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Energy Outlook

2020 edition
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The Energy Outlook The Energy Outlook considers a number of different scenarios. These
scenarios are not predictions of what is likely to happen or what bp
explores the forces would like to happen. Rather they explore the possible implications of
shaping the global different judgements and assumptions concerning the nature of the
energy transition. The scenarios are based on existing and developing
energy transition technologies which are known about today and do not consider the
possibility of entirely new or unknown technologies emerging.
out to 2050 and the
Much of the analysis in the Outlook is focussed around three
key uncertainties scenarios: Rapid, Net Zero and Business-as-usual. The multitude of
surrounding that uncertainties means that the probability of any one of these scenarios
materializing exactly as described is negligible. Moreover, the three
transition scenarios do not provide a comprehensive description of all possible
outcomes. However, the scenarios do span a wide range of possible
outcomes and so might help to inform a judgement about the
uncertainty surrounding energy markets out to 2050.
The Energy Outlook is produced to inform bp’s analysis and strategy
and is published as a contribution to the wider debate. But the Outlook
is only one source among many when considering the future of global
energy markets and bp considers a wide range of other analysis and
information when forming its long-term strategy.

3 | bp Energy Outlook: 2020 edition

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In February of this year, bp In August, we set out a new strategy

announced a new purpose – to in support of this purpose and
reimagine energy for people and our ambition. It will see bp transform
planet. This purpose was supported from an International Oil Company
by a new ambition, to be a net-zero focused on producing resources to an
company by 2050 or sooner and to Integrated Energy Company focused
help get the world to net zero. on delivering solutions for customers.
From IOC to IEC. And while the
Our new purpose and ambition are Covid-19 pandemic has had a huge
underpinned by four fundamental impact on the global economy and
judgements about the future. That energy markets, it has not affected
Welcome to the the world is on an unsustainable path
and its carbon budget is running out.
our belief in and commitment to our
purpose, ambition and strategy.
2020 edition of That energy markets will undergo
lasting change, shifting towards That belief and commitment is in
bp’s Energy Outlook renewable and other forms of zero- no small part down to the objective
or low-carbon energy. That demand analysis that goes into every edition
for oil and gas will be increasingly of the Energy Outlook. It does not to
challenged. And that, alongside many try to predict precise future outcomes
others, bp can contribute to the – any attempt to do that is doomed to
energy transition that the world wants fail. Instead, it helps us to understand
and needs, and create value doing so. the many uncertainties ahead – in the

near and longer term – by considering Customers will continue to Countries, cities and industries will
a range of possible pathways the redefine mobility and convenience, increasing want their decarbonized
energy transition may take over the underpinned by the mobility energy and mobility needs met
next 30 years. This year’s Outlook revolution that is already underway with bespoke solutions, shifting the
explores three main scenarios – combining electric vehicles, shared centre of gravity of energy markets
Rapid, Net Zero and Business-as- mobility and autonomy. towards consumers and away from
traditional upstream producers.
usual – which span a wide range Oil and gas – while remaining
of possible outcomes. Those three needed for decades – will be The Energy Outlook has been tracking
scenarios have helped us to develop increasingly challenged as society and analysing the trajectory of the
a strategy that we think is robust to shifts away from its reliance on fossil world’s energy system for the past
the uncertainty around the pace and fuels 10 years. This year’s Outlook has
nature of the energy transition. been instrumental in the development
And those core beliefs lead us to
of the new strategy we announced in
Three features are common across three more about how the energy
August. I hope it is useful to everyone
those scenarios and they form a set system will change out to 2050:
else seeking ways to accelerate the
of core beliefs as to how energy energy transition and get to net zero.
demand is likely to change over the The energy mix will become
We welcome any feedback on the
next three decades: more diverse, driven increasingly
by customer choice rather than content and how we can improve.
resource availability.
Renewable energy will play an
increasingly important role in meeting Markets will need more integration
the world’s growing energy needs. to accommodate this more diverse
supply and will become more
localized as the world electrifies Bernard Looney
and the role of hydrogen expands. chief executive officer

5 | bp Energy Outlook: 2020 edition

Executive summary
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Key messages

Global energy demand continues levels of integration and competition.

to grow, at least for a period, driven These changes underpin core beliefs
by increasing prosperity and living about how the global energy system
standards in the emerging world. may restructure in a low-carbon
Significant inequalities in energy transition.
consumption and access to energy
persist. Demand for oil falls over the next
30 years. The scale and pace of this
The structure of energy demand decline is driven by the increasing
is likely to change over time: efficiency and electrification of road
declining role of fossil fuels, offset transportation.
by an increasing share of renewable
energy and a growing role for The outlook for natural gas is more
electricity. These changes underpin resilient than for oil, underpinned by
core beliefs about how the structure the role of natural gas in supporting
of energy demand may change. fast growing developing economies
as they decarbonized and reduce
A transition to a lower carbon their reliance on coal, and as a
energy system is likely to lead source of near-zero carbon energy
to fundamental restructuring of when combined with carbon capture
the global energy system, with a use and storage (CCUS).
more diverse energy mix, greater
consumer choice, more localized
energy markets, and increasing

Renewable energy, led by wind and The use of hydrogen increases as

solar power, is the fastest growing the energy system progressively
source of energy over the next 30 decarbonizes, carrying energy
years, supported by a significant to activities which are difficult or
increase in the development of – and costly to electrify. The production of
investment in – new wind and solar hydrogen is dominated by a mix of
capacity. blue and green hydrogen.

The importance of electricity in The importance of bioenergy –

final energy consumption increases biofuels, biomethane and biomass
materially over the next 30 years. – increases as consumption shifts
The carbon intensity of power away from fossil fuels.
generation falls markedly, driven by
renewables gaining share relative to The world is on an unsustainable
coal. path. A rapid and sustained fall in
carbon emissions is likely to require
The intermittency associated with a series of policy measures, led
the growing use of wind and solar by a significant increase in carbon
power means a variety of different prices. These policies may need to
technologies and solutions are be reinforced by shifts in societal
needed to balance the energy behaviours and preferences.
system and ensure the availability of Delaying these policies measures
firm power. and societal shifts may lead to
significant economic costs and

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Overview 10 Regions 50

Three scenarios: Rapid, Net Zero and Summary 52

Business-as-usual 12 Regional energy demand and carbon emissions 54
Changing nature of global energy system 16 Fuel mix across key countries and regions 56
Global energy trade and energy imbalances 58
Global backdrop 18 Alternative scenario: Deglobalization 60

Total greenhouse gases 20

Global GDP 22 Demand and supply of energy sources 62
Climate impacts on GDP growth 24 Summary 64
Energy demand 26 Oil and liquid fuels 66
Impact of Covid-19 28 Gas 76
Energy access and economic development 30 Renewable energy in power 84
Coal 88
Energy use by sector 32 Nuclear power 90

Summary 34 Hydroelectricity 92

Industry 36
Non-combusted 38
Buildings 40
Transport 42

Other energy carriers 94 Investment 132

Electricity and power generation 96 Summary 134

Hydrogen 102 Upstream oil and gas investment 136

Carbon emissions from energy use 106 Comparisons 138

Summary 108 Revisions to Rapid 140

Carbon pathways 110 Comparing Rapid with external Outlooks 142
Alternative scenario: Delayed and Disorderly 112
Annex 144
Global energy system at net zero 118
Key figures, definitions,
Summary 120 methodology and data sources 146
Energy demand 122
Electrification and the power sector 124
Oil and natural gas 126
Bioenergy and hydrogen 128
CCUS and negative emission technologies 130

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Three scenarios: Rapid, Net Zero and Business-as-usual

Changing nature of global energy system

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Three scenarios to explore the energy transition to 2050

CO2 emissions from energy use

Gt of CO2

40 Rapid
Net Zero
35 Business-as-usual






2000 2010 2020 2030 2040 2050

Key points

This year’s Energy Outlook considers with limiting the rise in global that progress, albeit relatively slow,
three main scenarios which explore temperatures by 2100 to well below means carbon emissions peak in the
different pathways for the global 2-degrees Celsius above pre- mid-2020s. Despite this peaking,
energy system to 2050. industrial levels. little headway is made in terms of
reducing carbon emissions from
The scenarios are not predictions The Net Zero Scenario (Net Zero) energy use, with emissions in 2050
of what is likely to happen or what assumes that the policy measures less than 10% below 2018 levels.
bp would like to happen. Rather, the embodied in Rapid are both added
scenarios help to illustrate the range to and reinforced by significant Primary energy demand increases
of outcomes possible over the next shifts in societal behaviour and by around 10% in Rapid and Net
thirty years, although the uncertainty preferences, which further Zero over the Outlook and by around
is substantial and the scenarios accelerate the reduction in carbon 25% in BAU.
do not provide a comprehensive emissions. Global carbon emissions
description of all possible outcomes. from energy use fall by over 95%
by 2050, broadly in line with a range
The Rapid Transition Scenario of scenarios which are consistent
(Rapid) posts a series of policy with limiting temperature rises to
measures, led by a significant 1.5-degrees Celsius.
increase in carbon prices and
supported by more-targeted sector The Business-as-usual Scenario
specific measures, which cause (BAU) assumes that government
carbon emissions from energy use policies, technologies and social
to fall by around 70% by 2050. preferences continue to evolve in
This fall in emissions is in line with a manner and speed seen over
scenarios which are consistent the recent past*. A continuation of *BAU is comparable with the Evolving
Transition Scenario in previous editions
of the Energy Outlook
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Scenarios differ due to alternative assumptions

about policies and societal preferences
Average carbon prices in developed
and emerging regions Primary energy consumption by source
US$ per tonne (real 2018) EJ

300 800
Business- Renewables
Developed as-usual
Emerging 700 Hydro
250 Nuclear
Rapid Net Zero
Rapid & 600 Coal
200 Net Zero
Natural gas
150 400

50 Business-as-usual

0 0
2015 2020 2025 2030 2035 2040 2045 2050 2018 2050

Key points

The differences between In addition to carbon prices, the As a result of these policies and
the scenarios are driven by three scenarios assume a number shifts in societal preferences,
a combination of different of other policies are enacted to there is a decline in the share of
assumptions about economic affect both the growth of energy hydrocarbons (coal, oil and natural
and energy policies and social consumption and the mix of energy gas) in the global energy system in
preferences. sources across different sectors of all three scenarios. This is matched
the economy: industry (pp 36-37); by a corresponding increase in the
Both Rapid and Net Zero assume buildings (pp 40-41) and transport role of renewable energy as the
a significant increase in carbon (pp 42-49). world increasingly electrifies. The
prices, which reach $250/tonne of scale of this shift varies significantly
CO2 ($2018 prices) in the developed Net Zero is based on the view that across the three scenarios, with the
world by 2050 and $175 in emerging there may be economic and political share of hydrocarbons in primary
economies. This increase in carbon limits to the extent to which an energy declining from around 85%
prices incentivizes significant gains accelerated energy transition can be in 2018 to between 70-20% by 2050
in both energy efficiency and the driven solely by government policies. and the share of renewable energy
use of lower-carbon energy sources. It assumes that the impact of these increasing to between 20-60%.
This policy impulse is much smaller policies is accentuated by the
in BAU, with carbon prices reaching changing behaviour and preferences
only $65 and $35 per tonne of CO2 of companies and households,
by 2050 in developed and emerging with greater adoption of circular
economies respectively. and sharing economies; increased
propensity to switch to low-carbon
energy sources; and less resistance
to the accelerated buildout of low-
carbon technologies and distribution
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Low-carbon transition leads to a fundamental

shift in the global energy system
Shares of primary energy in Rapid

100% Renewables
Natural gas
non-fossil fuels




1900 1915 1930 1945 1960 1975 1990 2005 2020 2035 2050

Key points

The transition to a lower carbon As the importance of coal declined, The increasing diversification of
energy system in Rapid leads to oil became the predominant energy the fuel mix also leads to greater
a fundamental restructuring and source. The energy transition in competition across different forms
reshaping of the global energy Rapid means that for much of of energy as they compete for
system. There are several different the next 20 years the global fuel market share against a backdrop
aspects to these changes. mix is far more diversified than of plateauing energy demand in
previously seen, with oil, natural the second half of the Outlook
First, there is a significant shift away gas, renewables and coal (for a in Rapid. Moreover, the peaking
from traditional hydrocarbons (oil, time) all providing material shares and subsequent decline in the
natural gas and coal) towards non- of world energy. The greater variety consumption of coal, oil and natural
fossil fuels, led by renewable energy. of fuels means that the fuel mix gas in Rapid triggers greater
In Rapid, non-fossil fuels account is increasingly driven by customer competition within individual fuels,
for the majority of global energy choice rather than the availability of as resource owners compete to
from the early 2040s onwards, with fuels, with increasing demands for ensure their energy resources are
the share of hydrocarbons in global integration across different fuels and produced and consumed. This
energy more than halving over the energy services. heightened competition increases
next 30 years. the bargaining power of consumers,
This increased differentiation is further with economic rents shifting away
Second, the energy mix becomes enhanced by the growing importance from traditional upstream producers
far more diversified. For much of of electricity and hydrogen at the towards energy consumers.
history, the global energy system final point of energy use in Rapid.
has tended to be dominated by a These energy carriers are more Similar trends are also apparent in
single energy source. For the first costly to transport than traditional Net Zero, although the pace with
half of the previous century, coal hydrocarbons causing energy markets which the share of renewables
provided most of the world’s energy. to become more localized. grows is even faster.

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Total greenhouse gases

Global GDP
Climate impacts on GDP growth
Energy demand
Impact of Covid-19
Energy access and economic development

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Global backdrop
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Carbon emissions from energy use are the largest

source of greenhouse gas emissions
Global GHG emissions Carbon emissions from energy use, 2018
Gt of CO2e

60 Agriculture,
2% Buildings
and Industry
50 cooling,
Non-energy Other transport, 14%
emissions Medium and
heavy road, 5%
40 Marine, 2% Other residential
to abate
and commercial
buildings, 21%
Aviation, 3%

Energy 2018 total:

30 emissions* 33.9 Gt of CO 2
Fugitive emissions
20 Land-use change Light industry, 24%
Iron and steel,
& forestry
Waste 4%

10 Industrial processes Other heavy industry,

0 Energy
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014 2016
 ource: WRI estimates
*Energy Outlook definition which includes CO2 emissions from the combustion of fossil fuels.
Non-CO2 emissions from energy as defined by WRI are allocated to Industrial processes and Fugitive emissions

Key points

Scientific evidence suggests that the were 32.9 Gt CO2e, similar to the WRI or processes which are relatively
dominant cause of climate change estimate of 32.3 Gt CO2e. straightforward or inexpensive to
is the release of greenhouse gases electrify can be reduced as the power
(GHGs). The World Resources In addition to carbon emissions from sector is increasingly decarbonized.
Institute (WRI) estimates that total energy use, the WRI estimates that One exception to this is seasonal
GHGs were equal to 49.4 Gt CO2e the other main sources of emissions space heating and cooling demands
in 2016, with carbon emissions from in 2016 were: agriculture (5.8 Gt in buildings. Although these demands
energy use being the largest source CO2e); industrial processes (2.8 can be electrified, the scale of the
of GHGs, accounting for around 65% Gt CO2e); land-use and forestry seasonal fluctuations are hard to meet
of all GHGs. change 3.2 Gt CO2e); and waste in a power sector based heavily on
management facilities (1.6 Gt CO2e). intermittent renewable power (see pp
The estimate of carbon emissions 124-125).
from energy used in the Energy In terms of the carbon emissions
Outlook differs slightly from the WRI from energy use, nearly half of the The majority of emissions which are
definition. The Energy Outlook does emissions stem from energy used hard-to-abate stem from activities or
not model fugitive methane emissions within industry. The remainder is split processes that are difficult to electrify
from the production of hydrocarbons roughly evenly between the transport and so need alternative sources of
and so they are excluded from the and buildings (including agriculture) low-carbon energy. This includes high
estimates used. The Outlook does, sectors. temperature industrial processes,
however, include emissions from such as those used in iron and
bunker fuels which are excluded As the energy transition advances, steel, cement and chemicals. It also
from the WRI definition. Based on some emissions can be more readily includes long-distance transportation
the Energy Outlook definition, carbon prevented than others. In particular, services, including heavy duty trucks,
emissions from energy use in 2016 carbon emissions from activities aviation and marine.

21 | bp Energy Outlook: 2020 edition

Global backdrop
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Global GDP continues to expand, but at a slower rate

Global GDP growth and
Global GDP, 2018-2050 regional contributions
Trillion $US (2015) PPP % per annum

350 3.0%
GDP per head Africa
2.5% Developed
Other Asia
2.0% India

200 China
World population 1.5%
150 Other
1.0% urbanizing
100 countries

50 0.5%

0 0%
2018 2050 2018 - 2050

Key points

The world economy continues to The expansion in global activity is The growth in global activity
grow over the next 30 years, driven supported by population growth, and prosperity is underpinned
by increasing wealth and living with the world’s population by continuing high levels of
standards in the developing world, increasing by over 2 billion people to urbanization, which is often an
but at a slower rate than in the past. around 9.6 billion by 2050. integral part of the development
process leading to increasing levels
Global GDP annual growth But the most important factor of industrialization and productivity.
averages around 2.6% (on a 2015 underpinning global growth is Countries which are projected
Purchasing Power Parity basis) in increasing productivity (GDP per to have a relatively fast pace of
all three scenarios. This growth is head) – and hence prosperity urbanization over the next 30 years
considerably slower than its average (income per head) – which drives – that is, the level of urbanization is
over the past 20-years, in part around 80% of the expansion in projected to increase by at least a
reflecting the persistent impact of global GDP over the Outlook. third by 2050 – contribute well over
Covid-19 on economic activity. See half of the increase in world output
pp 28-29 for a discussion of the Developing economies account over the Outlook, despite making
treatment of Covid-19 in this year’s for over 80% of the growth in the up less than a third of global GDP in
Energy Outlook. world economy, with China and 2018.
India contributing around half of that
The weaker economic growth than increase.
in the past also reflects the assumed
increasing impact of climate change
on the productive potential of the
economy (see pp 24-25, 148-149 for
a discussion of this impact).

23 | bp Energy Outlook: 2020 edition

Global backdrop
24 |

The impact from climate change on economic growth

increases over the Outlook
Climate change impact on level of GDP in 2050

Other CIS
United States
Middle East China
India OECD Asia

Other Asia

South & Central

-11% -7% -3% 0% 2%
% change in GDP by 2050

Change in GDP per head relative to

projection using average temperatures
that are kept constant at the current level

Key points

The growing concentration of is based considers only increasing Importantly, if the scenarios were
greenhouse gases in all three temperatures. extrapolated beyond 2050, the
scenarios is assumed to have an erosion of wealth and prosperity in
increasing impact on the growth and For illustrative purposes, the level of BAU would get progressively worse,
productive potential of the global GDP in 2050 in all three scenarios leading to significantly lower levels
economy. is projected to be around 5% of activity and well-being than in
lower relative to a hypothetical Rapid or Net Zero.
Increasing temperatures, combined world in which the concentration
with more extreme weather of greenhouse gases was frozen The environment and economic
patterns and rising sea levels, may at current levels. These effects are models and studies underpinning
trigger a range of impacts that lower assumed to be greatest in regions these illustrative estimates of
economic growth. Efforts to reduce which have the highest average the impact of global warming
or mitigate carbon emissions may temperatures currently on economic activity are highly
also divert investment from other (see pp 148-149). uncertain and almost certainly
sources of growth. incomplete – for example, they do
The negative impact from rising not capture many of the potential
Estimating the potential size of temperature levels is largest in BAU human costs. Future editions of the
these impacts is highly uncertain, where little progress is made in Energy Outlook will update these
with most existing environmental reducing carbon emissions. But the estimates as the scientific and
and economic models and studies upfront costs of the policy actions economic understanding of these
capturing only a subset of these taken to reduce emissions are effects improves.
effects, often very imperfectly. For greater in Rapid and Net Zero, such
instance, the economic literature on that the overall impact on GDP over
which our illustrative impact on GDP the next 30 years is projected to be
broadly similar in all three scenarios.

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Global backdrop
26 |

Energy demand grows led by increasing prosperity,

partially offset by efficiency gains
Contribution to primary energy
demand growth Global primary energy demand
% per annum EJ

4% 800
GDP per
head Rapid
3% Business- Population 700 Net Zero
Rapid Net Zero as-usual Business-as-usual
intensity 600
energy 500


-2% 100

-3% 0
1995-2018 2018-2050 1990 2000 2010 2020 2030 2040 2050

Key points

Growth in global energy demand is Energy efficiency measured in terms The faster declines in energy
underpinned by increasing levels of of final energy use improves by intensity relative to history in Rapid
prosperity in emerging economies. more in Net Zero than Rapid, but and Net Zero are a critical factor
Primary energy increases by around these gains are offset in terms of in mitigating the growth in carbon
10% in Rapid and Net Zero and primary energy by the greater use emissions. Other things being equal,
around 25% in BAU. of electricity and hydrogen which if energy intensity over the Outlook
require considerable amounts of improved at the same rate as the
Much of this increase in energy primary energy to produce. past 20 years, carbon emissions by
consumption – the entire growth in 2050 would be more than a quarter
Rapid and Net Zero and over half in Growth of primary energy in BAU higher in Rapid and Net Zero.
BAU – stems from economies which (0.7% p.a.) is faster and more
are urbanizing quickly. sustained than in the other two Policies and actions to promote
scenarios, reflecting slower gains in improvements in energy efficiency
The average rates of growth of energy efficiency. are central to achieving a low-carbon
primary energy in Rapid (0.3% transition.
p.a.) and Net Zero (0.3% p.a.) are
significantly slower than the past
20 years (2.0% p.a.), reflecting a
combination of weaker economic
growth and faster improvements in
energy intensity (energy used per
unit of GDP). Primary energy in both
scenarios broadly plateaus in the
second half of the Outlook.

27 | bp Energy Outlook: 2020 edition

Global backdrop
28 |

Covid-19 is assumed to have a persistent impact

on economic activity and energy demand
Impact of Covid-19 in Rapid Alternative case: Greater impact from Covid-19
% change as a result of Covid-19

Primary energy
-2% Oil demand

-4% -3 Mb/d
-2 Mb/d
-5 Mb/d



-5 Mb/d
2025 2050 2025 2050

Key points

The Covid-19 pandemic is foremost Africa, whose economic structures which is around 3 Mb/d lower in
a humanitarian crisis, but the scale are most exposed to the economic 2025 and 2 Mb/d in 2050 as a result
of the economic cost and disruption ramifications of Covid-19. of the pandemic. The majority of
is also likely to have a significant this reduction reflects the weaker
and persistent impact on the global The pandemic may also lead to a economic environment, with around
economy and energy system. At number of behavioural changes; 1 Mb/d of the reduction in 2025 a
the time of writing, the number of for example, if people choose to result of the various behavioural
new cases from the pandemic is travel less, switch from using public changes. The marginal impacts in
still increasing and so assessing its transport to other modes of travel, BAU and Net Zero are similar.
eventual impact is highly uncertain. or work from home more frequently.
Many of these behavioural changes There is a risk that the economic
The central view used in the main are likely to dissipate over time as losses from Covid-19 may be
scenarios it that economic activity the pandemic is brought under significantly bigger, especially if
partially recovers from the impact control and public confidence is there are further waves of infection.
of the pandemic over the next few restored. But some changes, such This possibility is explored in a
years as restrictions are eased, as increased working from home, ‘greater impact’ case, in which
but that some effects persist. The may persist. Covid-19 reduces the level of global
level of global GDP is assumed to GDP by 4% in 2025 and almost 10%
be around 2.5% lower in 2025 and In Rapid, the impact of the pandemic by 2050. In this ‘greater impact’
3.5% in 2050 as a result of the is assumed to reduce the level of case, the crisis causes the level of
crisis. These economic impacts energy demand by around 2.5% in energy demand in Rapid in 2050 to
disproportionately affect emerging 2025 and 3% in 2050. The impacts be 8% lower, with the level of oil
economies, such as India, Brazil and are most pronounced on oil demand, demand around 5 Mb/d lower.

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Global backdrop
30 |

Economic development depends on both access

to energy and the quality of that access
GDP and electricity consumption Proportion of world population with
(per head), 2018 Tier 3* access to electricity or less
The size of the bubbles are proportional to population

80 50%
Countries by
Tier 1 & 2

income group
Tier 3

Tier 4

Tier 5

Low income
60 Lower middle
GDP per head (PPP ($'000))

Upper middle
income 30%
High income Net Zero as-usual
40 Rapid

Population (million) 20%


0 0%
0 2500 5000 7500 10000 2018 2050
Annual electricity consumption per head (kWh)
Source: Oxford Economics; BP Statistical Review 2019 *Tier 3 access assumes less than 16 hours of uninterrupted medium
Tiers based on World Bank definitions power electricity during the day and less than 4 hours during the evening

Key points

There is a strong link between The World Bank’s multi-tiered Although the share of the world’s
access to energy and economic framework provides one measure population without any access to
well-being and prosperity. The of quality of access, in which Tier 1 electricity is estimated to have
importance of energy access is access equates to very basic levels declined to 10% in 2018, around
embodied in the UN’s Sustainable of provision (lighting with limited 45% of the world’s population lived
Development Goal (SDG) 7 availability) though to Tier 5, which in countries with Tier 3 access or
which seeks to “ensure access to denotes access to plentiful and below. In all three scenarios, around
affordable, reliable, sustainable and reliable supplies. a quarter of the world’s population
modern energy for all”. in 2050 live in countries or regions
There is a strong link between in which average levels of electricity
One measure monitored by SDG economic development and the consumption are still equivalent to
7 is global access to electricity, quality of the access to electricity: Tier 3 access or below.
where the number of people around three-quarters of low and
without access is estimated to have lower-middle income countries in Improving the quality of electricity
decreased from 1.2 billion in 2010 to 2018 had relatively limited access to access – and energy access more
790 million in 2018*. electricity (Tier 3 or below); whereas generally – across the globe is
over 90% of high-income countries likely to require a range of different
Economic prosperity and had Tier 5 access. policy approaches and technologies,
development depend not just on the including the development of
ability to access electricity, but also decentralized and off-grid power
on the quantity and quality of the generation.
electricity provision.

* Source: Tracking SDG7

The Energy Progress Report 2020
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32 |

Energy use
by sector


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34 |

Energy consumption grows across all sectors of the economy,

although slower than in the past
Primary energy consumption by end-use sector Annual demand growth and sector contributions
EJ % per annum

800 2.0%
Business- Transport
700 Industry
Rapid Net Zero 1.5%
400 as-usual

Rapid Net Zero


0 -0.5%
2018 2050 1990-2018 2018-2050

Key points

The strength and composition of amounts of primary energy to The use of electricity and hydrogen
energy growth over the next 30 produce. As such, increasing the use expand by even more in Net Zero,
years depends importantly on how of these forms of energy carriers particularly in transport and industry.
that energy is used across the main tends to boost primary energy. As a result, even though the pace
sectors of the economy. of underlying efficiency gains in
In Rapid, the growth in primary both sectors is faster than in Rapid,
The industrial sector (excluding energy used in all three sectors the increase in primary energy is
the non-combusted use of fuels) slows relative to the past 20 somewhat greater. Primary energy
consumed around 45% of global years. This deceleration is most used in buildings by 2050 is largely
energy in 2018, with the non- pronounced in the industrial and unchanged from its current level.
combusted use of fuels accounting buildings sectors, with the use of
for an additional 5% or so. The primary energy in both sectors falling In contrast, the use of primary
remainder was used within in the second half of the Outlook. energy increases materially in
residential and commercial buildings In contrast, primary energy used all three sectors in BAU, albeit
(29%) and transport (21%). in transport increases throughout significantly slower than in the past
the Outlook – accounting for nearly 20 years. This deceleration is most
The outlook for primary energy 60% of the total increase in primary marked in industry and transport,
also depends on the form in which energy in Rapid – boosted by with energy use in buildings
that energy is used at the final greater switching to electricity and and the non-combusted sector
point of consumption. In particular, hydrogen. This hydrogen can be together accounting for around half
although it is possible to decarbonize used either directly or combined of the increase in primary energy
the production of electricity and with carbon or nitrogen to make it consumption.
hydrogen, they require considerable easier to transport.

35 | bp Energy Outlook: 2020 edition

36 |

The use of energy within industry shifts towards developing

economies and lower-carbon energy
Growth of final energy consumption
Primary energy demand in industry in industry by energy carrier
EJ % per annum

350 2.0%
Developed Biomass
+ China
300 as-usual Emerging 1.5% Hydrogen
(ex. China) Net Zero
Net Zero Business- Electricity
Rapid 1.0%
250 Rapid as-usual
0% Liquids
150 Total


50 -1.5%

0 -2.0%
2018 2050 1990 - 2018 2018-2050

Key points

Industrial energy demand in both by the increasing use of electricity The use of coal within industry falls
Rapid and Net Zero is relatively and hydrogen, especially in Net sharply in all three scenarios. In BAU,
flat over the Outlook, dampened Zero, which boosts the demand for the increased demand for energy
by increasing efficiency gains the primary energy used in their is more than met by the growing
in industrial processes and an production. use of gas and electricity, with coal
expansion of the circular economy. consumption falling by around a
Industrial demand in BAU increases The growth of industrial energy third. The demise of coal use in
by around 15% (0.5% p.a.) by 2050, demand in all three scenarios is industry is much more pronounced
which is significantly slower growth concentrated in the emerging world in Rapid and Net Zero where it is
than the past 20 years. (outside of China) – especially, India, almost entirely eliminated in both
Other Asia and Africa – as energy- scenarios by 2050, replaced by
The increasing role of the circular and labour-intensive industrial an increasing share of electricity,
economy in Rapid and Net Zero activities are increasingly relocated biomass and hydrogen. The shift
limits the growth in industrial output, from the developed world and China towards low-carbon energy sources
as materials such as steel, aluminium to lower-cost economies. is most pronounced in Net Zero,
and plastics are used less and are such that the use of gas (and oil)
increasing reused and recycled. also falls substantially by 2050. In
Combined with increasingly efficient contrast, the use of gas in industry in
industrial processes, energy used Rapid is broadly unchanged over the
at the final point of consumption in Outlook.
the industrial sector falls by around
15% by 2050 in Rapid and by 25%
in Net Zero. These falls are offset

37 | bp Energy Outlook: 2020 edition

38 |

The non-combusted use of fuels continues to grow,

but at much reduced rates
Non-combusted demand by fuel Oil feedstock for plastics and fibres
EJ Mb/d

60 20
Rapid Net Zero Business- Coal Rapid
as-usual Net Zero
50 Business-as-usual
Extrapolation of past trends

30 10


0 0
2018 2035 2050 2018 2035 2050 2018 2035 2050 2018 2025 2030 2035 2040 2045 2050

Key points

The non-combusted use of fuels These actions are greatly intensified Oil accounts for almost two-thirds of
– predominantly as feedstocks in Rapid and Net Zero, with the growth in non-combusted fuels
for petrochemicals, bitumen and increased use of chemical recycling out to 2050 in BAU and around half
fertilizers – is an important source of and a focus on reducing the demand in Rapid, driven in large part by the
incremental demand for fossil fuels, for some products and increasing production of plastics and fibres. The
although less than in the past 20 the reuse of others. As a result, the actions to reduce, reuse and recycle
years as environmental pressures growth of non-combusted fuels plastics means that the level of oil
increase. in Rapid (0.5% p.a.) is half that of used in the production of plastics by
BAU, with use gradually declining in 2050 is around 3 Mb/d lower in BAU
The non-combusted use of fuels the 2040s. In Net Zero, the use of and 6 Mb/d in Rapid relative to an
(oil, natural gas and coal) grows at non-combusted fuels peaks around extrapolation of past trends linked to
an average rate of 1.1% p.a. in BAU, 10-years earlier and by 2050 is the growth in economic activity and
less than half the rate seen over around 25% below current levels. prosperity. These trends are even
the past 20 years (2.7% p.a.). This more pronounced in Net Zero, with
deceleration largely reflects actions oil demand by 2050 2 Mb/d below
to both increase the level of recycling current levels and 10 Mb/d below an
– recycling rates roughly double from extrapolation of past trends.
current levels to around one third by
2050 – and encourage a shift away
from the use of some manufactured
products, such as single-use plastics
and fertilizers.

39 | bp Energy Outlook: 2020 edition

40 |

Improving living standards in the developing world

drive increasing use of electricity in buildings
Growth of final energy consumption
Primary energy demand in buildings in buildings by energy carrier
EJ % per annum

250 Business- 2.0%

as-usual Emerging Other

Developed 1.5% Business- Hydrogen

Net Zero as-usual
200 Electricity
Rapid 1.0% Rapid
Net Zero
150 Natural gas

0% Oil

100 Total


0 -2.0%
2018 2050 1995-2018 2018-2050

Key points

The growth of energy absorbed The efficiency gains are less The increasing use of electricity
by the buildings sector emanates pronounced in BAU, with energy crowds out the demand for oil, gas
entirely from the developing world, consumed in the buildings sector and coal which lose share in all three
as improving wealth and living growing by almost 40% (1.0% p.a.) scenarios. The shift away from
standards allow people to live and by 2050, accounting for around 40% these traditional energies is most
work in greater comfort. of the overall increase in primary pronounced in Rapid and Net Zero,
energy. in which the use of oil in buildings is
In Rapid and Net Zero, a significant largely phased out by 2050, and the
expansion of energy use in buildings Electricity consumption increases demand for gas in buildings falls by
in developing Asia and Africa – materially in all three scenarios, around 50% in Rapid and over 90%
which enjoy some of the most driven by the greater use of lighting in Net Zero.
significant increases in prosperity – and electrical appliances (including
is broadly offset by substantial falls for space cooling) as living standards
in the developed world as efficiency increase.
in new and existing buildings stock
improves, driven by regulations,
carbon prices and consumer
preferences. As a result, overall
energy use in buildings is relatively
little changed over the Outlook in
both Rapid (0.2% p.a.) and Net Zero
(0.1% p.a.).

41 | bp Energy Outlook: 2020 edition

42 |

The growth of energy used in transportation slows,

with oil peaking in mid-to-late 2020s
Share of final energy consumption
Primary energy demand in transport in transport by energy carrier
180 Rapid Net Zero as-usual
Emerging 100%
Net Zero
160 Business- Developed Electricity
Rapid as-usual
80% Gas
120 Oil



0 0%
2018 2050 2018 2050

Key points

The demand for passenger and 25% and 35% respectively by The use of oil in transport peaks in
commercial transportation increases 2050. Primary energy in transport the mid-to-late 2020s in all three
strongly over the Outlook, with road increases by almost 25% in scenarios: the demand for oil for
and air travel doubling in all three BAU, with slower gains in energy road transport in emerging markets
scenarios. The growth in final energy efficiency offset by a smaller shift continues to increase until the early
required to fuel this increased away from oil. 2030s in Rapid and Net Zero, and
travel is offset by significant gains the late 2030s in BAU, but this is
in vehicle efficiency, especially in The growth in primary energy used increasingly offset by falls in the
passenger cars, trucks and aviation. in transport in all three scenarios developed world.
stems entirely from the developing
The gains in energy efficiency are world, as increasing prosperity The share of oil in total final
partially disguised by a shift away in developing Asia, Africa and consumption falls from over 90% of
from oil towards the increasing Latin America supports greater transport demand in 2018 to around
use of electricity and hydrogen demand for passenger and freight 80% by 2050 in BAU, 40% in Rapid
in transport. In particular, the transportation. Energy use in and just 20% in Net Zero. The main
conversion process used to produce transport in the developed world is counterpart is the increasing use of
these energy carriers boosts the broadly flat. electricity, especially in passenger
total amount of primary energy cars and light and medium-duty
absorbed by the transport sector. trucks, along with hydrogen, biofuels
The shift towards electricity and and gas. The share of electricity
hydrogen is most pronounced in in end energy use in transport
Rapid and Net Zero, where overall increases to between 30% and 40%
primary energy increases by around by 2050 in Rapid and Net Zero.

43 | bp Energy Outlook: 2020 edition

44 |

Energy use in road transport is dominated by

electrification and vehicle efficiency
Share of car and truck vehicle Factors impacting passenger
kilometres electrified* car liquid fuels demand

100% 40
Rapid and switch to
Net Zero 30 other non-liquid fuels
Business-as-usual ICE car
20 fuel efficiency
Increase in
10 passenger
car VKM
0 Change in
50% liquid fuels
-10 demand



0% -50
2020 2025 2030 2035 2040 2045 2050 Rapid Net Zero Business-
*includes buses

Key points

The outlook for energy use in road By 2050, electric vehicles account Despite the accelerated
transport is dominated by two major for between 80-85% of the stock electrification of passenger cars,
trends: increasing electrification and of passenger cars in Rapid and the continuing importance of ICE
improving vehicle efficiency. Net Zero and 35% in BAU. The passenger cars for much of the
corresponding numbers for light and Outlook means that improvements
The electrification of the vehicle medium-duty trucks are 70-80% in their efficiency is the main factor
parc is most pronounced in Rapid and 20%. limiting the growth of oil used in
and Net Zero, concentrated in two passenger cars out to 2050.
and three wheelers, passenger cars The other dominant trend affecting
and light and medium-duty trucks. the use of energy in road transport Vehicle efficiency improvements in
Electric vehicles in Rapid and Net is the increasing levels of vehicle Rapid reduce oil use in passenger
Zero account for around 30% of efficiency, especially passenger cars (and hence carbon emissions)
four-wheeled vehicle kilometres cars, driven by tightening vehicle by roughly twice as much as
(VKM) travelled on roads in 2035 emission standards and rising electrification in 2050.
and between 70-80% in 2050, carbon prices which are largely
compared with less than 1% in borne by consumers in the form of
2018. The corresponding shares in higher gasoline and diesel prices. In
BAU are a little over 10% in 2035 Rapid, the efficiency of a typical new
and around 30% in 2050. internal combustion engine (ICE)
passenger car increases by around
45% over the next 15 years.

45 | bp Energy Outlook: 2020 edition

46 |

The pattern of road transportation changes led by

increasing prosperity and growth of robotaxis
Change in share of road passenger VKM, Robotaxi share of passenger car VKM
2020-2050 powered by electricity

25% 60%
20% Human taxi Rapid
Own car 50% Net Zero
Light duty truck 40%
5% 2/3 wheelers
0% 30%



-25% 0%
Rapid Net Zero Business- 2020 2025 2030 2035 2040 2045 2050

Key points

The composition of road factors, including continuing advances use – up to 9-times greater than
transportation across different in digital technologies such as private cars by 2050. The growing
modes of transport, e.g. private cars, improving connectivity and geospatial penetration of robotaxis, combined
taxis, buses etc, is affected by two technologies. In addition, digital with their intensity of use, means
significant trends over the Outlook: advances enable automated driving that by 2035 they account for around
increasing levels of prosperity and systems and the emergence of fully 40% of passenger VKM powered
the falling cost of shared-mobility autonomous vehicles (AVs) from the by electricity in Rapid and Net Zero
transport services. Both trends have early 2030s in Rapid and Net Zero, and around 20% in BAU. This share
important implications for the pace significantly reducing the cost of declines in the final 10-years or so
and extent to which the transport shared-mobility services, especially in of the Outlook in Rapid and Net Zero
sector is decarbonized. developed economies where average as the share of private ownership of
income levels are higher. The falling electric cars increases.
The increasing levels of prosperity relative cost of autonomous shared-
and living standards in emerging mobility services (robotaxis) leads The potential for robotaxis to help
economies leads to a shift away to a shift away from private-owned decarbonize road transportation by
from high-occupancy forms of vehicles as well as buses. increasing the share of passenger car
transport (e.g. buses) into passenger VKM powered by electricity means
cars. This leads to a reduction in The vast majority of robotaxis are they are supported by government
average load factors (i.e. average electric in all three scenarios. This policies, such as higher road pricing
number of passengers per vehicle), reflects the local air quality benefits and congestion charges for private
putting upward pressure on carbon and lower running costs of electric vehicles, particularly in Rapid and Net
emissions. cars relative to traditional (internal Zero. The importance of robotaxis is
combustion engine). Electric also supported in Net Zero by a shift
The relative cost of shared mobility robotaxis provide a significant cost in societal attitudes towards a sharing
services falls as a result of a range of advantage given the intensity of economy.

47 | bp Energy Outlook: 2020 edition

48 |

Biofuels and hydrogen play a key role in decarbonizing

aviation and marine
Total final energy demand in transport by mode Aviation and marine demand by source
140 20 BAU
Business- Trucks Biofuels
Passenger vehicle 15 Net Zero Oil
Marine 10
100 Rapid
Net Zero 5
2018 2050
60 Marine
15 BAU Hydrogen
10 Gas
Net Zero
20 Biofuels
0 0
2018 2050 2018 2050

Key points

Aviation and marine transport In Rapid, liquids demand from and to nearly 60% in Net Zero. In
accounted for around 7 Mb/d and aviation remains relatively stable at contrast, there is minimal growth in
5 Mb/d of oil consumption in 2018 around 7 Mb/d over the course of the share of biofuels in BAU.
respectively. Demand for these the Outlook, as efficiency improves
services increases over the Outlook by around 35%, largely offsetting Unlike aviation, the fuel mix in the
in both Rapid and BAU: growth additional demand for air travel. In shipping sector is able to diversify
in shipping is driven by increased Net Zero, these efficiency savings into hydrogen (either as ammonia
levels of trade; whilst expansion in plus reduced appetite for flying or in liquid form) and LNG, as well
air-travel is underpinned by growing in some markets means liquids as biofuels. In Rapid and Net Zero,
prosperity, especially in emerging demand from aviation peaks in non-fossil fuels account for 40%
economies. In Net Zero, the growth the early 2030s and declines to a and 85% of marine transport fuel by
in air travel by 2050 is around 10% little below 2018 levels by 2050. In 2050 respectively, with more than
lower than in BAU, reflecting in part contrast, liquids demand continues half of that coming from hydrogen.
a shift in societal preferences to to grow throughout the Outlook in Conversely, under BAU, marine
use high-speed rail as an alternative BAU, reaching 10 Mb/d by 2050. demand for oil increases slightly by
to air travel in China and much of 2050, with natural gas increasing
the OECD. Similarly, increasing Biofuels play a critical role in its share of the sector fuel mix to
preference for the consumption decarbonizing the aviation sector, just under 15% and non-fossil fuels
of locally-produced goods and since neither batteries nor hydrogen accounting for just 1%.
reduction in oil trade in Net Zero are able to deliver the necessary
contributes to reduced shipping energy density required for aviation.
demand by around a third by 2050 The share of biofuels in jet-fuel
relative to BAU. increases from less than 1% in 2018
to around 30% by 2050 in Rapid

49 | bp Energy Outlook: 2020 edition

50 |


Regional energy demand and carbon emissions
Fuel mix across key countries and regions
Global energy trade and energy imbalances
Alternative scenario: Deglobalization

51 | bp Energy Outlook: 2020 edition

52 |

Growth in global energy demand comes

entirely from emerging economies
Primary energy growth
Primary energy consumption by region and regional contributions
EJ % per annum

800 2.5%
Business- Other
700 Africa
Rapid Net Zero Other Asia 2.0%
600 India
China 1.5%
400 Total 1.0% Business-

300 Rapid Net Zero


0 -0.5%
2018 2050 2000-2018 2018-2050

Key points

Growth in global energy demand Growth of energy consumption in for energy in all three scenarios,
in all three scenarios is driven the emerging economies is led by accounting for over 20% of the
entirely by emerging economies, India and Other Asia, which together world’s energy demand in 2050,
underpinned by increasing account for more than the entire almost twice that of India.
prosperity and improving access increase in primary energy in Rapid
to energy. Energy consumption and Net Zero and almost 60% in Africa’s contribution to demand
in the developed world falls as BAU. India is the largest source of growth increases in the second
improvements in energy efficiency demand growth out to 2050 in all half of the Outlook, supported by
outweigh demands from higher three scenarios. a growing population and rising
levels of activity. prosperity. Even so, Africa’s energy
Growth in China’s energy demand consumption remains small relative
The contrasting energy trends slows sharply relative to past trends, to its size: although around a quarter
in developed and emerging reaching a peak in the early 2030s in of the world’s population are
economies lead to a continuing shift all three scenarios. Indeed, China’s projected to live in Africa in 2050,
in the centre of gravity of energy energy demand in Rapid and Net it accounts for less than 10% of
consumption, with the emerging Zero by 2050 is back close to 2018 total energy demand in all three
world accounting for around 70% of levels, helped by accelerating scenarios.
energy demand by 2050 in all three gains in energy efficiency and a
scenarios, up from around 50% as continuing shift in the structure of
recently as 2008. the economy away from energy-
intensive industries. Despite that,
China remains the largest market

53 | bp Energy Outlook: 2020 edition

54 |

Global differences in energy consumption and carbon emissions

narrow over the Outlook
Energy consumption per head in Rapid Carbon emissions per head in Rapid
GJ per head Tonnes of CO2 per head

300 16
Rapid Rapid
Emerging 14

150 India 8


0 0
2018 2050 2018 2050

Key points

A key factor underlying the The degree of this inequality These differences in the current
contrasting trends in energy narrows over the Outlook, reflecting levels of energy consumption
demand in developed and emerging both the sustained increases in between developed and emerging
economies are the significant economic activity and prosperity in economies are also reflected in
differences in the level of energy the emerging world and the marked average carbon emissions per
consumption per capita. falls in energy consumption per capita, offset only partially by the
capita in developed economies: lower average carbon intensity of
In 2018, average energy US energy consumption per capita the fuel mix in the developed world
consumption per capita in the falls by 40% over the Outlook in relative to emerging economies.
developed world was more than Rapid. Even so, by 2050, average
three times that in emerging energy consumption per capita in The differential in carbon emissions
economies, with an average person the developed world in Rapid is still per capita narrows markedly by
in the US consuming 12 times more more than twice that in emerging the end of the Outlook in Rapid.
energy than an average person in economies. Similar convergence in This is almost entirely driven by the
India. energy consumption per head is also narrowing in energy consumption
apparent in Net Zero and BAU. per capita, with the degree of
These differences in energy improvement in the average carbon
consumption largely reflect intensity of the fuel mix broadly
differences in economic similar in developed and emerging
development and prosperity, as well economies.
as a range of other factors, including
economic structure, local climatic
conditions and differences in natural
resource endowments.

55 | bp Energy Outlook: 2020 edition

56 |

The low-carbon transition leads to a gradual convergence

in the fuel mix across countries
Shares of energy sources

2018 Rapid, 2050

Oil Oil 60%
China 40% China
India India

Renewables 60% 40% 20% 0% Natural Renewables 0% Natural

gas gas

Coal Coal

Key points

As well as differences in the significantly smaller shares. This supported by higher carbon prices
pattern of energy demand growth contrasts with China and India, and other policies. This shift is also
across developing and emerging where coal currently accounts for reflected in a move away from the
economies, the nature of the energy between 55-60% of primary energy. use of coal, which is substantially
transition also depends on variations reduced in China and India in Rapid
in the fuel mix in different parts of The transition to a lower-carbon by 2050, and entirely phased-out in
the world. energy system in Rapid is driven by the US and EU.
several common trends which lead
There are marked differences in to a gradual convergence in the fuel These trends also help drive a
the current mix of energy used mix across all four countries. convergence in the role of natural
across countries and regions, as gas, with its share declining in US
illustrated, for example, by the Most significant is the growing and EU, and increasing in China and
varying importance of different competitiveness of renewable India, such that by 2050 it accounts
energy sources in US, EU, China energy, which combined with its for between 15-25% of energy in all
and India. These differences reflect widespread availability and the four countries.
numerous factors including the increasing electrification of the
level of economic development and energy system, leads renewable A similar degree of convergence is
the cost and availability of different energy to be the single largest also apparent in Net Zero. Although
energy sources. energy source in all four countries in the same qualitative trends are
Rapid by 2050, providing between apparent in BAU, the more limited
The current fuel mix in the US 45-55% of energy supplies. progress made in phasing out
and EU have some similarities, coal use in China and India means
with oil and gas accounting for the The growth in renewables (including the degree of convergence is
majority of energy supplies, and bioenergy) is part of a broader trend considerably less.
coal and renewable energy having towards a lower carbon fuel mix,

57 | bp Energy Outlook: 2020 edition

58 |

Significant energy imbalances persist over the Outlook

Net import and exports of oil and gas by region in Rapid


50 Russia
41 2018 2050

2018 2050

2050 Middle China -20
2018 2050 East -23
-8 India
2018 2018 2050


Natural gas


Key points

The global energy system is These oil and gas deficits in China domestic consumption, means the
highly interconnected, with huge and India persist in Rapid, although US becomes a sizeable net exporter
international flows of traded energy. to varying degrees. China’s of oil and especially gas in Rapid.
In 2018, almost three-quarters of combined net imports of oil and gas US exports of oil and gas peak in
global oil production was traded decline slightly by 2050, helped by the 2030s before gradually declining
internationally and around a quarter a 50% fall in Chinese oil demand as production of US tight oil and
of natural gas. (see pp 66-67). In contrast, India’s unconventional NGLs falls back (see
combined oil and gas imports more pp 70-71).
These trade flows are associated than double by 2050, driven in part
with large energy imbalances by increased coal-to-gas switching The disruptions associated with
(surpluses and deficits) as countries which leads to a marked deepening Covid-19, together with the increase
with large resource endowments in India’s dependence on imported in trade disputes and sanctions in
export energy to countries with less LNG. recent years, may lead to rising
natural energy resources. concerns about energy security,
On the other side of the trade particularly in countries which are
For example, in 2018, China balance, exports of oil and gas highly dependent on energy imports.
imported around 70% of the oil it over the Outlook continue to be
consumed and a little over 40% of dominated by the Middle East and The potential impact of a shift
its natural gas. The corresponding Russia. towards deglobalization and
numbers for India were a little above increased concerns about energy
80% and 50%. The expansion in US oil and gas security on the global energy system
production associated with the shale is explored on the next page.
revolution, together with falling

59 | bp Energy Outlook: 2020 edition

60 |

Alternative scenario: Deglobalization

Covid-19 may lead to deglobalization and increased
concerns about energy security
Deglobalization versus Rapid :
Global GDP and energy in 2050 Net exports of oil and gas in 2050

0% 25
Natural gas Deglobalization
Coal 20 Rapid
Oil 15
-2% 10


-5% -10


-7% -25
GDP Primary US Russia China India

Key points

The disruptions associated with increased concerns about energy The risk premia on imported energy
Covid-19 may lead to a process of security lead countries to attach means that the fall in energy is
deglobalization, as countries seek to a small risk premium (10%) on concentrated in traded fuels,
increase their resilience by becoming imported sources of energy. especially in oil and natural gas
less dependent on imported goods given the relatively low level of coal
and services, and companies The slower trend GDP growth consumption remaining towards the
reshore certain activities and move results in the level of world GDP end of the Outlook in Rapid. These
supply chains closer to home. One by 2050 being 6% lower in falls lead to a pronounced narrowing
manifestation of these trends is that Deglobalization than in Rapid and in energy deficits and surpluses
concerns about energy security may energy demand around 5% lower, around the world. For example,
increase, particularly in countries with those falls concentrated in China’s net imports of oil and gas in
which are highly dependent on countries and regions most exposed Deglobalization are 30% lower than
energy imports. to reduced foreign trade. in Rapid by 2050. Likewise, US net
exports of oil and gas are around
The impact of these possible 50% lower by 2050.
changes on Rapid is explored in an
alternative Deglobalization case in The fall in traded fossil fuels relative
which: to domestically produced energy,
especially renewable energy,
the reduced openness of the means that the carbon-intensity
global economy is assumed to of the global fuel mix by 2050 is
lead to a slight reduction (0.2 slightly lower in Deglobalization
percentage points) in trend global than in Rapid.
GDP growth; and

61 | bp Energy Outlook: 2020 edition

62 |

Demand and supply

of energy sources

Oil and liquid fuels
Renewable energy in power
Nuclear power

63 | bp Energy Outlook: 2020 edition

64 |

Renewables lead the transition to a lower-carbon energy mix

Shares of primary energy Primary energy consumption by source


Renewables Hydrocarbons
100% 800
Business- Renewables
Rapid as-usual
Net Zero Hydro
Business-as-usual Net
80% Rapid Zero Nuclear
600 Coal
Natural gas
60% Oil



0% 0
2018 2025 2030 2035 2040 2045 2050 2018 2025 2030 2035 2040 2045 2050 2018 2050

Key points

The growth in primary energy The increasing importance of The level of oil demand in both
over the Outlook is dominated by renewable energy comes at the Rapid and Net Zero does not fully
renewable energy, as the world expense of hydrocarbons whose recover from the sharp drop caused
shifts towards lower-carbon energy share of primary energy declines by Covid-19, with demand falling by
sources. from close to 85% in 2018 to around around 50% by 2050 in Rapid and
40% by 2050 in Rapid and 20% in almost 80% in Net Zero. The outlook
Renewable energy – including wind, Net Zero. for oil is more resilient in BAU, with
solar, geothermal and bioenergy but demand in 2050 declining slightly
excluding hydroelectricity (see pp Within hydrocarbons, natural gas from its current level (pp 66-67).
84-87) – increases more than 10-fold has the most durable outlook, with
in both Rapid and Net Zero, with its its level in Rapid in 2050 broadly Coal consumption declines
share in primary energy rising from unchanged from its current level significantly in all three scenarios,
5% in 2018 to over 40% by 2050 in and around 35% higher in BAU. particularly in Rapid and Net Zero in
Rapid and almost 60% in Net Zero. Consumption of natural gas falls by which it falls by well over 80% by
Although the growth of renewables around 40% by 2050 in Net Zero 2050 (pp 88-89).
is less pronounced in BAU, they (pp 76-77).
still account for around 90% of the The way in which the pronounced
overall increase in primary energy falls in the demand for oil, natural
over the next 30 years (pp 84-85). gas and coal in Net Zero are matched
on the supply side by the countries
and regions which produce these
forms of energy is very uncertain
and not explored in detail in this

65 | bp Energy Outlook: 2020 edition

66 |

Global market for liquid fuels adjusts to changing

patterns of demand and production
Liquid fuels consumption Liquid fuels supply growth
Mb/d Mb/d, average annual growth

120 1.0
Rapid Business-as-usual
0.5 non-OPEC
US tight oil
0 Total


20 Net Zero
0 -2.5
2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2018- 2030- 2018- 2030-
2030 2050 2030 2050

Key points

The global market for liquid fuels (oil, In contrast, after recovering from the US tight oil also grows over the
biofuels and other liquids) transitions impact of Covid-19, the consumption next 10 years or so in BAU offset by
as oil demand peaks and supplies of liquid fuels in BAU is broadly flat declining OPEC production. Declines
shift. at around 100 Mb/d for the next in US tight oil and other non-OPEC
20 years, before edging lower to output from the mid-2030s onwards
The demand for liquid fuels in Rapid around 95 Mb/d by 2050. Demand provides scope for OPEC to increase
and Net Zero never fully recovers for liquid fuels continues to grow in its production despite the backdrop
from the fall caused by Covid-19, India, Other Asia and Africa, offset of gradually declining demand. By
implying that oil demand peaked in by the trend decline in consumption 2050, the level of OPEC production
2019 in both scenarios. in developed economies. in BAU is broadly unchanged from
its level in 2018.
The consumption of liquid fuels falls Despite the weakness in oil demand,
significantly over the Outlook in both US tight oil* in Rapid recovers
scenarios, declining to less than 55 from the impact of Covid-19 and
Mb/d and around 30 Mb/d in Rapid expands until the early 2030s, with
and Net Zero respectively by 2050. this increase in output more than
The falling demand is concentrated offset by falls in OPEC production.
in the developed world and China, Thereafter, OPEC production broadly
with consumption in India, Other stabilizes as declines in global
Asia and Africa broadly flat over the demand are broadly matched by
Outlook as a whole in Rapid, but falls in US tight oil and other non-
falling below 2018 levels from the OPEC supplies. By 2050, non-OPEC
mid-2030s onwards in Net Zero. supplies account for around two-
thirds of the total decline in liquids
supply in Rapid. *US tight oil include crude,
condensate and natural gas liquids
from onshore tight formations
67 | bp Energy Outlook: 2020 edition
68 |

The outlook for liquid fuels demand is dominated

by changes in the transport sector
Liquid fuels demand by sector Consumption of liquid fuels in transport
Mb/d Mb/d

120 70

100 Business- 60
as-usual Industry

Non- 50
80 combusted

Transport 40
Rapid Non-road
Net Zero Cars 20
10 Net Zero
0 0
2018 2050 2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050

Key points

The outlook for liquid fuels demand The scale and pace of these falls are Liquids fuel demand in BAU is more
is dominated by the impact of driven primarily by the changing use resilient, with broadly stable use in
Covid-19 in the near-term and by of liquid fuels in the transport sector, transport helping to support global
their declining use in the transport which declines sharply in the second demand at around 100 Mb/d for
sector further out. half of the Outlook in both Rapid and much of the next 20 years, before it
Net Zero, driven by the increasing edges lower in the final 10 years of
Global liquids demand in all three efficiency and electrification of road the Outlook as the use of liquid fuels
scenarios is significantly affected transportation (see pp 44-47). The within transport begins to decline.
by the impact of Covid-19, which transport sector accounts for around
disproportionately impacts economic two-thirds of the decline in the use The non-combusted use of liquid
activity and prosperity in emerging of liquid fuels by 2050 in Rapid and fuels, largely as a feedstock in the
economies which are the main almost 60% in Net Zero. petrochemicals sector, provides
growth markets for liquid fuels. some degree of support to overall
The experience of coronavirus also The pace of decline in liquids liquids demand, increasing in both
triggers some lasting changes in demand in the second half of the Rapid and BAU, and declining below
behaviour, especially increased Outlook – during which it falls by an 2018 levels only in the final 10 years
working from home (see pp 28-29). average of over 2 Mb/d per annum of the Outlook in Net Zero.
in Rapid and 3 Mb/d in Net Zero – is
Liquids demand in Rapid and Net unprecedented and has significant
Zero does not fully rebound from implications for other parts of the oil
this near-term hit to demand and industry, including refining (see pp
subsequently falls substantially over 74-75).
the Outlook to around 55 Mb/d and
30 Mb/d by 2050 respectively.

69 | bp Energy Outlook: 2020 edition

70 |

The supply of liquid fuels is initially driven by US tight oil,

with OPEC’s share recovering later
US tight oil production Liquid fuels supply by region
Mb/d Mb/d

18 80 50%
Rapid Business- NGLs Rapid Business- OPEC
as-usual as-usual
16 Crude & 70 45% Other
condensates non-OPEC
14 Russia
60 40%
50 35% US
40 30% share (RHS)
30 25%
20 20%

2 10 15%

0 0 10%
2018 2030 2050 2030 2050 2018 2030 2050 2030 2050

Key points

The composition of global liquids early 2030s to around 45% by 2050. As well the overall demand for liquid
supply is initially dominated by a The higher cost structure of non- fuels falling, the transition to a lower-
rebound in US tight oil, with OPEC’s OPEC production means around carbon energy mix also prompts
share of production recovering in the two-thirds of the total fall in liquids a shift in the composition of liquid
second half of the Outlook. production in Rapid by 2050 is borne fuels. In Rapid, the overall decline
by non-OPEC supplies. in liquids supply over the Outlook is
In Rapid, US tight oil recovers from more than accounted for by a sharp
the falls caused by the impact of Non-OPEC supplies follow a similar fall in crude and condensates, while
Covid-19, increasing to close to 15 pattern in BAU, expanding in the first the production of biofuels increases
Mb/d in the early 2030s. Brazilian half of the Outlook, led by increases by over 2 Mb/d. Similarly, although
production also grows over the in US tight oil and Brazil, before total liquids supply by 2050 in BAU is
same period. But as US tight declining in the second half as US only slightly lower than 2018 levels,
formations mature and OPEC adopts tight oil peaks in the early 2030s. this is more than accounted for by a
a more competitive strategy against This reduction provides scope for larger fall in crude and condensates,
a backdrop of accelerating declines OPEC to increase its production partially offset by growing supplies
in demand, US production and non- from the mid-2030s onwards, with of natural gas liquids (NGLs) and
OPEC output more generally fall its level of output by 2050 back biofuels.
from the early 2030s onwards. close to 2018 levels and its market
share rising to over 40%.
OPEC production declines over the
next 10 years or so before broadly
stabilizing thereafter, with its share
of total liquids production recovering
from a low of close to 25% in the

71 | bp Energy Outlook: 2020 edition

72 |

Differences in operational carbon intensity of crudes

have an increasing impact as carbon prices increase
Average carbon intensity of crude
production by country, 2015 Carbon intensity: impact on volumes*
g of CO2e/MJ Mb/d

Algeria Lowest quartile
Venezuela of carbon intensity
Canada Middle two quartiles
Iran of carbon intensity
Highest quartile
Nigeria of carbon intensity
Saudi Arabia
0 5 10 15 20 25 30 35 Rapid Business-
Source: Masnadi et al. (2018), Global carbon intensity of crude oil production graph includes countries *Difference in crude and condensate supplies relative to a
with crude and condensates above 1 Mb/d in 2018. Error bars include 5-95th percentile of fields counterfactual in which supplies have the same carbon intensity

Key points

The carbon emissions associated which carbon prices remain relatively The precise extent of this shift
with the production and low over the entire Outlook, the shift between high and low carbon
transportation of crude oil and in the pattern of supplies between intensity supplies depends on
condensates accounted for around those in the highest and lowest the extent the carbon intensity of
5% of total carbon emissions from quartiles of carbon intensity is less different crudes and condensates
energy use in 2015. than 0.5 Mb/d by 2050 compared can be reduced and at what cost.
with a counterfactual case in which For example, it might be possible
There is a significant variation in all supplies are assumed to have the to reduce operational emissions
these operational emissions – same carbon intensity. of some onshore production via
measured by the carbon intensity electrification at relatively little cost.
of crude supplies – across (and In contrast, the higher level of But it seems likely that some of the
within) different countries, reflecting carbon prices in Rapid increases the differences in intensity is likely to
differences in the nature and additional cost levied on supplies persist and so have a bearing on the
location of the operations. These with higher levels of carbon intensity future pattern of supplies if carbon
differences in carbon intensity affect and so has a more material impact prices increase materially.
the exposure of different types of on their competitiveness. In
production to carbon prices. particular, in Rapid, the increasing A similar set of issues applies to
carbon price causes highest quartile differences in the carbon intensity
At low levels of carbon prices, these intensity supplies by 2050 to be of natural gas supplies, which in
differences in carbon intensity have around 2 Mb/d lower than in the addition to differences in the carbon
relatively little impact on overall counterfactual case (a decline of intensity of production, also depend
costs and competitiveness and almost 25%), with correspondingly on whether the gas is transported
hence on the pattern of aggregate greater volumes of lower quartile via pipelines or as LNG, which adds
supplies. For example, in BAU in intensity supplies. to its carbon intensity.

73 | bp Energy Outlook: 2020 edition

74 |

The outlook for refining is challenging, with declining

demand and capacity shutdowns
Refining capacity changes,
Refinery throughput 2018-2050
Mb/d Mb/d

90 20
80 Business- 10 Product
as-usual importers
with growing
70 demand
-20 World

10 -50

0 -60
2010 2018 2030 2040 2050 Rapid Business-

Key points

The outlook for refining is downbeat, levels until the early 2030s, before particularly Europe, OECD Asia and
reflecting the impact of Covid-19 gradually declining to around 10 parts of North America – where
in the near term and a combination Mb/d below 2018 levels by 2050. falling domestic demand increases
of declining liquid fuels demand refineries’ exposure to the highly
and increasing competition from This outlook for falls in refining competitive product export market.
alternative feedstocks further out. throughput contrasts with previously
announced plans to build roughly 9 The degree of market rationalization
Refinery throughputs in both Rapid Mb/d of new refining capacity over required in Rapid is more
and BAU are significantly lower in the next 5 years or so. The scale of pronounced and widespread,
the near term as a result of Covid-19 excess refining capacity could be with around 50 Mb/d of current
reducing the demand for refined even greater if emerging economies (or planned) capacity surplus to
products, especially in the transport in which product demand continues requirements by 2050. The refining
sector (see pp 68-69). to increase – such as India and Africa capacity that is most resilient to
– build additional capacity to limit any these pressures in Rapid is aided
As with the overall demand for increase in import dependency for by: resilient domestic demand,
liquids fuels, refinery runs in Rapid refined products. access to advantaged feedstock,
never fully recover to pre-Covid high levels of upgrading, integration
levels and fall by more than 45 Mb/d The excess refining capacity that with petrochemicals and, in some
to less than half of their 2018 levels emerges in both BAU and Rapid regions, government support.
by 2050. The outlook for refining is leads to increasing competition
a little less challenged in BAU, with and the eventual shutdown of the
refining runs recovering close to pre- least competitive refineries. The
Covid-19 levels over the next few shutdowns in BAU are concentrated
years and remaining around these in the developed economies –

75 | bp Energy Outlook: 2020 edition

76 |

Outlook for gas is more resilient than for either coal or oil

Gas consumption Gas production growth by region

Bcm Bcm

6000 1200
Rapid Business-as-usual Other
1000 Russia
5000 China
600 East
3000 200
1000 Net Zero
Business- -600
0 -800
2000 2010 2020 2030 2040 2050 2018- 2035- 2018- 2035-
2035 2050 2035 2050

Key points

The outlook for gas is more durable The growth of global gas demand The main areas of increasing gas
than for coal or oil, helped by broad- in Net Zero is shorter lived, peaking production in Rapid are China and
based demand and the increasing in the mid-2020s, followed by a far Africa, supported by rising domestic
availability of global supplies. faster decline, such that demand consumption. US and Middle
by 2050 is around 35% below 2018 Eastern gas production by 2050 are
In Rapid, the global demand for levels. largely unchanged from their 2018
gas – natural gas plus biomethane levels, with marked falls in domestic
- recovers from the near-term In contrast, gas demand increases demand offset by increased exports.
dip associated with Covid-19 and throughout the next 30 years in Much of the exports are in the
grows relatively robustly over the BAU, increasing by a third to around form of liquefied natural gas (LNG),
next 15 years or so, driven primarily 5300 Bcm by 2050. This growth which roughly doubles over the
by economies in developing Asia in gas consumption is relatively Outlook in Rapid, increasing the
(China, India, Other Asia) as they widespread, with particularly strong competitiveness and accessibility of
switch away from coal towards increases across developing Asia, natural gas around the globe (see pp
lower-carbon fuels, including gas Africa and the Middle East. 82-83).
(this potential supporting role for
natural gas is explored on pp 80-81). Biomethane increases in all three The much stronger demand growth
Global gas consumption declines scenarios, reaching around 250 in BAU is largely met by increases
in the subsequent 15 years as the Bcm in Rapid and Net Zero, and 100 in output in the US, Middle East and
impetus from developing Asia fades, Bcm in BAU, which is around 6-10% Africa, which together account for
compounded by increasing falls and 2% respectively of total gas around two-thirds of the increase in
in the developed world, such that demand. global supplies in BAU.
global gas demand by the end of the
Outlook falls back close to its 2018
levels at around 4000 Bcm.

77 | bp Energy Outlook: 2020 edition

78 |

The pattern of gas demand differs significantly

across the scenarios
Change in gas demand by sector, 2018-2050

Rapid Net Zero Business-as-usual Power
800 Industry

600 Buildings
200 Hydrogen






Key points

The pattern of changes in global In Rapid, the shift to lower carbon These shifts in the pattern of gas
gas consumption varies markedly energy sources, combined with demand are even more pronounced
across the three scenarios reflecting significant gains in energy efficiency, in Net Zero, with the use of gas
differences in the pace and extent of means gas used in the industrial in the power sector and buildings
the low-carbon transition. and power sectors – the two falling by around 65% and 90%
main sources of growth in gas respectively, partially offset by a
consumption over the past 20 substantial increase in the use of gas
years – is largely unchanged over to produce blue hydrogen.
the Outlook, and falls materially in
buildings. Instead, the main source In contrast, growth in global gas
of strength over the Outlook is demand in BAU is broadly based
the growing use of natural gas to across all sectors of the economy,
produce blue hydrogen, which led by the industrial and power
accounts for almost 10% of global sectors, which together account for
gas demand by 2050 in Rapid (see around two-thirds of the increase.
pp 102-105 for a discussion of the The growth in industrial demand
outlook for hydrogen). stems entirely from emerging
economies as they continue to
industrialize, supported by significant
coal-to-gas switching within China’s
industrial sector.

79 | bp Energy Outlook: 2020 edition

80 |

The role of natural gas in a low-carbon energy transition

Rapid vs. Business-as-usual : India and Other Asia* Natural gas with CCUS as
a share of primary energy
Differences in shares of primary energy

40% 10%
Non-fossil Blue
Natural gas
30% Rapid Direct
8% energy use



-20% Business-

-30% 0%
2018 2025 2030 2035 2040 2045 2050 2050

*Other Asia excludes China and OECD Asia

Key points

Natural gas can potentially play two These two roles can be highlighted There is less need for this supporting
important roles in an accelerated by contrasting the role of natural role in developed countries, where
transition to a low-carbon energy gas in the slow transition envisaged the slower growth in energy demand
system: in BAU with the more accelerated makes it easier for the reduction
decarbonization in Rapid. in coal consumption to be largely
supporting a shift away from matched by the increasing use of
coal in fast growing, developing The role of natural gas supporting non-fossil fuels.
economies in which electricity a shift away from coal can be seen
demand and other uses of coal are most clearly in India and Other Asia. The role of natural gas as a greater
growing quickly, and renewables The greater fall in the share of coal in source of (near) zero-carbon energy
and other non-fossil fuels may not Rapid compared with BAU is mainly in Rapid relative to BAU is clear,
be able to grow sufficiently quickly offset by fast growth in non-fossil with gas combined with CCUS
to replace coal on their own; and fuels, led by renewable energy and accounting for around 8% of primary
supported by a larger increase in energy by 2050 in Rapid, compared
as a source of (near) zero-carbon the share of gas. This supporting with just 1% in BAU. The majority
power when combined with role fades towards the end of the of natural gas with CCUS in Rapid
CCUS, either as a direct source of Outlook as the growth of non-fossil is used as a direct energy source in
energy to the power and industrial energy sources gather pace. industry and power, with the residual
sectors or to produce blue used to produce blue hydrogen.

81 | bp Energy Outlook: 2020 edition

82 |

LNG grows substantially, increasing the accessibility

of gas around the globe
LNG imports and exports
Imports Exports

Other India Other Africa

Europe China 2018 Australia ME
Other Asia OECD Asia Russia US





-1500 -1000 -500 0 500 1000 1500

Key points

LNG expands significantly in both Global LNG imports fall back in LNG trade in BAU grows more
Rapid and BAU, leading to a more the second half of Rapid as import slowly than in Rapid, reaching a little
competitive, globally integrated gas demand in developing Asia starts over 1000 Bcm by 2050. However,
market. to decline. These falls are most even in BAU, around 60% of that
pronounced in China, as overall growth occurs over the next 10
LNG trade in Rapid bounces back demand declines and domestic years or so. As in Rapid, US, Africa
strongly from the near-term fall production (including biomethane) and the Middle East are the main
associated with Covid-19, more than increases. LNG trade by 2050 falls source of incremental supply, with
doubling over the first half of the to around 970 Bcm. The pace of this developing Asia the dominant
Outlook, increasing from 425 Bcm decline in LNG exports after the mid- destination for these increasing
in 2018 to around 1100 Bcm by the 2030s is greater than the speed of exports, along with the EU which
mid-2030s. depreciation of liquification facilities, remains an important balancing
implying that towards the end of the market for LNG in both scenarios.
This fast growth is driven by Outlook some facilities need to be
increasing gas demand in developing operated at less than full capacity or
Asia (China, India and Other Asia) as shutdown prematurely.
gas is used to aid the switch away
from coal and LNG imports are the
main source of incremental supply.
This surge in LNG demand is met
by increasing supplies from the US,
Africa and the Middle East, which
emerge as the three main hubs for
LNG exports.

83 | bp Energy Outlook: 2020 edition

84 |

Renewable energy in power grows quickly,

driven by wind and solar power
Renewable energy used in power sector Cost of wind and solar energy by scenario
EJ 100% = 2018 price

400 Geothermal 100% Rapid

& biomass Net Zero
350 Net Zero Solar Business-
Wind 80%
as-usual 40%


0 0%
2018 2050 2018 2025 2030 2035 2040 2045 2050

Key points

Renewable energy used in the The fast pace of growth eases In both Rapid and Net Zero, wind
power sector – wind, solar, biomass slightly from the late 2030s onwards and solar power account for broadly
and geothermal – grows quickly in as the costs of balancing the similar absolute increases in power
all three scenarios, aided by falling intermittency associated with adding generation. This equates to a
costs of production and policies increasing amounts of wind and significantly faster rate of expansion
encouraging a shift to lower-carbon solar power rise. Even so, the share in solar power, supported by (and
energy sources. of renewables in primary energy driving) the greater cost declines.
grows from around 5% in 2018 to
The expansion of renewable energy 45% by 2050 in Rapid and 60% in The growth of renewables in power
in power in Rapid and Net Zero far Net Zero. is less fast in BAU, although they
outpaces the growth of primary still grow seven-fold and contribute
energy, increasing by around 250 The growth in renewable energy is around 90% of the growth in
EJ and 350 EJ respectively over dominated by wind and solar power, primary energy over the Outlook.
the Outlook – around five and underpinned by continuing falls in
seven times greater than the overall development costs as they move In all three scenarios, emerging
increase in primary energy. down their ‘learning curves’. Over economies account for the majority
the next 30 years, wind and solar of the growth in renewable energy,
costs fall by around 30% and 65% in driven by stronger growth in power
Rapid respectively and by 35% and generation and by the increasing
70% in Net Zero. share of renewables in power,
especially at the expense of coal.

85 | bp Energy Outlook: 2020 edition

86 |

The build out of wind and solar power capacity accelerates sharply

Annual average increase in wind and solar capacity Installed capacity of wind and solar energy

1000 25000
Rapid hydrogen
Net Zero Electricity
Net Zero generation
800 Business- 20000

600 15000

400 10000

200 5000

0 0
2000- 2005- 2010- 2015- 2018- 2025- 2030- 2035- 2040- 2045- 2050
2005 2010 2015 2018 2025 2030 2035 2040 2045 2050

Key points

The growth of wind and solar power The fast growth in wind and solar In Rapid and Net Zero, developed
generation in all three scenarios power generation in Rapid and Net countries represent around 25% of
requires a significant acceleration in Zero followed by a subsequent total deployment of wind and solar,
the build out of renewable capacity. slowing as the costs of intermittency China accounts for broadly another
build is reflected in the pattern of 25%, with the rest accounted for by
The average annual increase in wind capacity additions, which peak other emerging economies. In BAU,
and solar capacity in Rapid and Net around 2035 in Rapid and Net Zero developed economies have a larger
Zero over the first half of the Outlook before slowing sharply. This hump in role - accounting for around a third of
is around 350 GW and 550 GW the pattern of new additions raises total deployment.
respectively, between 6 and 9 times the risk of excess capacity within the
faster than the annual average of renewables supply chain towards A significant share of wind and solar
around 60 GW since 2000. the end of the Outlook. energy is used to produce green
hydrogen in Rapid and Net Zero, with
Although such an acceleration in The acceleration in the build out of this share increasing to around 20%
wind and solar capacity requires a wind and solar capacity in BAU is of total installed capacity by 2050
significant increase in investment more gradual and steadier, although in Rapid and to around a third in
spending, the extent of that increase the average annual rate of capacity Net Zero.
is partially offset by the falling construction (235 GW) over the
development costs of wind and Outlook is still considerably faster
solar energy. The implications for than past rates of expansion
investment in wind and solar energy
are considered on pp 132-133.

87 | bp Energy Outlook: 2020 edition

88 |

The role of coal in the global energy system declines,

driven by China
Coal consumption Change in coal demand by sector and region, 2018-2050

180 40
Rapid Business-as-usual
20 Other Asia
140 India
120 China

-20 Developed

80 -40

40 Rapid
Net Zero
20 Business-
0 -100
2000 2010 2020 2030 2040 2050 Power Industry Other Power Industry Other
sectors sectors

Key points

Global coal consumption declines The contraction in coal consumption around two-thirds of the remaining
consistently over the next 30 is less pronounced in BAU, falling use of coal in BAU (see pp 100-101
years in all three scenarios, never by around 25% by 2050, with the for a discussion of the prospects for
recovering back to its peak level of speed of that decline accelerating coal-fired power generation in India).
2013. through the Outlook. China accounts
for the vast majority of the fall, In both Rapid and Net Zero, most
The scale of the decline is followed by the US and the EU. The of the coal consumption remaining
particularly pronounced in Rapid and overall fall in global coal consumption in 2050 is used in conjunction with
Net Zero, in which coal is almost is partially mitigated by continuing CCUS, concentrated in the power
entirely eliminated from the global increases in India and Other Asia. By sector and the production of blue
energy system over the next 30 2050, developing Asia (China, India hydrogen.
years, falling between 85-90%, with and Other Asia) accounts for over
the share of coal in primary energy 80% of total coal consumption in The falls in global coal demand
dropping to less than 5% by 2050 in BAU. are matched on the supply side
both scenarios. by significant falls in Chinese coal
The falls in coal consumption are production, which accounts for
The fall in coal demand in Rapid and concentrated in the power and the vast majority of the production
Net Zero is dominated by China as it industrial sectors. In Rapid and Net declines in both Rapid and BAU.
shifts to a more sustainable pattern of Zero, the power sector accounts
growth and a lower-carbon fuel mix. for around two-thirds of the decline
Declines in Chinese coal consumption as power generation is largely
account for around half of the overall decarbonized; whereas in BAU, the
fall in global demand in these two falls are distributed roughly evenly
scenarios, supported by declines in between the two sectors. By 2050,
OECD, India and Other Asia. the power sector accounts for

89 | bp Energy Outlook: 2020 edition

90 |

Growth in nuclear power is dominated by China

Nuclear generation Change in nuclear generation by region, 2018-2050


8000 5000
Net Zero Other

7000 Rapid EU
Net Zero US
6000 Business- Rapid
Middle East
as-usual 3000
as-usual India
2000 China
4000 Total


1000 -1000

0 -2000
2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2018 - 2050

Key points

Nuclear energy grows throughout Nuclear power in the developed The growth of nuclear generation
the Outlook in all three scenarios, as economies falls slightly in Rapid is slower in BAU, increasing by
strong growth in China offsets weak and edges higher in Net Zero. In around 40% by 2050, with its share
or falling nuclear power generation in both scenarios, the pressure to in primary energy edging lower.
the developed world. decarbonize the power sector more The pattern of growth in BAU is
quickly than other zero-carbon even more lopsided, with China
Nuclear generation grows robustly energy sources and balancing accounting for more than the entire
in Rapid and Net Zero, increasing by technologies can be deployed growth of nuclear power generation,
around 100% and 160% respectively is partially met by extending the partially offset by declines in the
by 2050. China accounts for around operating lifetimes of nuclear power US and Europe as aging nuclear
60% of this growth in Rapid – plants in the US and Europe, many plants are retired and a combination
and 40% in Net Zero – as China to 60 years or more. of economic and political factors
continues to diversify away from means they are not replaced by
coal towards a lower-carbon fuel The pace of build out of new new capacity. The level of nuclear
mix in the power sector. The share capacity additions in Rapid is generation in China by 2050 in BAU
of nuclear power in China’s power comparable to that seen in the is around twice that of the entire
generation increases from around heyday of nuclear power in the developed world.
4% in 2018 to more than 15% by 1980s – and even quicker in Net Zero
2050 in both scenarios. Nuclear – with the pace of construction in
power generation also increases in Rapid increasing more than two-fold
India, Other Asia and Africa. relative to recent rates of expansion.

91 | bp Energy Outlook: 2020 edition

92 |

Hydroelectricity grows over the next 30 years

but at a slower pace than in the past
Hydroelectricity generation by region Hydroelectricity growth by region
TWh % per annum

8000 Net Zero 3.0%

7000 Business- Africa
as-usual 2.5%
S&C America
Other Asia Net Zero
China Rapid
4000 Developed 1.5% Business-


0 0%
2018 2050 2000 - 2018 2018 - 2050

Key points

Hydroelectricity expands throughout The slowing in hydroelectricity Some of this slowing in the growth
the Outlook, but the pace of growth relative to past trends is dominated of Chinese hydro power generation
slows in the second half of all three by China, where the robust build is offset by an acceleration in
scenarios as the availability of the out of hydro facilities over the past Other Asia, Latin America, and
most advantaged sites gradually 20 years accounted for around Africa, where growing economic
wanes. three-quarters of global growth in prosperity and accelerating power
hydroelectricity. But as the most demand increase the economic
The greater pressure to decarbonize productive and advantaged sites viability of developing the abundant
the energy system in Rapid and in China are exploited, the growth geographical sites available in these
Net Zero helps to support stronger of Chinese hydro power slows, regions.
growth of hydro energy than in averaging between 1.3-1.7% p.a. in
BAU, even so the growth of hydro the three scenarios, down from an
power in all three scenarios over average annual rate of almost 10%
the Outlook – ranging from 1.3% to over the past 20 years.
1.6% p.a. – is slower than the past
20 years (2.6 p.a.). The share of
hydro in global power generation is
broadly stable in all three scenarios
at around 15%.

93 | bp Energy Outlook: 2020 edition

94 |

Other energy

Electricity and power generation


95 | bp Energy Outlook: 2020 edition

96 |

Electricity demand grows robustly as the world

continues to electrify
Change in electricity demand
Share of electricity in total final consumption by sector, 2018-2050

60% 25000
Rapid Industry
50% Net Zero Buildings




0% 0
2000 2010 2020 2030 2040 2050 Rapid Net Zero Business-

Key points

The world continues to electrify, stronger overall growth in energy The increase in electricity use in
leading the power sector to play an consumption than in the other two Rapid and Net Zero is broadly based
increasingly central role in the global scenarios. across all three sectors (industry,
energy system. transport and buildings) of the
The energy required to meet the economy, with electricity used in the
The growth in final electricity growing use of electricity for final transport sector rising most strongly
demand is similar in all three consumption is the dominant source as increasing amounts of road
scenarios, growing by just under 2% of incremental demand for primary transportation are electrified
p.a., such that demand expands by energy in all three scenarios. As a (see pp 42-45).
around 80% by 2050. result, the share of primary energy
that is absorbed by the power sector In contrast, the slower gains in
The extent to which the energy increases from 43% in 2018 to energy efficiency in buildings and
system electrifies is greatest around 60% by 2050 in Rapid and industry in BAU means these
in Rapid and Net Zero as the Net Zero and to a little over 50% in sectors account for around 80% of
progressive decarbonization of the BAU. the growth in power demand, with a
energy system leads to increasing more subdued increase in transport.
amounts of final energy use being The vast majority of the growth
electrified. The share of electricity in electricity demand in all three
in total final consumption increases scenarios is driven by emerging
from a little over 20% in 2018 to markets, led by developing Asia
45% in Rapid by 2050 and over 50% (China, India, and Other Asia) and
in Net Zero, compared with just 34% Africa, as increasing prosperity and
in BAU. The growth of electricity living standards underpin higher
demand in BAU is supported by electricity consumption.

97 | bp Energy Outlook: 2020 edition

98 |

Growth in power generation is led by wind

and solar power as coal loses share
Share of global power generation by energy source

Rapid Net Zero Business-as-usual

Wind & solar
60% Natural gas





2000 2010 2020 2030 2040 2050 2000 2010 2020 2030 2040 2050 2000 2010 2020 2030 2040 2050

Key points

The growth of global power The main fuel to lose ground is coal, The changes in the fuel mix,
generation is dominated by with the share of coal-fired power combined with the increasing use of
renewable energy. generation in global power falling CCUS, means the carbon intensity
from 38% in 2018 to less than 3% in of power generation falls by over
Renewable energy, led by wind 2050 in Rapid and Net Zero, and to 90% in Rapid, compared with just
and solar power (and including around 20% in BAU. 50% in BAU. As a result, despite
biomass and geothermal), more the substantial increase in power
than accounts for the entire growth The use of gas in the power sector generation, carbon emissions from
in global power generation in Rapid increases during the first half of the the power sector decrease by
and Net Zero and for around three- Outlook in Rapid as it gains share over 80% in Rapid, compared with
quarters of the growth in BAU. from coal but falls back close to its just 10% in BAU. In Net Zero, the
2018 level by 2050 as the use of use of bioenergy combined with
The increasing cost of balancing the renewables accelerate. The initial CCUS (BECCS) means that net CO2
intermittency associated with the growth of gas in Net Zero is shorter emissions from the power sector are
use of wind and solar power as their lived and the subsequent decline negative by 2050.
share rises causes the pace at which sharper. In contrast, the use of gas
they penetrate the power sector to in BAU increases broadly in line
slow in the 2040s in Rapid as their with overall power demand, with
share of global power rises above its share in global power generation
50%. Similarly, the share of wind edging down only slightly. By 2050,
and solar power in Net Zero begins roughly half of the natural gas used
to flatten out in the 2040s as it rises to generate power in Rapid and
above 60%. around 90% in Net Zero is used in
conjunction with CCUS.

99 | bp Energy Outlook: 2020 edition

100 |

The challenge of decarbonizing the Indian power sector

Share of Indian power generation Annual average net capacity
by energy source in Rapid additions in wind and solar in India Generation from gas in India

80% 120 1000

Wind & solar Rapid
Gas Business-as-usual
Coal 100 Alternative case 1 800
80 Net Zero
600 Business-
40% 60 Alternative
case 2

0% 0 0
2015 2020 2025 2030 2035 2040 2045 2050 2010- 2015- 2018- 2025- 2030- 2035- 2040- 2045- 2015 2020 2025 2030 2035 2040 2045 2050
2015 2018 2025 2030 2035 2040 2045 2050

Key points

The challenge of decarbonizing the The pace and extent of the One option to avoid any increase in
power sector in economies and decarbonization of power is greater Indian coal-fired power generation
regions in which there is strong in Rapid, with coal power generation would be for wind and solar power
growth in electricity demand is falling by around 40% by 2050. to accelerate even more quickly over
illustrated by the outlook for the Wind and solar power generation the next 10 years, averaging around
Indian power sector. grow by around 30-fold and 60-fold 45 GW per year, compared with 30
respectively, and gas over 13-fold. GW in Rapid and an average of 3
Electricity consumption in India GW since 2000. This is illustrated by
increases robustly in all three However, even in Rapid, Indian coal- ‘Alternate case 1’ above.
scenarios, growing between 4.0- fired power generation increases
4.6% p.a. over the Outlook, as by around a third over the next 10 Another alternative (as shown by
improving prosperity and living years or so before subsequently Alternate case 2) would be to bring
standards boost industrial and declining. This requires around 50 forward some of the growth of
residential demand. new coal-fired power stations to be gas-fired power generation that
built in the 2020s, with the likelihood happens later in the Outlook. If
In BAU, wind and solar power that some of these power stations gas power generation is increased
generation increase more than 20- become uneconomic as coal sufficiently to prevent any increase
fold by 2050, growing at an average generation subsequently declines. in coal generation, this would reduce
rate of 10% p.a.. Despite that, Indian A similar near-term increase in coal carbon emissions by around
coal-fired power generation doubles generation, albeit less pronounced, 2 Gt CO2 over the next decade
over the Outlook in BAU, requiring is apparent in Net Zero. relative to Rapid.
more than 100 new coal-fired power
plants to be built over the next 15

101 | bp Energy Outlook: 2020 edition

102 |

Hydrogen plays an increasing role as the world transitions

to a low-carbon energy system
Hydrogen use by sector Hydrogen use by region

70 70
Power Other
Rapid Net Zero Rapid Net Zero
Transport India and
60 60 Other Asia
50 50 Europe
North America
40 40 China

30 30

20 20

10 10

0 0
2035 2050 2035 2050 2035 2050 2035 2050

Key points

The use of hydrogen as an energy Hydrogen complements the growing The use of hydrogen in Rapid is
carrier* increases significantly in role of electricity in Rapid and Net most pronounced in China and
Rapid and Net Zero as the world Zero because it can be used for the developed economies which
transitions to a lower-carbon energy some activities which are difficult lead the world in its adoption,
system. The hydrogen can be used or costly to electrify, especially in supported by rising carbon prices
either directly or combined with (bio) industry and transport, and because and increasing deployment of
carbon or nitrogen to make it easier it can be more easily stored than infrastructure and other policies
to transport. electricity. supporting its use. This adoption is
more broadly-based in Net Zero, with
The growth of hydrogen is Hydrogen has a particular advantage significant increases also in India and
concentrated in the second half of in industry as a source of energy for other parts of developing Asia.
the Outlook as falling technology and high-temperature processes, such
input costs, combined with rising as those used in steel, cement, In contrast, the role of hydrogen
carbon prices, allow it to compete refining and petrochemicals sectors. within BAU is far more limited,
increasingly against incumbent fuels. By 2050, hydrogen accounts for mirroring the minimal progress made
By 2050, hydrogen accounts for around 10% of total final energy in decarbonizing the energy system.
around 7% of (non-combusted) total consumption in industry in Rapid and
final energy consumption (excluding 18% in Net Zero.
the non-combusted use of fuels) in
Rapid and around 16% in Net Zero. The use of hydrogen in transport
is concentrated in long-distance
transportation, particularly heavy-
duty trucks in which 7% of VKM
in Rapid by 2050 are powered by
hydrogen and 10% in Net Zero.
*The Outlook does not include the role
of hydrogen as a feedstock in industry
103 | bp Energy Outlook: 2020 edition
104 |

Most hydrogen production by 2050 is a combination

of green and blue hydrogen
Hydrogen production by type Annual average increase in wind and solar capacity

70 1400
Grey Rapid
Rapid Net Zero hydrogen
60 Blue 1200
Net Zero
Net Zero with 100%
50 Green 1000 green hydrogen

40 800

30 600

20 400

10 200

0 0
2018 2035 2050 2035 2050 2000- 2005- 2010- 2015- 2018- 2025- 2030- 2035- 2040- 2045-
2005 2010 2015 2018 2025 2030 2035 2040 2045 2050

Key points

The production of hydrogen in Rapid facilities which produce hydrogen Second, production of green
and Net Zero is dominated by green using natural gas or coal without hydrogen diverts renewable energy
and blue hydrogen. CCUS (so-called grey hydrogen). that could potentially be used to
decarbonize further the power
Green hydrogen is made by The production of blue hydrogen sector. Given that the vast majority
electrolysis using renewable helps supplies of hydrogen to of domestic power sectors over the
power; blue hydrogen is extracted grow relatively quickly in Rapid and Outlook are not fully decarbonized
from natural gas (or coal) and the Net Zero without relying only on in either scenario, only renewable
displaced carbon is captured and renewable energy. This is important energy which cannot be used within
stored (CCUS). for two reasons. the domestic power sector can
strictly be used to produce green
The ability of many countries First, relying exclusively on green hydrogen. This would be the case if
to produce either green or blue hydrogen would require an even the renewable energy is curtailed at
hydrogen, combined with relatively faster expansion in wind and solar certain points in time or because its
high transport costs, means that the capacity. To achieve the same level location means it is not economic for
majority of hydrogen is produced of hydrogen production as in Net it to be connected to the central grid.
relatively locally, with a mix of blue Zero using only green hydrogen,
and green hydrogen depending would require an average build out
of local conditions. By 2050, over of wind and solar capacity of around
95% of hydrogen in Rapid and Net 800 GW per year over the Outlook,
Zero comes from green and blue compared with less 600 GW in Net
hydrogen in broadly equal amounts. Zero and around 60 GW over the
The remainder comes from legacy past 20 years.

105 | bp Energy Outlook: 2020 edition

106 |

Carbon emissions
from energy use

Carbon pathways
Alternative scenario: Delayed and Disorderly

107 | bp Energy Outlook: 2020 edition

108 |

Carbon emissions fall significantly in Rapid and Net Zero ;

little progress in Business-as-usual
Global carbon emissions from energy use Carbon emissions by sector
Gt of CO2 Gt of CO2

40 40
35 35 Buildings
as-usual Transport
30 30
25 25 Power
20 20
15 below 2˚C 15
IPCC 2˚C median
10 IPCC 1.5˚C median 10 Rapid
5 Net Zero 5
Net Zero
0 0

1980 1990 2000 2010 2020 2030 2040 2050 2018 2050

Ranges show 10 th and 90 th percentiles of IPCC scenarios, see pp 150-151 for more details

Key points

The impact of Covid-19 causes by the second half the Outlook the The composition of the carbon
carbon emissions from energy to fall emissions pathway in Net Zero is emissions remaining in 2050
sharply in the near-term. Although close to the middle of the IPCC in Rapid provide a sense of the
emissions subsequently pick up as range. hardest-to-abate emissions. The
the global economy recovers, the largest source of emissions is the
level of carbon emissions in Rapid The carbon emissions remaining transport sector which accounts
and Net Zero do not return to their in 2050 in Net Zero could be for around third of the remaining
pre-pandemic levels. reduced further by either additional emissions, with the industrial and
changes in the energy system power sectors each accounting for
Carbon emissions from energy use or using negative emissions around a quarter.
in Rapid fall by around 70% by 2050 technologies (NETs). Alternatively,
to a little over 9 Gt CO2. This fall in the emissions could be offset by The transport and industrial sectors
emissions is broadly in the middle of increased deployment of natural account for the majority of the
the range of ‘well below 2-degree’ climate solutions (NCS) (see pp remaining emissions in Net Zero in
scenarios contained in the 2019 130-131). This will partly depend on 2050. These emissions are partially
IPCC Report. See pages 150-151 the costs of NETs and of abating offset by net negative emissions
for details on the construction of the GHGs emitted from outside the from the power sector, stemming
IPCC scenario ranges. energy system, neither of which are from the use of biomass combined
explicitly considered in this Outlook. with CCUS (BECCS), which reduce
In Net Zero, carbon emissions net carbon emissions by around 1.5
fall by over 95% from their 2018 The extent of the decline in carbon Gt CO2 by 2050.
levels to around 1.5 Gt CO2 by emissions from energy use in BAU
2050. The initial pace of decline is far more limited. Emissions peak
is slower than the range of IPCC around the mid-2020s and decline
‘below 1.5-degree’ scenarios, but only gradually, falling to around 10%
below 2018 levels by 2050.
109 | bp Energy Outlook: 2020 edition
Carbon emissions
110 |

The fall in emissions in Rapid and Net Zero driven

by switch to low-carbon energy
Carbon capture utilization
Carbon emissions from energy use and storage in 2050
Gt of CO2 Gt of CO2

40 6
Efficiency Hydrogen

35 Energy mix Industry

CCUS 5 Power
30 Rapid
Net Zero 4
25 Business-as-usual

20 3


0 0
2018 2025 2030 2035 2040 2045 2050 Rapid Net Zero

Key points

The reduction in carbon emissions The rest of the difference between patterns towards lower-energy
in Rapid and Net Zero reflect a the carbon pathways in Rapid and activities. These changing societal
combination of increased switching BAU reflects stronger gains in preferences accentuate the impact of
to low-carbon fuels, greater gains in energy efficiency and greater use government low-carbon policies.
energy efficiency, and growing use of of CCUS. By 2050, CCUS is used
carbon capture technologies (CCUS). to capture and store around 4 Gt The largest factor contributing to the
CO2 of potential emissions in Rapid, greater declines in carbon emissions
The most important factor with around three quarters of the in Net Zero relative to Rapid is
accounting for the reduction in captured emissions emanating from the further switching away from
carbon emissions in Rapid, relative the industrial and power sectors and fossil fuels into zero-carbon energy
to the BAU emissions pathway, is the remainder from the production of sources, especially renewable
the additional degree of switching blue hydrogen. energy.
to low-carbon fuels which accounts
for around 45% of the difference by The additional reductions in carbon There are also contributions from
2050. This is driven by significant emissions in Net Zero relative to faster gains in energy efficiency
reductions in the use of coal, Rapid are partly enabled by changes and greater use of CCUS. By 2050,
especially in developing Asia, with in the behaviour and preferences the amount of carbon captured and
much of this replace by faster of companies and households, stored in Net Zero is around 5.5 Gt
penetration of renewable energy with increased focus on using CO2, with the majority employed in
and, to a lesser extent, gas. energy more efficiently, greater the production of blue hydrogen and
switching to zero or low-carbon fuels the power sector.
and adjusting their consumption

111 | bp Energy Outlook: 2020 edition

Carbon emissions
112 |

Alternative scenario: Delayed and Disorderly

A delayed transition may lead to a disorderly adjustment path

Energy intensity Carbon intensity of energy

MJ per $US of GDP Mt of CO2 per EJ

5.5 70
5.0 Business-as-usual 60
Delayed and Disorderly
4.5 50

4.0 40

3.5 30

3.0 20
2.5 10 Business-as-usual
Delayed and Disorderly
2.0 0
2010 2020 2030 2040 2050 2000 2010 2020 2030 2040 2050

Key points

Rapid and Net Zero assume that Delayed and Disorderly is highly Given these constraints on the
government and society begin stylized - the nature of any delayed speed and extent to which energy
to change policy and behaviour transition path will depend on the efficiency and fuel switching
relatively quickly, such that carbon factors triggering the eventual can improve, any further actions
emissions from energy use start to change and the response of necessary to achieve the cumulative
fall over the next few years. But it is government and society. The emissions target are assumed to
possible that there is an extended scenario is predicated on the take the form of energy ‘rationing’,
delay before these types of changes assumption that there are costs that is, policies that stop or restrict
take place, with an increasing to delaying action. In particular, it various energy-using outputs or
likelihood of a sharp tightening in assumes that it is not possible to activities.
climate policies the longer the world make greater progress in energy
remains on an unsustainable path. efficiency or fuel switching by 2050 For simplicity, Delayed and
than is achieved in Rapid. As such, Disorderly assumes that the
This possibility is explored in an for illustrative purposes, it assumes required energy rationing is imposed
alternative Delayed and Disorderly that from 2030 onwards the: proportionality across the main
scenario in which the global energy sectors of the economy, with the
system is assumed to move in line degree of energy efficiency degree of rationing increasing at a
with BAU until 2030, after which (including recycling, reuse and constant rate over the Outlook.
sufficient policies and actions are reduce) improves linearly and
undertaken to limit cumulative reaches the same level as Rapid
carbon emissions over the Outlook by 2050;
(2018-50) to be the same as in
Rapid. carbon intensity of the fuel mix
improves linearly and reaches the
same level (including CCUS) as
Rapid by 2050;
113 | bp Energy Outlook: 2020 edition
Carbon emissions
114 |

Alternative scenario: Delayed and Disorderly

A delayed and disorderly transition leads to
significant economic costs
Cumulative carbon emissions Primary energy consumption
Gt of CO2 EJ

1000 800
Delayed and Disorderly (before rationing)
Delayed and Disorderly




200 Rapid
100 Delayed and Disorderly (before rationing)
Delayed and Disorderly
0 0
2018 2025 2030 2035 2040 2045 2050 2010 2015 2020 2025 2030 2035 2040 2045 2050

Key points

Delaying the start of the decisive More significantly, the implied scale in buildings – a reduction in energy
shift to a low-carbon energy system of energy rationing necessary to use relative to the 2050 level in
until 2030 significantly increases achieve the reduction in carbon is Rapid roughly equivalent to the
the scale of the challenge relative to equivalent to around a quarter of the energy used to fuel the entire
Rapid: carbon emissions start from a energy consumption between 2030 buildings sector in the EU today.
higher level and there is less time to and 2050 in Rapid.
make the adjustments. Although not modelled explicitly, this
Assuming this rationing is imposed rationing is likely to have a significant
This delay leads to significant proportionately across the main impact on economic activity and
economic cost and disorder in sectors of the economy, it is roughly levels of well-being.
Delayed and Disorderly. equivalent to:

Achieving the same improvements in industry – offsetting around

in energy efficiency and the fuel 20 years of growth in industrial
mix as in Rapid in two-thirds of the output;
time is likely to require a significant
diversion of investment from other in transport – reducing car travel by
productive activities and lead to the up to two-thirds and air travel by
premature scrapping of productive half relative to their 2050 levels in
assets. Rapid, together with similar scale
reductions in commercial and
marine transportation;

115 | bp Energy Outlook: 2020 edition

Carbon emissions
116 |

Low carbon transition leads to fundamental changes

in the global energy system
Share of electricity and hydrogen
Hydrocarbon use by scenario in total final consumption* Total final consumption by carrier*
100% = 2018 level EJ

120% 70% 500

Rapid Bioenergy
Net Zero
60% Electricity
Electricity 400 Hydrogen
50% Rapid Natural gas
Net Zero
300 Oil
60% Coal
Hydrogen 100
20% Net Zero

0% 0% 0
2018 2025 2030 2035 2040 2045 2050 2010 2020 2030 2040 2050 2018 2050

*Excluding non-combusted

Key points

The transition to low-carbon energy These traditional forms of energy are The shift away from traditional
system in Rapid and Net Zero leads replaced to a large extent by low- hydrocarbons also leads to an
to a fundamental restructuring of the carbon energy carriers in the form increasing role for bioenergy.
global energy system. of electricity and, to a lesser extent, Bioenergy takes various forms
hydrogen. By 2050, electricity including liquid biofuels used largely
These changes are led by the accounts for around 50% of final in transport; biomethane which
declining importance of fossil fuels: consumption (excluding the non- can be used as a direct substitute
oil, natural gas and coal. The use combusted use of fuels) in Rapid for natural gas across all sectors of
of hydrocarbons in both Rapid and around 60% in Net Zero. This the economy; and biomass used
and Net Zero peak in the next few greater recourse to electricity is predominantly in the power sector.
years, falling by around 50% and complemented by the increasing By 2050, bioenergy accounts for
70% respectively by 2050. Within use of hydrogen which is used around 7% of primary energy in
that, the combined use of oil and for activities which are harder or Rapid and almost 10% in Net Zero.
natural gas falls by around a third more costly to electrify. By 2050,
and two-thirds in Rapid and Net Zero hydrogen accounts for around 7% of The uncertainties surrounding the
respectively. final energy consumption in Rapid eventual nature of the global energy
and 16% in Net Zero. system in a net-zero world are
considered in the next section.

117 | bp Energy Outlook: 2020 edition

118 |

Global energy
system at net zero

Energy demand
Electrification and the power sector
Oil and natural gas
Bioenergy and hydrogen
CCUS and negative emission technologies

119 | bp Energy Outlook: 2020 edition

Net zero
120 |

Key uncertainties surrounding the global energy system

in a net-zero world
Total final consumption by energy source in 2050*

from bioenergy
Net Zero Electricity



Natural gas


0 50 100 150 200 250 300 350 400

*Excluding non-combusted

Key points

There is significant uncertainty Energy demand: to what extent Carbon capture and negative
surrounding the structure of the global could efficiency improvements and emission technologies: how
energy system in a net-zero world. changing consumption patterns cause significant could CCUS be in
energy demand to decouple from reducing carbon emissions, and
The composition of energy in Net economic activity; what is the potential for negative
Zero in 2050 may provide some emission technologies and actions?
insight: total final energy consumption Electrification and the power sector:
(excluding non-combusted energy) what proportion of final energy These uncertainties are discussed in
is close to 10% lower than in Rapid; consumption might be electrified, and the rest of this section. The analysis
electricity, hydrogen and bioenergy what different energy sources and is aided by considering the scenarios
together account for around 85% of technologies may be needed in a fully included in the IPCC Report which
end energy use; and CCUS plays a decarbonized power sector; reach a net-zero energy system and
significant role. considering the variation in outcomes
Other zero-carbon energy sources across those scenarios (see pp
But there are myriad transition paths and carriers: what are the scope and 150-151 for more detail).
to a net-zero world which will affect limitations on the share of global
the eventual structure of the energy energy use that could be provided by
system and that structure is likely to bioenergy and hydrogen;
continue to evolve even once it has
reached net zero. Oil and natural gas: what role will oil
and natural gas play as the energy
There are (at least) five sources of system is decarbonized;
uncertainty surrounding the size and
structure of a net-zero energy system:

121 | bp Energy Outlook: 2020 edition

Net zero
122 |

Net-zero energy system: how much energy will the world need?
Global energy demand in
IPCC scenarios and Net Zero Total final consumption in 2050

IPCC range
at net zero*
Demand if energy
1200 IPCC median per head at least
at net zero at EU level
Net Zero
1000 in 2050

Demand if energy
per head at EU level
in all regions


200 Net Zero

Primary Total final 0 100 200 300 400 500 600
energy consumption
*Ranges show 10 th and 90 th percentiles of IPCC scenarios

Key points

The nature of a net-zero energy Global energy demand will also The size of the energy system will
system will depend importantly on depend on the equality of energy also be affected by the relative
its overall size: how much energy is access and use globally. In Net Zero, importance of different energy
required for the global economy to average energy consumption per sources and carriers. In particular,
continue to grow and prosper? capita in the developed world by the conversion process used to
2050 is still more than twice that in produce energy carriers such as
This depends partly on the extent emerging economies, with billions electricity and hydrogen boosts
to which it is possible to decouple of people living in energy deficient primary energy. The range of
energy consumption from economic countries and regions. To reduce primary energy in the IPCC net-
activity, through either improving that inequality, either overall energy zero scenarios is 550-1210 EJ –
energy efficiency – producing the provision would need to increase or considerably more than total final
same goods and services with energy consumption in developed consumption of energy.
less energy – or reduced energy economies fall further.
use – changing production and Even if the vast majority of this
consumption patterns to make less If regions with energy consumption primary energy is zero carbon,
demands on the energy system, e.g. per capita below EU levels increased the overall footprint of the energy
through the expansion of circular and to at least EU levels, global energy system is still likely to have wider
sharing economies. demand would be over 55% higher. implications due to the competing
This required increase falls to demands for (and environment
The IPCC scenarios suggest a wide around 45% if regions with energy impacts of) the materials, land and
range for final end use of energy consumption per capital above water it requires.
between 340-620 EJ in net zero. EU levels reduced their average
That compares with 425 EJ in 2018 consumption levels to EU levels.
and with 340 EJ in Net Zero in 2050
which is at the bottom of this range.

123 | bp Energy Outlook: 2020 edition

Net zero
124 |

Net-zero energy system: significant increase in electrification

and decarbonized power sector
Shares of electricity, wind and solar
in IPCC scenarios and Net Zero Technologies to help balance power system at different durations

90% Seconds Minutes Hours Days Weeks Seasons

IPCC range Not
at net zero applicable/
Batteries expensive
80% IPCC median
at net zero Most
Pumped advantaged
Net Zero hydro
70% in 2050 Less
Demand advantaged
response and
60% Hydro with

50% Hydrogen

Gas (or coal)

40% with CCUS

Bioenergy with
or without CCUS
Share of Share of wind
electricity in & solar
final energy in electricity

Key points

A net-zero energy system is likely and other supporting technologies to seconds to a few hours, this is likely
to be characterized by a substantial ensure reliability. The intermittency to be met largely from a combination
increase in the electrification of of wind and solar power means the of batteries, pumped hydroelectricity
energy-consuming activities, with cost of balancing the power sector and demand-side responses.
the electricity generated from a is likely to increase as the share
fully decarbonized (or net negative) of wind and solar power grows, But some of these technologies
power sector. slowing the extent to which they and actions are unlikely to be
penetrate the power sector. technically or economically feasible
But not all energy processes for longer-duration balancing across
and uses can be technically or In the IPCC net-zero scenarios, wind multiple days, weeks and seasons.
economically electrified, such and solar power provides between This longer-term balancing is likely
as high-temperature industrial 40-85% of global power generation. to be met by a combination of
processes or long-distance In Net Zero, the share of wind and bioenergy; natural gas (or coal)
transportation. In the IPCC net-zero solar reaches a little above 60% in combined with CCUS; hydrogen;
scenarios, between 40-70% of end the early 2040s after which it begins and hydroelectricity combined with
energy use is electrified; in Net Zero, to plateau. high-capacity reservoirs. In Net Zero,
a little over 50% of end energy use bioenergy, natural gas with CCUS,
is electrified by 2050. A power system dominated by hydro and hydrogen collectively
wind and solar power generation is account for 30% of power
A fully decarbonized power sector is likely to require a range of different generation in 2050.
likely to be dominated by zero- and energies and technologies to help
near-zero carbon energy sources, led balance their intermittency. For
by wind and solar power, together short-duration, high-frequency
with nuclear, hydro and bioenergy balancing, lasting from a few

125 | bp Energy Outlook: 2020 edition

Net zero
126 |

Net-zero energy system: use of oil and natural gas

falls substantially
Oil consumption in IPCC Natural gas consumption in IPCC
scenarios and Net Zero scenarios and Net Zero
Mb/d Bcm

80 4000
IPCC range IPCC range

70 IPCC median 3500 IPCC median

60 3000 Non-combusted
2500 Combusted gas
50 without CCUS
Natural gas
40 2000 with CCUS
Blue hydrogen
30 1500 from gas

20 1000

10 500

0 0
IPPC at net zero Net Zero in 2050 IPPC at net zero Net Zero in 2050

Key points

The use of both oil and natural gas Outside of transport, most of the Natural gas consumption in the IPCC
in a net-zero energy system is likely remaining oil in Net Zero in 2050 is net-zero scenarios in 2050 varies
to decline substantially from current used in the non-combusted sector between 3800 Bcm – similar to
levels. for petrochemical feedstock and 2018 – and 1000 Bcm, a decline of
other industrial uses. Although this 75% from current levels. In Net Zero,
Oil consumption in the IPCC net- use of oil does not lead to carbon natural gas is around 2300 Bcm in
zero scenarios declines to between emissions at the point of use – since 2050 providing energy across all
70-10 Mb/d, around 30-90% below the oil is not combusted – the use the main sectors of the economy –
current levels. Oil consumption falls and ultimate end of life consumption either directly or via blue hydrogen.
to around 25 Mb/d in Net Zero by or disposal of the products which
2050, of which 10 Mb/d is used the oil is used to produce, such as By 2050, around three-quarters of
in the transport sector, mainly for plastics, may well generate carbon the natural gas which is combusted
long-distance transportation in emissions over their life cycle. And, in Net Zero is used in conjunction
trucking, aviation and marine. It is depending on how those activities with CCUS. This share is likely to
likely that this use in transport will are conducted, may also lead to grow further over time, either as
decline further over time, as legacy other environmental issues. This the build out of CCUS expands
vehicles and infrastructure are may put further pressure on oil use or alternative low or zero-carbon
increasingly replaced with alternative over time. energy sources become increasingly
technologies and energy sources. available and replace unabated
natural gas.

127 | bp Energy Outlook: 2020 edition

Net zero
128 |

Net-zero energy system: share of bioenergy

and hydrogen increases
Bioenergy in IPCC scenarios and Net Zero Hydrogen in IPCC scenarios and Net Zero

180 70
IPCC range IPCC range
160 IPCC median IPCC median
60 By sector By type
140 Hydrogen Power

Power 50 Buildings
Buildings Industry
100 40
Industry Transport
80 30
Transport Green
60 By sector By type Biomethane
20 Blue
Biomass hydrogen
Biofuels 10

0 0
IPCC at net zero Net Zero IPCC at net zero Net Zero
in 2050 in 2050

Key points

Bioenergy and hydrogen – alongside The use of bioenergy in a net-zero The versatility of hydrogen means it
electricity – are likely to play an energy system will depend on the is used in all sectors of the economy
increasing role in a net-zero energy cost and feasibility of producing in Net Zero by 2050, especially
system. bioenergy at scale, together with in high-temperature industrial
other environmental and social processes; long-distance road and
The use of bioenergy in the IPCC factors, such as the extent of marine transportation; and as a form
net-zero scenarios ranges from 40- competition with other land uses of storage and flexible energy source
155 EJ; this compares with around and its impact on biodiversity. in the power and buildings sectors.
55 EJ in Net Zero by 2050, where it
accounts for close to 10% of primary Hydrogen as an energy carrier The production of hydrogen in Net
energy. reaches around 60 EJ in Net Zero by Zero by 2050 is roughly even split
2050, providing around 15% of total between green and blue hydrogen
A little over half of the bioenergy final consumption (excluding the (see pp 104-105).
used in Net Zero is in the form of non-combusted use of fuels). This
biomass, which is mainly used as is at the top of the range of IPCC
a flexible feedstock in the power net-zero scenarios (15-60 EJ), which
sector and to fuel high-temperature may reflect that many of the IPCC
industrial processes. Biofuels scenarios were compiled before the
account for almost another 30%, increase in policy and private-sector
used largely in long-distance interest in hydrogen over the past
transportation, helped by their few years.
portability and high energy density.
The remainder is biomethane which
is consumed across all sectors as a
replacement for natural gas.

129 | bp Energy Outlook: 2020 edition

Net zero
130 |

Net-zero energy system: CCUS and negative emission

technologies play a significant role
Carbon captured in IPCC scenarios
and Net Zero CCUS by sector and fuel type in Net Zero in 2050
Gt of CO2 Gt of CO2

20 8
IPCC range 8
at net zero 7
IPCC median 6
15 at net zero 5
Net Zero 4
in 2050 Biomass
5 Coal
10 2
4 Natural
0 gas
5 by fuel

0 Industry

1 Hydrogen

-5 0
Carbon capture Bioenergy with Natural Emissions from CCUS Unabated
use and storage carbon capture climate combustion of fossil by sector emissions
use and storage solutions fuels before CCUS

Key points

Technologies which capture CCUS can be combined with hard-to-abate sources in the energy
carbon emissions or extract them bioenergy (BECCS) in the power system and the wider economy,
from the atmosphere are likely to and industrial sectors to create a such as agriculture, as well as any
play a material role in a net-zero negative-emissions energy source. overshoots in the carbon budget.
environment. In the IPCC net-zero scenarios, the
negative emissions produced using In particular, natural climate solutions
In the IPCC net-zero scenarios, the BECCS range from 5-10 Gt CO2. (NCS), which includes forest and
use of CCUS ranges between 8-18 Again, this is higher than in Net Zero, peat restoration and various forms
Gt CO2, which is roughly equivalent where the negative emissions from of enhanced land management,
to capturing and sequestering BECCS reach around 1.5 Gt CO2 by generate emissions savings in the
between a quarter and a half of 2050. IPCC net-zero scenarios ranging
all current carbon emissions from from -3 to +7 Gt CO2e (where the
energy use. This range is higher than There are a variety of other negative ‘negative saving’ reflect the risk
in Net Zero, where CCUS reaches a emission technologies (NETs). These that land use deteriorates over time
little over 5 Gt CO2 by 2050. technologies are not modelled adding to emissions).
explicitly in Net Zero which explores
Although CCUS facilities capture a a possible pathway in which There are other NETs, such as
vast majority of carbon emissions, the energy system almost fully direct air capture and biochar which,
current technologies don’t have a decarbonizes without significant use although not explicitly included in
100% capture rate. The average of NETs. Even so, these NETs may Net Zero, may also play a material
efficiency rate assumed in Net Zero play an increasingly important role as role in balancing total GHGs as the
is around 90%, implying residual the world seeks to reduce all GHG world moves to net zero.
carbon emissions from CCUS emissions to net zero, offsetting
operations of around 0.5 Gt CO2. any continuing emissions from

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Upstream oil and gas investment

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134 |

The energy transition requires significant shifts

in the pattern of investment
Average annual investment, history and 2020-2050 Average annual investment in wind and solar
2018 US$ Billion Five-year rolling average, 2018 US$ Billion

Business- Rapid
Wind & as-usual
1000 Net Zero
solar Rapid Business-
Net Zero as-usual
Business- 600
Oil & as-usual
gas Rapid

Net Zero 400

CCUS 200
Net Zero
0 100 200 300 400 500 600 700 800 900 2015 2018 2025 2030 2035 2040 2045 2050

Key points

The energy transition requires Zero is between $500-750bn. This The marked decline in oil and natural
significant levels of investment, with is two or three times greater than gas demand in Rapid and Net Zero
material shifts in the pattern of that recent levels of investment, although is reflected in a sharp slowing in the
investment across different energy is roughly equivalent to around only pace of upstream investment relative
sources. 3% of total business investment in to the past and is significantly lower
2018. BAU also implies an increase than the investment in wind and
Estimates of the investment paths in investment in wind and solar solar capacity implied by these
implied by different scenarios are capacity to around $300-400bn per scenarios. The pattern of investment
highly uncertain since they depend year. in oil and natural gas production in
on assumptions concerning a range the different scenarios is discussed
of factors that could affect the cost The hump-shaped pattern of wind in more detail on pages 136-137.
of energy investments over the and solar investment in Net Zero
next 30 years. The assumptions – reflecting the quick build-out of The level of investment required
underlying the estimated investment new capacity in the 2020s and 30s to support the build-out of CCUS
requirements are discussed in more before slowing markedly – may lead facilities is relatively small compared
detail on pp 152-153. Investment to issues of excess capacity in the to that required for wind and solar
estimates are in real $2018 prices. supply chain supporting this build- capacity and upstream oil and gas
out. production. This is the case even in
Rapid and Net Zero scenarios imply Rapid and Net Zero in which CCUS
a significant increase in investment capacity is increased substantially.
in wind and solar power capacity
relative to the past. The average
annual investment in wind and solar
capacity implied by Rapid and Net

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136 |

Significant investment in new oil and natural gas

production is still required
Consumption and production of oil Consumption and production of natural gas
Mb/d Bcm

120 6000

100 5000

80 4000

60 3000

40 2000
Rapid Rapid
Net Zero Net Zero
20 Business-as-usual 1000 Business-as-usual
Supply with no new Supply with no new
greenfield investment greenfield investment
0 0
1990 2000 2010 2020 2030 2040 2050 1990 2000 2010 2020 2030 2040 2050

Key points

Even though the demand for oil Closing the gap between these ‘no falls in the second half of Net Zero
and natural gas peaks and falls in new greenfield investment’ supply is faster than the natural decline rate
nearly all the scenarios, the faster profiles for oil and natural gas and of production, implying that some of
rate of decline in existing production the level of supply needed to meet these investments by 2050 may not
means that significant amounts of the demand profiles in the three be fully utilized and so may become
new upstream investment in oil and scenarios requires significant levels uneconomic.
natural gas production is required in of new investment in upstream
all three scenarios. oil and gas production, totalling This risk may be able to be mitigated
between $9 trillion and over $20 by investing in less capital intensive,
The scenarios are based on the trillion over the next 30 years. shorter-cycle, scalable projects, such
assumption that, if oil producers as unconventional tight oil and gas,
over the next 30 years invested only The profile of oil demand in Net Zero brownfield redevelopments and
in maintaining existing (brownfield) highlights the increasingly difficult subsea tiebacks.
sites, as well as completing projects judgements concerning future
that have already been sanctioned, investments in oil and gas as the The uncertainty about the speed and
this would imply an average decline world transition to a lower carbon nature of the energy transition, as
rate of oil production of a little above energy system. highlighted for example by Delayed
4% p.a., with global oil supplies and Disorderly, means the option
falling to around 25 Mb/d in 2050. The relative resilience of oil demand value associated with these types
The corresponding decline rate for during the first half of the Outlook in of projects could increase in
natural gas is assumed to be slightly Net Zero implies that several trillions coming years.
higher (4.5%), reflecting the greater of US dollars of new oil investment
proportion of natural gas production is needed over the next 15 years
that comes from short-cycle or so to ensure adequate supplies.
unconventional plays. But the pace at which oil demand

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Revisions to Rapid
Comparing Rapid with external Outlooks

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140 |

Main revisions to Rapid : lower energy demand and carbon

emissions; higher share of renewable energy
GDP, energy and
carbon emissions Shares of primary energy
% change in 2040 vs previous Outlook Percentage point change in 2040 vs previous Outlook

0% 5%


-8% 0%


-16% -5%
GDP Primary CO 2 Oil Gas Coal Nuclear Hydro Wind Bioenergy
energy & solar & other

Key points

Analysing how previous Outlooks Global GDP in Rapid is 8% lower in assumptions regarding the use of
have been revised over time helps 2040 than in last year’s RTS. This plastics (see pp 28-29, 44-45,
identify key developments that may largely reflects the impact from 38-39).
affect the future path of the energy Covid-19 and new assumptions
system. concerning the impact of climate The share of natural gas in primary
change on economic activity (see energy is also lower than in last
The modelling assumptions used pp 28-29, 148-149). The level of year’s RTS, squeezed by a more
in Rapid differ from those used in energy demand in 2040 in Rapid pronounced shift to renewable
last year’s Rapid Transition scenario is around 4% lower, reflecting the energy in power generation and a
(RTS) in two main respects. weaker profile for economic growth greater substitution by electricity and
First, Rapid includes a more partially offset by the increasing use hydrogen in industry.
comprehensive modelling of the role of secondary energy carriers such
that hydrogen and bioenergy may as electricity and hydrogen, whose The main counterpart is renewable
play in the energy transition. Second, production tends to boost primary energy, whose share of primary
Rapid embodies a faster pace of energy. energy in 2040 is 7 percentage
decarbonization, such that the level points higher than in last year’s
of carbon emissions from energy The largest downward revision is to RTS. This upwards revision is split
use in Rapid in 2040 are around oil, whose share of primary energy roughly equally between bioenergy
15% lower than in 2019’s RTS. in 2040 is 4 percentage points lower – reflecting this year’s more
The differences in Rapid relative to than in 2019’s RTS. This diminished comprehensive analysis of bioenergy
2019’s RTS reflect a combination of role for oil reflects the proportionally (see pp 128-129) – and wind & solar
these modelling changes as well as higher impact of Covid-19 on the power, supported by green hydrogen
the impact of recent developments. transport sector, faster penetration production as well as continuing falls
of electricity and hydrogen in in development costs.
transport, and more stringent policy

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Rapid is broadly in line with external outlooks,

although weaker oil and stronger natural gas
Growth in primary energy by source, 2018-2050 CO2 emissions and CCUS in 2050
% per annum Gt of CO2

10% 20
Range energy forecasters*
8% 18
Range IPCC 2˚C Scenarios (10-90 th percentile)
6% Median IPCC 2˚C Scenarios 16

4% Rapid 14

2% 12

0% 10

-2% 8

-4% 6

-6% 4

-8% 2

-10% 0
Primary Oil Gas Coal Nuclear Renewables CO 2 emissons CCUS
energy & hydro
*See pp 155 for more detail

Key points

It is also helpful to compare the many of the scenarios have not been The outlook for natural gas in Rapid
scenarios in the Energy Outlook updated since the pandemic, as well is towards the top end of both
with projections published by other as the assumed impact of climate scenario ranges, which may partly
organizations to highlight differences change on GDP growth in Rapid. reflect Rapid having a brighter
of view and areas of uncertainty. outlook for blue hydrogen than many
Rapid can be compared with a The comparative weakness of of the other scenarios.
sample of external outlooks which energy demand in Rapid is manifest
are broadly consistent with limiting in the profiles for oil and coal In terms of carbon emissions in
global temperature rises to ‘well consumption, where Rapid is at or 2050, Rapid is towards the low end
below 2oC’ as well as a range of towards the bottom of the range of of the range of external scenarios
corresponding IPCC scenarios (see both the external projections and the and in line with the median IPCC
pp 155 for details of the sample of IPCC scenarios. scenario. Within that, the use of
external outlooks and pp 150-151 for CCUS in Rapid is broadly in the
more details on the IPCC scenarios). As with Rapid, both sets of middle of the spread of external
comparator scenarios point to outlooks, although below the bottom
The average growth of primary renewable energy being the fastest of the range of IPCC scenarios
energy over the next 30 years in growing source of energy over the which embody a stronger view of
Rapid is towards the bottom end next 30 years, with the average the potential role of CCUS.
of the range of both the sample annual rate of growth of renewable
of external outlooks and the IPCC energy in Rapid broadly in line with
scenarios. This may partly reflect the median IPCC scenario.
the impact of Covid-19 on economic
activity and energy demand since

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Key figures, definitions, methodology and data sources

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Key figures Level in 2050 Shares of primary energy in 2018 and 2050 Change 2018 - 2050 (% p.a.)
2018 Rapid Net Zero BAU 2018 Rapid Net Zero BAU Rapid Net Zero BAU
Primary energy by fuel (EJ)
Total 576 625 625 725 100% 100% 100% 100% 0.3% 0.3% 0.7%
Oil 190 89 42 172 33% 14% 6.8% 24% -2.3% -4.6% -0.3%
Natural gas 138 134 81 187 24% 21% 13% 26% -0.1% -1.6% 0.9%
Coal 158 24 12 123 27% 3.9% 1.9% 17% -5.7% -7.8% -0.8%
Nuclear 24 44 57 31 4.2% 7.0% 9.1% 4.2% 1.9% 2.7% 0.7%
Hydro 38 57 62 51 6.5% 9.1% 9.9% 7.1% 1.3% 1.6% 1.0%
Renewables (incl. biofuels) 27 277 370 161 4.7% 44% 59% 22% 7.5% 8.5% 5.7%

Primary energy by sector

Transport^ 119 147 159 147 21% 24% 26% 20% 0.7% 0.9% 0.7%
Non-combusted^ 38 44 28 53 6.5% 7.1% 4.4% 7.3% 0.5% -1.0% 1.1%
Buildings^ 169 179 177 234 29% 29% 28% 32% 0.2% 0.1% 1.0%
Industry^ 250 254 261 291 43% 41% 42% 40% 0.1% 0.1% 0.5%
Of which:
Inputs to power 245 423 483 388 43% 68% 77% 54% 1.7% 2.2% 1.5%

Primary energy by region

Developed 240 179 186 218 42% 29% 30% 30% -0.9% -0.8% -0.3%
US 95 67 69 92 17% 11% 11% 13% -1.1% -1.0% -0.1%
EU 70 49 49 53 12% 7.8% 7.8% 7.3% -1.1% -1.1% -0.8%
Other 75 64 68 73 13% 10% 11% 10% -0.5% -0.3% -0.1%
Emerging 335 445 438 507 58% 71% 70% 70% 0.9% 0.8% 1.3%
China 136 141 139 155 24% 23% 22% 21% 0.1% 0.1% 0.4%
India 34 75 77 86 5.9% 12% 12% 12% 2.5% 2.6% 3.0%
Other Asia 41 66 68 76 7.1% 11% 11% 11% 1.5% 1.6% 2.0%
Middle East 38 40 31 53 6.6% 6.5% 5.0% 7.3% 0.2% -0.6% 1.1%
Russia 30 27 28 30 5.2% 4.2% 4.5% 4.1% -0.4% -0.2% 0.0%
Brazil 12 20 20 20 2.1% 3.2% 3.1% 2.8% 1.5% 1.5% 1.6%
Other 45 76 75 87 7.8% 12% 12% 12% 1.7% 1.6% 2.1%

Level in 2050 Change 2018 - 2050 (% p.a.)

2018 Rapid Net Zero BAU Rapid Net Zero BAU
Primary energy by
fuel (native units)
Oil (Mb/d) 97 47 24 89 -2.2% -4.2% -0.3%
Natural gas (Bcm) 3845 3708 2263 5199 -0.1% -1.6% 0.9%

Oil (Mb/d) 97 47 88 -2.2% -0.3%
Natural gas (Bcm) 3865 3717 5200 -0.1% 0.9%
Coal (EJ) 165 30 120 -5.2% -1.0%

GDP (trillion US$ PPP) 129 297 297 297 2.6% 2.6% 2.6%
Population (billions) 7.6 9.7 9.7 9.7 0.8% 0.8% 0.8%
GDP per capita (thousand US$) 17 31 31 31 1.9% 1.9% 1.9%
Energy intensity (MJ per US$ of GDP) 4.5 2.1 2.1 2.4 -2.3% -2.3% -1.9%
Net CO2 emissions (Gt) 33.8 9.4 1.4 30.5 -3.9% -9.4% -0.3%

EJ = exajoules
Includes electricity and hydrogen; and their associated conversion losses.

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Estimates of climate change on GDP growth

This year’s Energy Outlook attempts analyses the economic impact of carbon emissions from energy use in
to account explicitly for the impact climate change based on estimates each of the scenarios. For Rapid this is
of climate change on economic of how past changes in temperature RCP 2.6; Net Zero – RCP 1.9; and BAU
activity as well as the mitigation costs in different parts of the world have – RCP 4.5. The economic impacts
associated with decarbonizing the affected GDP. One of the benchmark from these implied temperature
energy system. There is considerable studies of this literature, Burke et al. increases are computed relative to
uncertainty in the economic and (2015) uses the IPCC Representative a counterfactual scenario, in which
scientific literature as to how to Concentration Pathways (RCP) future temperatures are assumed to
model these impacts and so any scenarios to assess the non-linear be held constant at recent (1980-2010)
estimates of these effects, including impact of temperature changes on average levels.
those contained in the Outlook, GDP across 166 countries. They find
are imperfect and almost certainly that GDP per capita is a concave The median climatic change impacts
incomplete. That said, we have judged function of temperature, peaking at an derived using Burke’s methodology
that it is better to use the research that annual average temperature of 13°C suggest that, for BAU, the implied
is available than to make no attempt to and declining strongly at higher levels. increase in global temperatures would
include it in our analysis. decrease global GDP by close to 5%
The illustrative estimates of the by 2050. The estimated impacts for
The economic literature on climate impact from climate change on GDP Rapid and Net Zero are somewhat
change has traditionally quantified contained in the Outlook are based smaller, reflecting the lower path
the relationship between climate on the models from Burke et al. The of carbon emissions. The regional
change effects and economic activity assumed temperature profiles implied impacts are distributed according to
using climate-economy integrated by the three main scenarios are based the evolution of their temperatures
assessment models (IAMs). A more on the RCP scenario which most relative to the concave function
recent strand of empirical literature closely approximate the trajectories for estimated by Burke et al. Regions that

are already relatively warm are likely to IPCC (AR5 – Chapter 6) suggest that References
experience negative impacts on GDP, for scenarios consistent with keeping Burke, M., Hsiang, S. & Miguel, E.
while colder regions could potentially global temperatures increases to Global non-linear effect of temperature
benefit from relatively warmer well below 2°C, median estimates of on economic production. Nature 527,
weather. mitigation costs range between 2-6% 235–239 (2015)
of global consumption by 2050.
These climate change impacts are The global aggregate mitigation cost
hugely uncertain and incomplete as Given the huge range of uncertainty estimates in terms of GDP losses
the Burke et al framework focuses surrounding estimates of the are taken from IPCC AR5 – Chapter
only on temperature changes on GDP, economic impact of both climate 6:
and does not incorporate other climate changes and mitigation, and the fact uploads/2018/02/ipcc_wg3_ar5_
change effects (such as rising sea that all three of the main scenarios chapter6.pdf
levels, more frequent and stronger include both types of costs to a
storms, floods, droughts or loss greater or lesser extent, the Outlook
of biodiversity) or other sources of is based on the illustrative assumption
economic disruption, such as large- that these effects reduce GDP in 2050
scale human migration. by around 5% in all three scenarios,
relative to the counterfactual in which
The mitigation costs of actions to temperatures are held constant at
decarbonize the energy system are recent average levels.
also very uncertain, with significant
variations across different external Importantly, if the scenarios were
estimates. Most estimates, however, extrapolated beyond 2050, the Burke
suggests that these costs increase methodology would imply GDP
with the stringency of the mitigation growth and prosperity in BAU would
effort, suggesting that they are likely to get progressively worse, leading to
be bigger in Rapid and Net Zero, than significantly lower levels of well-being
in BAU. Estimates published by the than in Rapid and Net Zero.

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Construction of IPCC scenario sample ranges

The world’s scientific community has frameworks were compiled and made For each of these two subsets of
developed a number of “integrated available via an online portal (https:// scenarios, the ranges of outcomes for
assessment models” (IAMs) that key variables are described in terms of
attempt to represent interactions medians and percentile distributions.
between human systems (the Some of the scenarios are now quite
economy, energy, agriculture) and dated and, in some cases, scenario It is important to note that the scenario
climate. They are “simplified, stylized, results are already significantly out dataset represents “an ensemble of
numerical approaches to represent of line with recent historical data and opportunity” – a collection of scenarios
enormously complex physical and so were excluded from our analysis. that were available at the time of the
social systems” (Clarke 2014). These From the remaining model runs, we IPCC survey and which were produced
models have been used to generate a extracted 112 scenarios that were for a variety of purposes. “It is not a
large number of scenarios, exploring judged to be consistent with the Paris random sampling of future possibilities
possible long-run trajectories for GHG Agreement Long Term Temperature of how the world economy should
emissions and climatic changes under Goal. They were further divided into decarbonise” (Gambhir et al, 2019).
a wide range of assumptions. two subsets: “well below 2°C” (69 That means that the distributions of
scenarios); and “1.5°C with no or low IPCC scenarios cannot be interpreted
The Intergovernmental Panel on overshoot” (43 scenarios). A more as reliable indicators of likelihood of
Climate Change (IPCC) carries out detailed note on the scenario selection what might actually happen. Rather,
regular surveys of this scenario methodology is available at www. the distributions simply describe
modelling as part of its assessment For each of the characteristics of the scenarios
work. The most recent survey was these two subsets of scenarios, the contained in the IPCC Report.
carried out in support of the 2019 IPCC ranges of outcomes for key variables
Special Report on Global Warming are described in terms of medians and
of 1.5°C (SR15). A total of 414 percentile distributions.
scenarios from 13 different modelling

The sample ranges included in the References

section ‘Global energy system at net Clarke L. et al (2014). Assessing
zero’ (see pp 119-131), are based on Transformation Pathways. In: Climate
those IPCC scenarios in our sample Change 2014: Mitigation of Climate
which embody net carbon emissions Change. Contribution of Working
from energy and industrial use falling Group III to the Fifth Assessment
below 1 Gt before 2100. This was the Report of the Intergovernmental Panel
case for 84 of the scenarios from the on Climate Change
sample of 112 scenarios. For each of
these scenarios, the size and structure Gambhir A. et al (2019). Energy
of the energy system is considered at system changes in 1.5 °C, well below
the point at which carbon emissions 2 °C and 2 °C scenarios Energy
fall below the 1 Gt threshold. The Strategy Reviews 23
earliest point at which this ‘net zero’
state is reached in the sample of
scenarios is around 2045 and the
median scenario in 2070.

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Estimate of investment profiles

This year’s Energy Outlook includes estimated at 4.3% p.a. and 4.8% p.a., A set of non-producing, unsanctioned,
estimates of the investment respectively. When including fields dispatchable assets needed to meet
requirements implied for each of the that have already been sanctioned, the the oil and gas shortfalls in our three
three main scenarios for upstream decline rate is mitigated to 4.1% p.a. main demand scenarios is defined.
oil and natural gas, renewables and and 4.5% p.a., respectively. Based on Rystad data, the asset-level
carbon capture use and storage investments required to bring those
(CCUS). The hypothetical supply baselines assets online are estimated. Finally,
for oil and natural gas assume that the capital spending on new assets is
Oil and gas investment no new investment is undertaken in added to the capex of the producing
Upstream oil and natural gas capital new fields beginning with the 2020 and under development assets.
expenditure (excluding operating costs) supply baseline. It assumes that Investment in producing and under
profiles in each of the three main continuous investment at producing development assets are assumed to
scenarios are calculated based on the and sanctioned fields takes place be equal in all scenarios.
investment required at an individual including infill wells and costs related
asset level to meet the shortfall to maintaining the facility. Additionally,
between estimates of the demand for projects that have already been
oil and natural gas and a hypothetical sanctioned (up to almost 7 Mb/d by
supply of oil and natural gas where no 2025 and 400 Bcm by 2027 for oil and
new investment is undertaken in new natural gas, respectively) are assumed
fields. Both the asset-level database to be completed in the next few years.
and decline rates are derived from
Rystad. The average base decline rate
up to 2050 for oil and natural gas is

Investment in wind and solar The total investment in CCUS is based

energy, and CCUS on deployment and costs. These
also include variables costs and, in
For wind and solar energy, the particular, the cost of transportation
deployment rate of each technology and storage of carbon emissions
in each scenario is estimated. which vary between regions and over
Investment costs are assigned to each time.
based on their historical costs and
learning curves. The investment costs References
of solar and wind energy are broadly Rystad Energy’s UCube global
aligned with their historical learning upstream database, August 2020
curves, around 8% for wind and 20%
for solar.

For carbon capture and storage, the

cost of investment in 2018 for different
technologies – iron & steel, cement,
hydrogen, power sector, chemical
sector, fertilizers – is taken from a
range of sources. It is assumed that
the investment costs decline over time
as a reflection of technology progress.
The annual investment cost reduction
varies from a minimum of 1.3% to a
maximum of 1.9%, depending on the

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154 |

Definitions and data sources

Data assumption that efficiency will Non-combusted includes fuel that
increase linearly to 45% by 2050. is used as a feedstock to create
Unless noted otherwise, data For more information see https:// materials such as petrochemicals,
definitions are based on the BP lubricant and bitumen
Statistical Review of World Energy business-sites/en/global/corporate/
Buildings includes energy used in
All comparison data, including pdfs/energy-economics/statistical-
residential and commercial building,
scenarios from IPCC and other review/methodology-for-converting-
plus agriculture, fishing and IEA’s
energy forecasters, have been non-fossil-fuel-primary-energy.pdf
non-specified sector “Other”
rebased to be consistent with the bp Gross Domestic Product (GDP)
Statistical Review Power includes inputs into power
is expressed in terms of real
generation (including combined heat
Primary energy comprises Purchasing Power Parity (PPP) at
and power plants)
commercially-traded fuels, and 2015 prices
excludes traditional biomass Regions
The primary energy values of OECD is approximated as North
nuclear, hydro and electricity from Transport includes energy used in
America plus Europe plus OECD
renewable sources have been road, marine, rail and aviation
derived by calculating the equivalent Industry includes energy combusted
amount of fossil fuel required to China refers to the Chinese Mainland
in manufacturing; construction; the
generate the same volume of energy industry including pipeline Other Asia includes all countries and
electricity in a thermal power station, transport; and for transformation regions in non-OECD Asia excluding
the thermal efficiency assumption processes outside of power mainland China and India
is time varying, with the simplified generation

Fuels, energy carriers, biomethane Other key data sources

carbon and materials
References to carbon emissions BP p.l.c., bp Statistical Review of
Oil unless noted otherwise includes: consider only CO2 emissions from World Energy, London, United
crude (including shale oil and oil fuel combustion Kingdom, June 2019
sands); natural gas liquids (NGLs); Plastics includes synthetic fibres International Energy Agency, Energy
gas-to-liquids (GTLs); coal-to-liquids
Balances of Non-OECD Countries,
(CTLs); condensates; and refinery Data sources used to
Paris, France, 2019
gains compare with Rapid
International Energy Agency, Energy
Liquids includes all of oil plus Equinor: Renewal Scenario, Energy Balances of OECD Countries, Paris,
biofuels Perspectives 2019, June 2019 France, 2019
Renewables unless otherwise noted IEA: Sustainable Development United Nations, Department of
includes wind, solar, geothermal, Scenario, International Energy Economic and Social Affairs,
biomass, biomethane and biofuels Agency, World Energy Outlook 2019, Population Division (2019). World
and excludes large-scale hydro Paris, France, November 2019 Population Prospects 2019, Online
Non-fossils includes renewables, IHS Markit: Accelerated Carbon Edition. Rev. 1
nuclear and hydro Capture and Storage and Multitech
Hydrogen demand includes its Mitigation: IHS Markit 2020 low
consumption in transport, industry, emission cases, January 2020
buildings and power, but does Shell: Sky Scenario, February 2018
not include the demand as a non-
combusted feedstock (such as use
for fertilizer or methanol production)
Gas includes natural gas and

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156 |

This publication contains forward-looking including the impact of climate change and acts of terrorism or sabotage; public
statements – that is, statements related to on this, population growth, demand for health situations including the impacts
future, not past events and circumstances. passenger and commercial transportation, of an epidemic or pandemic and other
These statements may generally, but energy markets, energy efficiency, policy factors discussed in this publication. bp
not always, be identified by the use of measures and support for renewable disclaims any obligation to update this
words such as ‘will’, ‘expects, ‘is expected energies and other lower-carbon publication or to correct any inaccuracies
to’, ‘aims’, ‘should’, ‘may’, ‘objective’, ‘is alternatives, sources of energy supply and which may become apparent. Neither BP
likely to’, ‘intends’, ‘believes’, anticipates, production, technological developments, p.l.c. nor any of its subsidiaries (nor any of
‘plans’, ‘we see’ or similar expressions. trade disputes, sanctions and other their respective officers, employees and
In particular, the following, among other matters that may impact energy security, agents) accept liability for any inaccuracies
statements, are all forward looking in and the growth of carbon emissions. or omissions or for any direct, indirect,
nature: statements regarding the global Forward-looking statements involve risks special, consequential or other losses
energy transition, increasing prosperity and and uncertainties because they relate to or damages of whatsoever kind in or in
living standards in the developing world events, and depend on circumstances, connection with this publication or any
and emerging economies, expansion that will or may occur in the future. Actual information contained in it.
of the circular economy, urbanization outcomes may differ materially from
and increasing industrialization and those expressed in such statements Acknowledgements
productivity, energy demand, consumption depending on a variety of factors, Data compilation: Centre for Energy
and access, impacts of the Coronavirus including: the specific factors identified Economics Research and Policy
pandemic, the global fuel mix including in the discussions expressed in such
its composition and how that may change statements; product supply, demand and Heriot-Watt University
over time and in different pathways or pricing; political stability; general economic
scenarios, the global energy system conditions; demographic changes; legal
including different pathways and scenarios and regulatory developments; availability
and how it may be restructured, societal of new technologies; natural disasters
preferences, global economic growth and adverse weather conditions; wars

157 | bp Energy Outlook: 2020 edition

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