continue reducing costs at around 14% and 24%, respectively, per doubling of installed capacity consistent with past performance, and therefore become more competitive over time.

In North America, and ignoring taxes and subsidies, modern combined-cycle gas turbine power plants would have a cost advantage over coal today if policymakers were to adopt a modest price on carbon dioxide of less than $40 per tonne. By 2050 a carbon dioxide price of $80 per tonne would make onshore wind technology competitive with gas-fired power, with utility-scale solar photovoltaic close to being competitive, even accounting for the cost of managing intermittency. This price on carbon would also make carbon capture and sequestration with gas-fired power economic, BP observes.

The publication suggests that liquid fuels will continue to dominate global transportation through 2035 and beyond, largely due to their high energy density. The average efficiency of new light-duty vehicles is expected to improve by 2% to 3% per year as a result of increased hybridization and improved powertrains, combined with advanced fuels and lubricants. By 2050, electric vehicles could be approaching cost parity with the internal combustion engine due to advances in battery technology, while fuel cell vehicles could still have further to go.

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