Thursday, November 02, 2006

Fossil Fuel Consumption and its Implications

EarthTrends Update October 2006:

Fossil Fuel Consumption and its Implications

By Amy Cassara and Thomas Damassa

From small businesses to large economies, the long-term availability of energy worldwide is paramount to growth and development. Energy provides industry with a means to manufacture goods, generates the electricity and heat that we require on a daily basis, allows for the rapid transport of people and products, and enables food production and access to potable water.

The availability of energy in our current global framework relies extensively on the availability of fossil fuels: the oil, natural gas, and coal that together constitute 80 percent of global energy consumption.

Fossil Fuels in 2004

Consumption of fossil fuels varies by region and by country. The biggest consumers are the United States, China, and the European Union, accounting for more than half of all fossil fuel consumption (see above). Coal, which is not easily transported long distances, accounts for a large percentage of consumption where it is locally available, while oil and natural gas can be consumed far from their source of extraction--in 2004, trade in fuels totaled US$715 billion worldwide (World Bank, World Development Indicators 2006).

A Resource With Limits

Fossil fuels are an unsustainable resource; formed from the decay of plants and animals over millions of years, our planet has a finite number of deposits. Fuel reserves are also disproportionately distributed throughout the globe: the United States contains one-quarter of the world's coal reserves, while five countries in the Middle East contain approximately 60 percent of the world's oil. Global markets direct the buying and selling of fossil fuels between countries with ample resources (see below) and those with limited reserves, insufficient technology, or high energy demand. Trade in energy adds a socio-economic dimension to fossil fuels, with implications for energy security and the geopolitical landscape.

Largest Fossil Fuel Reserves

Although estimates of available reserves vary, at current annual rates of production about 155 years of coal, 40 years of oil, and 65 years of natural gas are left, worldwide (BP plc, Statistical Review of World Energy 2006).

The ability for each country to sustain its own energy demands without importing fuel can be measured by a nation's reserves-to-production ratio, which measures the number of years that proved reserves would last at current production rates. The map below shows reserves-to-production ratios for proved reserves of oil.

Global Oil Reserves-to-Production Ratios, 2004

Global Reserves-to-Production Ratio 2004

Global Reserves-to-Production Ratio 2004 Key

Beyond issues of availability, our pervasive use of fossil fuels is having significant environmental effects. The emission of carbon dioxide and other "greenhouse" gases from the combustion of these fuels is rapidly warming the planet, altering our climate system, and jeopardizing the well-being of both people and ecosystems. Fossil fuel combustion currently accounts for 61 percent of greenhouse gas emissions (WRI, Navigating the Numbers, 2005).

Changing Course

With a rapidly growing world population and burgeoning economic development across much of the world, issues of energy security and environmental degradation will likely grow increasingly prominent in national agendas. Achieving solutions will not be easy, but enhancing energy security and averting future harms to the environment is possible, and can also be profitable.

To reduce dependence and demand on fossil fuels, governments, businesses, and individuals can:

- Develop fossil fuel energy alternatives,
- Increase energy efficiency, and
- Reduce energy consumption.

Many countries, either by choice or necessity, have already utilized alternative forms of energy as their principal energy source. Fossil fuel alternatives, including hydropower, solar power, and biofuels, each have their own set of social and environmental consequences, both positive and negative (discussions of which are beyond the scope of this summary), but unlike fossil fuels, do provide opportunities for sustainable energy. Increases in energy efficiency can be achieved through both market mechanisms and technological innovations.

Individual actions can make a substantial difference in reducing global energy consumption. For example:

* Replacing incandescent light bulbs with compact fluorescent lamps (CFL's)--a little more expensive upfront, but CFL's last longer and use much less energy
* Walking, biking, using public transportation, or car pooling whenever possible
* Moderating heating and cooling--a couple of degrees can make a significant impact on energy consumption
* Turning off lights and electronic equipment when not in use--even in "standby" mode, electronics still consume energy
* Buying high efficiency cars and appliances
* Investing in renewable technologies
* "Greening" your office or company (please see highlighted publications)

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