

World Energy Outlook (WEO) is an annual publication from the International Energy Agency (IEA) that provides "energy market analysis and projections, providing critical analytical insights into trends in energy demand and supply and what they mean for energy security, environmental protection and economic development." (World Energy Outlook: About)
WEO 2016 provides analysis and projections through the year 2040. How does the IEA do this?
Since 1993, the IEA has used a simulation model called the World Energy Model (WEM) to generate the projections that are used in the annual WEO. The model replicates worldwide energy markets and has three main sections: final energy consumption (including residential, services, agriculture, industry, transport and non-energy use), energy transformation (including power generation and heat, refinery and other transformation), and fossil-fuel and bioenergy supply.
The primary outputs of the model are energy flows by fuel, investment needs and costs, CO2 emissions and end-user pricing--all, by region. (For more detail see the section Methodological approach, in the assigned reading.)
Of course, even the IEA with its huge models doesn't know exactly what the future holds. The future? We all know, well...it depends! To address "it depends" the IEA establishes sets of assumptions called scenarios. (This is standard practice in all future-based modeling.) In WEO16, the IEA has established three scenarios, differentiated primarily by their underlying assumptions about government policies:
- Current Policies Scenario (CPS) based on government policies that were formally adopted by mid-2016, together with relevant policy proposals.
- New Policies Scenario (NPS) takes into account the policies affecting energy markets that had been adopted as of mid-2016, together with relevant policy proposals. This is the WEO's "central" scenario.
- 450 Scenario (450S) assumes a set of policies that will have a 50% chance of limiting the global increase in average temperature in 2100 to 2°C above pre-industrial levels. This would require limiting the concentration of greenhouse gasses in the atmosphere to around 450 parts per million of CO2 equivalent (ppm CO2-eq)
Section 1.1 of WEO16 describes the scenarios in greater detail.
Reading Assignment
The full WEO16 is available to you through Penn State Libraries (woo hoo!)
- Go to PSU Library and under Research, select Databases by Title (A-Z).
- Search for OECD iLibrary and open it.
- Enter the search terms energy outlook. Select and download World Energy Outlook 2016.
- In Executive Summary
- Read intro and The world’s energy needs continue to grow, but many millions are left behind, pages 21-22
- Read The policy focus shifts to integration, pages 24-25
- Read Energy and water: one doesn’t flow without the other, page 28
- In Power sector outlook
- Read Highlights, page 241
- Read section 6.1 Recent policy and market developments, pages 242-244
Note:
OECD stands for Organisation of Economic Co-Operation and Development. For a current list of member countries, and more interesting info, please see OECD Members and Partners.