World Energy Model
Scenario analysis of future energy trendsExplore the Sustainable Development Scenario
Since 1993, the IEA has provided medium to long-term energy projections using the World Energy Model (WEM) – a large-scale simulation model designed to replicate how energy markets function. The WEM is the principal tool used to generate detailed sector-by-sector and region-by-region projections for the WEO scenarios. Download the WEM Methodology document for an in depth description of the overall approach and features of the model.
Scenarios in WEO 2017
New Policies Scenario (NPS)
The NPS aims to provide a sense of where today's policy ambitions seem likely to take the energy sector. It incorporates not just the policies and measures that governments around the world have already put in place, but also the likely effects of announced policies, including the Nationally Determined Contributions made for the Paris Agreement.
Sustainable Development Scenario (SDS)
This new scenario was developed for WEO-2017 and outlines an integrated approach to achieving internationally agreed objectives on climate change, air quality and universal access to modern energy. Read more about the SDS.
Current Policies Scenario
This scenario only considers the impact of those policies and measures that are firmly enshrined in legislation as of mid-2017. It provides a cautious assessment of where momentum from existing policies might lead the energy sector in the absense of any other impetus from government.
Other WEO scenarios and cases
Faster Transition Scenario
This scenario, developed in 2017, plots an emissions pathway to "net zero" enery sector CO2 emissions in 2060, resulting in lower emissions than the SDS in 2040.
Low Oil Price Case
This case, considered in Chapter 4 of WEO 2017, looks at the conditions that would allow the oil price to remain "lower for longer". It updates the Low Oil Price Scenario presented in WEO 2015.
Energy for All Case
Developed specifically for 2017, this case examines the achievement of modern energy for all against the backdrop of the NPS. It provdes a point of comparison with the way that a simlar goal is covered in the SDS.
In this scenario, policies are adopted that put the world on a pathway that is consistent with having around a 50% chance of limiting the global increase in average temperature to 2°C in the long term, compared with pre-industrial levels. This document describes the policy framework underlying the scenario.
Clean Air Scenario
Introduced in a WEO special report in 2016, this scenario set out a cost-effective strategy, based on existing technologies and proven policies, to cut 2040 pollutant emissions by more than half compared with the NPS.
Featured in another WEO special report in 2015, this scenario put forward a bridging strategy, based on five specific energy sector measures, to achieve an early peak in energy-related CO2 emissions.
This scenario was developed with a view on short-term climate mitigation options until 2020. The short-term measures considered in this scenario go beyond policies already adopted and entail measures that require either significant further strengthening and wider adoption, or that are currently not high on the policy agenda, even though the measures required to implement the relevant policies are known and their adoption could make a significant additional difference.
This report, prepared by IISA, examines global emissions of major air pollutants (SO2, NOx, PM2.5) resulting from energy scenarios developed for the WEO 2012, which have been estimated using the IIASA GAINS model. The Scenario labelled High Energy Efficiency Scenario corresponds to the Efficient World Scenario in WEO 2012.
This report prepared by IIASA examines emissions of major air pollutants (SO2, NOx, PM2.5) for India resulting from energy scenarios developed for the WEO-2015, which have been estimated using the IIASA GAINS model.
In this scenario, all energy-efficiency investments that are economically viable are made and all necessary policies to eliminate market barriers to energy efficiency are adopted. This document describes the policy framework underlying the scenario.
New features of the WEO 2017
The WEO-2017 uses a scenario approach to examine future energy trends. It presents three scenarios: the New Policies Scenario, the Current Policies Scenario and the Sustainable Development Scenario. The formal base year for this year’s projections is 2015, as this is the last year for which a complete picture of energy demand and supply is in place, but we have used more recent data wherever available, and we include — for the first time — our 2016 estimates for energy production and demand in the annexes of the WEO and tables and discussion in the WEO typically refer to 2016 data. Some of the changes made to the WEM for the purposes of the WEO-2017are highlighted below (more listed in Methodology documentation):
- Overhaul of the industrial heat demand modelling and diffusion of new and renewable heat supply technologies (e.g. solar thermal, geothermal and heat pumps).
- The industry model now allows for the use of bio-based feedstock, though usually in very limited scale, for various raw chemicals (in particular, ethylene, ammonia and methanol). This feature is used in the new Sustainable Development Scenario only.
- Additional analyses had been integrated into the modelling of building electricity demand by end-use for the WEM hourly model. Population weighted average sunrise and sunset times were used to enhance the modelling of lighting electricity demand profiles for the 36 typical days used in the WEM hourly model (12 months, Weekdays, Saturdays and Sundays. In addition, for China and the United States, monthly space heating and cooling profiles have been linked to modelling of weighted average heating and cooling degree days.
- Modelling of services buildings has also been further developed using employment data. For WEO-2017 detailed analysis of the number of employees within services sub-sectors has been used to project the future number of employees and the floor area of services buildings by subsector.
- Addition of alternative powertrains (electric, plug-in hybrid electric gasoline/diesel) for buses and medium- and heavy-duty trucks.
- The cost analysis of electric cars in the passenger car module was updated to reflect recent progress in battery costs, and the analysis of the long-term outlook for EV cost reductions was refined.
- For the WEO-2017 Energy Access Outlook special report a comprehensive update of the IEA electricity access database and clean cooking access database was undertaken, with historical time series of country-level data presented for the first time on www.iea.org/energyaccess/database/.
- These new time series as well as an assessment of country-level investments and policies were used to update projection models for electricity and clean cooking access in the New Policies Scenario.
- With the KTH Royal Institute of Technology, the WEM access module was linked to a geospacial model of electricity demand and resources for sub-Saharan Africa to determine the least-cost evolution of electrification in the New Policies Scenario and to deliver universal electricity access.
- With Politecnico di Milano, a comprehensive assessment of cookstove costs and performance was undertaken, informing the investment and emissions from the cooking access model.
- An improved capacity margin mechanism was included with specific consideration to the role the new additions would play (e.g. baseload, mid-merit or peaking plant).
- A new, more granular model of the power market with hourly resolution was developed for the special focus on renewable energy, to assess the scope for the integration of variable renewables and the related costs. This allows for a more detailed understanding of the implications of seasonal, daily and hourly variations in the output of certain renewable energy technologies, notably wind and solar, in different markets and the flexibility that is required of other power system components.
- More definition on finding and development costs for different types of conventional and unconventional oil and gas, as well as a revised representation of associated gas production.
- A new well-level play-by-play models for tight oil and shale gas in the United States incorporating endogenous technology learning for production from individual plays.
- Modification of the way that trade in natural gas is represented, incorporating the best available information on supply contracts and infrastructure plans, disaggregation by country in North America and more detail on gas imports by the European Union.
- Addition of a new oil and gas methane model to estimate emissions levels and abatement opportunities and costs for methane emissions from oil and gas operations globally.
More information on...
Drivers of change in energy demand and CO2 emissions
Various drivers determine the demand for energy and CO2 emissions, including a change in the demand for energy services, a change in efficiency or a change in the set of technologies satisfying an energy service. This document outlines the decomposition analysis used to quantify the impact of those drivers (PDF)
This model describes how economic activities are linked to each other across sectors, regions and economic agents (i.e. intermediate sectors of production, households, and government). It also links economic activity to environmental pressure, namely to emissions of greenhouse gases. Economic activities and corresponding emissions are projected over several decades (PDF).
Renewable energy projections
The annual updates to WEO projections have reflected the broadening and strengthening of policies over time, including for renewables. The differences that have occurred between actual levels of renewables generation and projected levels for individual technologies in past WEOs (in particular for wind power and solar PV), therefore, are a reflection of the growing policy support for these technologies, and serve to reinforce the point that the IEA has made for a long time: that policies do matter (PDF).
Policy impacts on renewable energy growth
Changes in policy have created boom-and-bust cycles in some markets, as investors respond to incentives when they are available, but then back off when the policies are weakened or withdrawn. As policies change, so the projections change as well. For technologies like solar PV that rely on policy support, shifts in policy matter a great deal (link).
Fossil-fuel subsidies are most often wasteful, inefficient and costly and this document outlines the approach undertaken to calculate these subsidies in WEO-2012 (PDF).
Renewable energy sources are used in several sectors. In many cases they are still not competitive and require subsidies to enhance and accelerate their deployment. Subsidies for renewable-based electricity generation and biofuels for transport have been estimated in WEO-2012 and this document outlines the approach taken (PDF).
Outlines the methodology used for the water-energy analysis in WEO-2016. Includes projections of the water requirements for energy production, expressed as withdrawal and consumption and projections on the energy used for a range of different processes in the water industry, such as wastewater treatment distribution and desalination, by scenario, region and energy source over the period 2014-2040 (PDF).
WEO focuses on two elements of energy access: a household having access to electricity and to a relatively clean, safe means of cooking. These are measured separately. We maintain databases on levels of national, urban and rural electrification rates and on the proportion of the population without clean cooking access. Both databases are regularly updated and form the baseline for WEO energy access scenarios to 2040 (link).
Investment in power generation
Unit investment costs, power plant efficiencies and other operational parameters in the power generation sector are based on a review of the latest country data available. Investment costs represent over-night costs for all technologies. For renewable energy technologies and for power plants fitted with Carbon, Capture and Storage (CCS), the projected investment costs are based on assumed technology learning rates and the level of deployment in each scenario (XLS).
Investment in energy efficiency in end-uses
A comprehensive review of the costs of reducing energy consumption for various technology options in transport, buildings and industry was conducted for the World Energy Investment Outlook 2014. Datasets for the different end-use sectors were peer-reviewed by reviewers from industry and the scientific community. The analysis was updated accordingly in order to reflect the most recent state of research. For the purpose of the World Energy Investment Outlook 2014, energy efficiency investment is defined as the additional expenditure made to improve the performance of the energy-using equipment above the average efficiency level in 2012 (XLS).
In order to underpin scenario analysis of the World Energy Outlook, an extensive effort is made to update and expand the list of energy and climate-related policies and measures that feed into our modelling. Assumptions about government policies are critical to this analysis and over 3 000 policies and measures in OECD and non-OECD countries have been considered during the WEO preparation. A summary of some of the key policy targets and measures for different sectors by selected countries and regions for WEO-2017 can be found in Annex B of the WEO-2017.
The core databases that feed into the WEO analysis are:
- IEA/IRENA Global Renewable Energy Policies and Measures database
- IEA Energy Efficiency database
- IEA Addressing Climate Change database
Although all care has been taken to ensure accuracy, completeness and clarity of content in these databases, they may not be a complete listing of all energy related policies in the region or country covered. For various reasons information can be difficult to find or confirm, and some translated information is subject to the translator's discretion. If you have more up-to-date information, please help us improve the quality of this service by contacting the IEA at email@example.com.