Scarce Resources of Fossil Fuels

Summary

Driver description
Interactions with the Environment Domain
Interactions within the Social Domain
Interactions with the Economy Domain
Interactions with the Technology Domain
Impacts on Mobility and Transport

Driver description

  • “Most of the changes in the state of the environment (...) are ultimately driven by unsustainable consumption and production patterns. These have resulted in unprecedented levels of greenhouse gas emissions and the depletion of renewable environmental resources, such as clean water and fish stocks, as well as non‑renewable ones, such as fossil fuels and raw materials.” (Ref: CO_0141)
  • “(...) we may soon run short of the fossil fuels (gas and oil) which keep modern society going. Not only do they provide heat, light and electricity. Agriculture, pharmaceuticals, communications and most of the other features of life we take for granted depend on the reserves of fossil fuels, directly (e.g. for plastics) or indirectly.” (Ref: CO_0091)
  • “Fossil fuel reserves are concentrated in a small number of countries. Some 80 % of the coal reserves are located in just six countries and the EU has just 4 % of the global total. The EU share of the world's reserves decreased from 4.6 % in 1980 to 1.3 % in 2009 and these reserves are expected to be exhausted before 2030. More than half of the global stock is found in only three countries: Iran, Qatar and Russia, which accounted for 24 % of the total in 2009 and is a major gas supplier for the EU.” (Ref: CO_0274)
  • “Oil is one of the most threatened, and increasingly difficult to access, resources in the world.” (Ref: CO_5018)
  • “Oil production has long been expected to peak. Some think that this is now imminent at least within the next 10 years. For others the scarcity of oil supplies, including unconventional sources and natural gas liquids, is very unlikely before 2025. This horizon could be extended to 2040 by adopting known measures to increase vehicle efficiency and focusing oil demand on the transport sector.” (Ref: CO_5048)
  • “Even though we cannot say with certainty that we will run out in the next thirty years, extracting and delivering the remaining oil to market is becoming increasingly difficult.” (Ref: CO_5018)
  • “Gas resource uncertainty is significant. Scarcity could occur as early as 2025, or well after 2050. Gas is considered by many to be scarcer than oil (WETO-H2, 2006), constraining expansion. But the key issue is whether there can be timely development of the infrastructure to transport remote gas economically.” (Ref: CO_5048)
  • “Some economists believe that the scarcer and more expensive a commodity becomes, the more effort will go into finding it, and that the market will ensure plentiful supplies of fossil fuel for many years ahead. But there are rational grounds for thinking we risk the exhaustion of recoverable reserves of oil and gas as well as an unpredictably warmer Earth if we do not kick the CO2 habit.” (Ref: CO_0091)
  • “(...) both on the supply and demand sides point to a bright future, even a golden age, for natural gas.” (Ref: CO_0152)

Interactions within the Environment Domain

Climate change

  • “The different studies seem to concur in identifying agriculture and food consumption, as well as the use of fossil fuels among the most important drivers of environmental pressures.” (Ref: CO_0135)
  • “As Europe uses up reserves that are easy to access, it will have to rely more on less concentrated ores, less accessible resources and fossil fuels with lower energy content, which are expected to cause higher environmental impacts per unit of material or energy produced.” (Ref: CO_0141)
  • “(...) fossil fuels that we now extract from deposits (...) would have been considered uneconomic two decades ago. All this also requires more transport and more energy and there is a clear — if rarely acknowledged — problem: all this extra energy use will accelerate climate change.” (Ref: CO_0135)
  • “The main sources of man-made GHG emissions globally are the burning of fossil fuels for electricity generation, transport, industry and households — which together account for about two-thirds of total global emissions.” (Ref: CO_0141)
  • “Natural gas is the cleanest of the fossil fuels, but increased use of gas in itself (without carbon capture and storage) will not be enough to put us on a carbon emissions path consistent with limiting the rise in average global temperatures to 2°C.” (Ref: CO_0152)

GHG mitigation

  • “The role of bioenergy systems in reducing GHG emissions needs to be evaluated by comparison with the energy systems they replace using life-cycle assessment (LCA) methodology. A number of such analysis methodologies have been developed (...).” (Ref: CO_5032)
  • “Figure below is based on a number of “well-to-wheel” LCA studies that compare the GHG emissions associated with different biofuels against the replaced fossil fuel. The figure covers mature, emerging and innovative processes. The data show a large range for each biofuel, depending on the details of the process and way the feedstock is produced, including the amount of fertilisers used.” (Ref: CO_5032)
Figure 1‑71 Life-cycle GHG balance of different conventional and advanced biofuels and current state technology

 

Source: Technology Roadmap Biofuels for Transport (Ref: CO_5032)

  • “Concerns have been raised that the GHG benefits of producing and using biofuels can be reduced or negated by carbon emissions associated with land-use change (LUC).” (Ref: CO_5032)
  • “When biofuel production involves a change in land use then there may be additional emission impacts – positive or negative – that must be taken into account in calculating the GHG balance. The land-use change can be: direct, as when biofuels feedstocks are grown on land that was previously forest; indirect, when biofuel production displaces the production of other commodities, which are then produced on land converted elsewhere (perhaps in another region or country).” (Ref: CO_5032)
  • “For biofuels to provide the envisaged emission reductions in the transport sector, it is essential to avoid large releases of GHG caused by land-use changes. However, emissions related to current biofuel production generate only around 1% of the total emissions caused by land-use change globally (Berndes et al., 2010), most of which are produced by changes in land use for food and fodder production, or other reasons.” (Ref: CO_5032)
  • “The European Union has introduced regulations under the Renewable Energy Directive (RED) that lay down sustainability criteria that biofuels must meet before being eligible to contribute to the binding national targets that each member state must attain by 2020 (EC, 2009). In order to count towards the RED target, biofuels must provide 35% GHG emissions saving compared to fossil fuels. This threshold will rise to 50% as of 2017, and to 60% as of 2018 for new plants.” (Ref: CO_5032)
  • “Not all biofuels in the market today, however, can actually reduce GHGs on the scale needed to meet the targets in the 2DS[1]. Improving the efficiency of conventional fuels, and commercially deploying advanced biofuels, will clearly still be required.” (Ref: CO_0185)
  • “Switching from fossil fuels to public electricity as an energy source, both for industrial users and for households, results in a transfer of the emissions linked to electricity or heat use from these sectors to the energy supply sector.” (Ref: CO_0200)

[1] ETP (Energy Technology Perspectives) 2012 2°C Scenario

Emission trading schemes

  • “(...) emissions from fossil fuel power plants are covered in (...) ETS sector.” (Ref: CO_0131)

Pollution levels and emissions standards

  • “CO2 emissions are almost entirely produced by burning fossil fuels, which is also an important source of several air pollutants.” (Ref: CO_0227)

Energy availability, production and consumption

  • “Fossil fuels are the source of 66% of global public electricity production. The share in OECD countries is slightly lower at 61%, while in developing and transition countries it averages 72%. The share of electricity production from fossil fuels in individual countries varies considerably. Countries with a high share of fossil fuel use for public electricity production include Poland (98%), South Africa (94%), Luxembourg (93%), Australia (93%), Ireland (93%), Greece (89%), the Netherlands (89%), Portugal (84%), Italy (83%), China (82%) and India (80%). The 20 countries shown in Figure below account for 80% of current global electricity production from fossil fuels (coal, oil and natural gas). The United States and China have by far the highest absolute levels of fossil-fuelled electricity production, together accounting for 44% of the global total. Many OECD countries also have significant electricity production from fossil fuels, as do Russia, India and South Africa. Globally, most fossil-fuelled electricity production is from coal (63%), followed by natural gas (29%) and oil (9%).” (Ref: CO_0183)
Figure 1‑72 Electricity Production by Fossil Fuels in Public Electricity and CHP[1] Plants, 2005

[1] Combined heat and power

 

Source: Worldwide Trends in Energy Use and Efficiency (Ref: CO_0183)

  • “We also need to think about what a low-carbon energy mix will mean for comprehensive energy security. On the one hand, reduced dependence on imported fossil fuels and broader development of alternative energy sources can help alleviate some of the current concerns around security of supply for these fuels. Yet as the demand for decarbonised electricity and also for biofuels increases, so new challenges will no doubt emerge requiring innovative policies to ensure that we have the affordable and reliable energy supplies that we need.” (Ref: CO_0153)

Interactions with the Social Domain

Urbanisation

  • “Rural land use is shaped by increasing global food consumption that stimulates production, and the shift to biomass resources to replace fossil fuels in energy generation and for the chemical industry.” (Ref: CO_0132)
  • “The EU target for 2030 is to cut the number of fossil-fuelled vehicles in urban areas by half and to phase out these vehicles by 2050. CO2-free transport and logistics in large cities is the target for 2030.” (Ref: CO_0234)

Tourist flows

  • “The majority of tourism trips that are undertaken worldwide entail the use of oil at some point, and many of these trips could not be undertaken by using alternative fuel sources, such as electricity derived from renewable power sources, with current technologies. There are means, however, for tourists to switch away from oil, and in the event of extreme oil price rises it would be inevitable that some would take this course of action.” (Ref: CO_4010)

Interactions with the Economy Domain

GDP trends

  • “More efficient use of resources and pollution control can be major drivers of economic growth, as is shown by Europe’s eco-industry. The sector has grown by around 8% per annum in recent years, and its annual turnover of €319 billion accounts for about 2.5% of Europe’s GDP.” (Ref: CO_0243)

Employment

  • “Substitution of employment will take place, for example due to shifting from fossil fuels to renewable energy sources (...)” (Ref: CO_0126)

Regional differences in economics

  • “We expect to experience a marked shift in transport fuel demand from the developed countries to the developing ones, mostly China and India.” (Ref: CO_0159)
  • “All of the net increase in oil demand comes from the transport sector in emerging economies, as economic growth pushes up demand for personal mobility and freight. Oil demand (excluding biofuels) rises from 87 million barrels per day (mb/d) in 2010 to 99 mb/d in 2035.” (Ref: CO_0152)
  • “Insufficient development of biofuel infrastructure – including feedstock supply, conversion and end-use related infrastructure, can form a non-economic barrier to the growing biofuel production envisioned (...). In developing countries, in particular, poor rural infrastructure may form a barrier to feedstock supply and fuel transport. Infrastructure should best be developed as part of an overall land use and rural development strategy that helps to attract urgently needed investments in agricultural infrastructure and promote overall rural development.” (Ref: CO_5032)
  • “Biofuels tend to be regional phenomena, mostly concentrated in the Americas, with sugar cane biofuels being dominant in Brazil and corn ethanol being the dominant biofuel in United States.” (Ref: CO_0159)

Availability of public and private resources and investments in the transport sector

  • “The total cost of biofuel use to 2030 is projected to be around USD 2.5 trillion (low-cost scenario) to USD 2.9 trillion (high-cost scenario) (...). Total expenditures on transport fuels, by contrast, are estimated at USD 43 trillion to 44 trillion between 2010 and 2030. Thus, the total expenditure on biofuels accounts for roughly 6% to 7% of all transport fuel spending. After 2030, biofuel production ramps up considerably and the total cost of biofuels from 2030 to 2050 is projected to be about USD 8.2 trillion (low-cost scenario) to USD 9.9 trillion (high-cost scenario) (...). The total cost of transport fuels is between USD 58 trillion and USD 61 trillion – thus biofuels account for about 14% to 16% of spending on transport fuels (Figure below).” (Ref: CO_5032)
Figure 1‑73 Total cost for all transport fuels production (high-cost scenario)

 

 

Source: Technology Roadmap Biofuels for Transport (Ref: CO_5032)

  • “For all biofuels, there is scope for cost reductions that will help to improve competitiveness with fossil fuels and drive commercial deployment: capital costs are expected to come down as a result of scaling up (particularly for advanced biofuels). Co-location with existing biofuel plants, power plants or other industrial facilities reduces capital costs and can bring further benefits such as more efficient use of by-products; conversion costs can be brought down through scaling up and technology learning. Further improvement of conversion efficiency (e.g. through more efficient enzymes) and energy efficiency should also help to reduce costs; feedstock costs cannot be predicted and are subject to agricultural commodity prices, oil prices and other factors. Enhancing feedstock flexibility will create access to a broader range of biomass sources with potentially low costs (such as residues) and reduced price volatility. Improving and creating transport infrastructure could further reduce biomass supply costs.” (Ref: CO_5032)
  • “Although some low-carbon and energy-efficient technologies are competitive today, many others are considerably more expensive than their fossil-based alternatives. Carbon pricing will be important in helping to redress this gap, but it will not be sufficient on its own. To avoid the lock-in of high-emitting, inefficient technologies during the next decade, governments will need to intervene on an unprecedented level with targeted technology policies to address the cost-competitiveness gap.” (Ref: CO_0154)
  • “Scale and efficiency improvements will reduce biofuel production costs over time. In a low-cost scenario, most biofuels could be competitive with fossil fuels by 2030. In a scenario in which production costs are strongly coupled to oil prices, they would remain slightly more expensive than fossil fuels.” (Ref: CO_5032)
  • “There is an urgent need to scale up investment in low-carbon energy technologies. Current investment levels are insufficient to make the necessary transition to a lowcarbon energy system. Investment in traditional fossil-based technologies needs to be shifted towards low-carbon energy technologies.” (Ref: CO_0154)

Intensified competition for scarce resources use

  • “Economic growth is continuing globally and is accelerating in BRIC countries and other newly emerging economies. Demand for fossil fuels and other subsoil and natural resources is likely to grow in absolute terms despite continuing and partly successful efforts to increase the resource- and energy-efficiency of economic activities.” (Ref: CO_0274)
  • “Ten countries (of which eight are OPEC members) have 80 % of the world's oil reserves. Some of these countries may exercise their power to restrict supply or influence the price (NIC, 2008). EU dependence on imported fossil fuels — currently accounting for over 50 % of fuels consumed — is slowly rising.” (Ref: CO_0274)
  • “A key non-economic barrier to development of biofuels is uncertainty regarding their sustainability. The sometimes controversial public debate on competition with food production and the potential destruction of valuable ecosystems has put biofuels in the centre of a sustainability discussion that concerns all forms of bioenergy and which (in parts) is relevant to the entire agricultural and forestry sector.” (Ref: CO_5032)

Fiscal policy

  • “(...) inefficient fossil fuel subsidies must be removed, while ensuring that all citizens have access to affordable energy. In 2010, fossil fuel subsidies were estimated at USD 409 billion (up more than 37% from 2009), against the USD 66 billion allotted for renewable energy support.” (Ref: CO_0185)
  • “A taxation system based on the environmental and energy performance of individual fuel types, including a carbon tax (as is already the case in Sweden) is one way of placing value on biofuels’ environmental and societal contribution, and of reducing gaps in competitiveness with fossil fuels.” (Ref: CO_5032)
  • “The economics of conversion processes need to be further improved for biofuels to be competitive with fossil fuels without subsidies in the longer term (given sound policy framework conditions, including CO2 emission pricing). As a first step, fossil fuel subsidies, which are still applied in many countries (...), should be phased out. Introducing a CO2 price through a global carbon market will be an important element in fostering the deployment of biofuels and other low-carbon technologies in the longer term and would help considerably to improve their competitiveness.” (Ref: CO_5032)
  • “The support requirements for conventional biofuels differ from those of advanced biofuels, which are in an earlier stage of technology development and still subject to comparably high production costs.” (Ref: CO_5032)

Interactions with the Technology Domain

Traction technologies

  • “One of the most important tasks facing the world today is the need to reduce its dependence on oil and other fossil fuels.(...). In response, car manufacturers around the world are focusing intensely on developing prototype electric vehicles. China, for example, has set a target that 50% of new vehicles on its roads should be electric by 2020.” (Ref: CO_0258)
  • “As oil becomes more scarce, expensive and a security risk, we need implement greater energy efficiency measures, and shift the way we power our vehicles from petrol to renewable, low carbon fuel sources.” (Ref: CO_5018)
  • “Fuel carbon intensity can be reduced by switching to, or blending in, lower-carbon alternative fuels (including biofuels, hydrogen, or electricity).” (Ref: CO_5046)
  • “Scale and efficiency improvements will reduce biofuel production costs over time. In a low-cost scenario, most biofuels could be competitive with fossil fuels by 2030. In a scenario in which production costs are strongly coupled to oil prices, they would remain slightly more expensive than fossil fuels.” (Ref: CO_5032)
  • “While improving vehicle efficiency is by far the most important low-cost way of reducing CO2 emissions in the transport sector, biofuels will need to play a significant role in replacing liquid fossil fuels suitable for planes, marine vessels and other heavy transport modes that cannot be electrified.” (Ref: CO_5032)

Renewable energy production

  • “Renewable energy sources are important for cutting greenhouse gas emissions and reducing the EU’s dependence on imported fossil fuels.” (Ref: CO_0197)

Energy efficiency

  • “We are reducing our reliance on fossil fuels by increasing energy efficiency and developing alternatives.” (Ref: CO_0195)
  • “Despite significant efficiency improvements, fossil fuel combustion continues to increase.” (Ref: CO_0140)

Impacts on Mobility and Transport

Breaking the dependence on fossil fuels will be the major challenge in the future

  •  “(Transport) is the fastest growing sector in terms of energy use, with the strongest reliance on fossil fuel.” (Ref: CO_0198)
  • “Transport depends heavily on fossil fuels (96% of all transport uses fossil fuels).” (Ref: CO_0237)
  • “Global transport will remain heavily dependent on fossil fuels with a strong rise in demand for diesel, fuel oil and jet fuel compared to gasoline. This will have potentially significant implications for refiners and the downstream sector as a whole, especially in Europe, where there is a large emphasis on diesel fuels.” (Ref: CO_0159)
  • “(...) the challenge is to break the transport system’s dependency on fossil fuels without sacrificing efficiency and compromising mobility.” (Ref: CO_0234)
  • “Reduction in oil dependence is an objective of EU policy, not least because it is closely related to decreasing GHG emissions. Targets and measures (...) for moving to a competitive low-carbon economy in 2050 require efforts from all sectors. Although the new white paper has not stated any specific target for reducing oil dependency, the 60 % GHG emissions reduction target means that transport-sector oil dependence should be significantly reduced by 2050, compared with the 96 % level today. In addition, decarbonisation of the energy system is significantly linked with decarbonisation of transport.” (Ref: CO_5030)

..but growing demand for fuel, especially for diesel is still expected

  • “Between 2010 and 2050, total fuel demand in all transport modes will increase by 30%-82% over 2010 levels. This growth is mainly driven by trucks, buses, trains, ships, and airplanes: demand for these forms of transport is expected to increase by 64%-200%..(...) In addition, the transportation sector will still depend heavily on gasoline, diesel, and jet fuel, since they all constitute the bulk of transport market fuels (80%–88%).” (Ref: CO_0159)
  • “The global demand increase for diesel is largely driven by demand from the heavy transport, agriculture, and mining sectors. In these segments replacement of conventional fuels with new types of fuel technologies is unlikely to occur prior to 2050. The same holds true for fuel oil in shipping and jet fuel for aviation.” (Ref: CO_0159)

Biofuels will have an exponential growth

  • “In transport, a mix of several alternative fuels will be needed to replace oil, with specific requirements of the different modes.” (Ref: CO_0245)
  • “(...) vehicles fuelled with biodiesel or biogas show the greatest promise in the short term for medium and long-distance journeys.” (Ref: CO_0234)
  • “Biofuels’ (…) use will increase almost four-fold. The demand for other fuels (electricity, hydrogen, CNG, and methanol) will increase six- to seven-fold.” (Ref: CO_0159)
  • “The maximum level of biofuels in the liquids markets is expected to be around four times above current market levels. Water and land use restrictions will prevent much further growth. The use of biofuels in Europe is largely a result of government mandates. As for the alternative fuels including natural gas, electricity and hydrogen, the maximum level is expected to be six to seven times above the current levels depending on the degree of government intervention.” (Ref: CO_0159)
  • “Biofuels will probably be a main option for aviation, long-distance road transport, and rail where it cannot be electrified.” (Ref: CO_0245)
  • “While aviation will continue to rely on liquid kerosene, promising sustainable alternatives to fossil kerosene are synthetic biomass-derived fuels and second generation biofuels. As a result of extensive research, biofuels were approved for use in 2011 and demonstration and commercial flights are now being carried out using add-on biofuels.” (Ref: CO_0234)