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Buildings

Buildings?account for over a third of global energy growth, driven by increased power?demand in the developing world

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The increase in prosperity and expanding middle class in the developing world drives growing use of energy within buildings.

Growth of?prosperity and energy use in buildings
Growth of prosperity and energy use in buildings
Final?energy consumption in buildings by fuel
Final energy consumption in buildings by fuel

In the ET scenario, energy used in buildings grows (1.5% p.a.) more strongly than in industry or transport, with its share of overall energy consumption edging up to around a third by 2040.

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This growth is driven entirely by developing economies, where improving wealth and living standards allows people to live and work in greater comfort.


Electricity provides most of the increasing energy used in buildings

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Energy growth in much of the developed world and CIS essentially flat-lines as increasing activity is offset by efficiency gains.

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The vast majority of the growth in energy used in buildings over the Outlook is provided by electricity, reflecting greater use of lighting and electrical appliances and the increasing demand for space cooling in much of the developing world (Asia, Africa and the Middle East) as living standards increase.

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There is also small increase in gas consumption, which gains share from both coal and oil in space heating and cooking.

Alternative scenario?– lower carbon industry and buildings

Lower carbon industry and buildings, driven by?efficiency gains, CCUS and circular economy

Energy?demand growth in ET and LCIB scenarios
Energy demand growth in ET and LCIB scenarios
Note: Industry does not include non-combusted sector
Buildings?and industry fuel mix (2040)
Buildings and industry fuel mix (2040)

?In the ET scenario, the growth of energy used in both industry and buildings slows relative to the past, as gains in energy efficiency accelerate. The ‘Lower-carbon industry and buildings’ (LCIB) scenario considers an even more marked slowing in energy:

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  • for industry, this reflects greater gains in energy efficiency as recent trends in efficiency are accelerated, supported by an expansion of circular economy activities (re-use and recycling) reducing demand for new materials and products;
  • for buildings, these gains are achieved via a combination of retrofitting existing buildings and stricter regulation of new buildings and electric appliances.

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Energy use in industry and buildings increases by only 0.3% p.a. in the LCIB scenario, compared with 1.0% p.a. in the ET scenario and 1.8% p.a. over the past 20 years.


Industry and buildings are the dominant end-users of global energy and so have an important bearing on the energy transition

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In addition, a rise in carbon prices in line with that assumed in the Lower-carbon power scenario (pp 58-61) prompts a shift in the fuel mix, particularly in industry, away from coal towards gas and power and increases the use of carbon capture use and storage (CCUS) in the industrial sector.

Alternative scenario?– lower carbon industry and buildings

Carbon?emissions fall in the LCIB scenario, largely in industry, driven by efficiency?and CCUS

Carbon?emissions in industry and buildings
Carbon emissions in industry and buildings
Carbon?emissions by sector
Carbon emissions by sector

In the LCIB scenario, CO2 emissions from industry and buildings scenario fall by 15% (3.9 Gt by 2040), compared with an increase of 6% (1.7 Gt) in the ET scenario.

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The majority of these reductions relative to the ET scenario are concentrated in the industrial sector. These gains are driven by the accelerated efficiency gains and the increase use of CCUS which, in the industrial sector, reaches around 2 Gt by 2040. The reduced demand for new materials and products associated with the increased adoption of circular economy activities also adds to carbon savings in industry.

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The reduction in carbon emissions from buildings are more limited, and all stem from the efficiency measures applied to retrofitting existing buildings and tighter efficiency regulations for new buildings and appliances.

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The contribution of fuel switching to the fall in carbon emissions is relatively small in both sectors. This partly stems from the difficulty of switching fuels for some activities, especially high-temperature processes in industry. It also reflects that the benefits of switching from existing fuels into electricity are mitigated without a significant decarbonization of the power sector.

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