McKinsey report looks into energy productivity solutions (page 3 of 3)

China alone represents 34% of the global energy demand growth that MGI projects to 2020. Even with the significant energy efficiency improvements expected under current policies in China, continuing industrialization and quickly expanding demand from the country's growing ranks of middle-class consumers will fuel rapid energy demand growth.

India represents a much smaller share of energy demand growth (8% of the global total) than China. There are three reasons for this. First, India has a lower income level than China and thus a lower penetration of energy-consuming appliances. Second, India is at an earlier stage in its industrialization and has a lower share of heavy manufacturing, and its industry therefore consumes less energy than industry in China. And third, a shift in India's fuel mix from biomass to more efficient electricity will act to mitigate energy demand growth.

On the other hand, the Middle East will account for 11% of energy demand by 2020, making it the second-largest contributor to the overall growth in energy demand of developing countries. These countries' energy-heavy development strategies along with large energy subsidies to consumers will continue to make growth highly energy intensive.

Latin America and Asia (not including China and India) will represent 8% and 5% respectively of overall growth in energy demand, with both industrial and consumer end-use sectors driving expansion. Russia and Eastern Europe is an exception among developing countries in that this region will witness slower energy demand growth of 1.4% per year. This is due to the fact that these economies are shifting away from the extremely energy-intensive and inefficient production of the Soviet era.

(*The Middle East region refers to Bahrain, Iraq, Iran, Kuwait, Kyrgyzstan, Oman, Pakistan, Qatar, Saudi Arabia, Syria, Tajikistan, UAE and Yemen.)