It pays to consider every option where energy is involved. In fact, it’s vital that all possible paths are explored. Which is exactly what is happening, says Andrew Cave.
Nobody has a crystal ball to predict developments in energy sources, consumption patterns and policy by 2050.
Yet it is possible to develop credible potential scenarios highlighting choices that need to be made about our future in a carbon-constrained world.
Shell has done exactly that, producing two potential scenarios that may develop from mushrooming energy demand from globalisation and rapid population growth, diminishing conventional oil and gas resources and environmental stresses from climate change.
The first, called Scramble, reflects a focus on national energy security, with immediate pressures driving country decision makers to focus on securing near-future energy supply for themselves and their allies.
Policymakers therefore pay little attention to more efficient energy use until supplies are tight, while greenhouse gas emissions go effectively unaddressed unless major climate shocks occur.
National government attention falls on supply levers that can easily be pulled, including the negotiation of bilateral government deals between energy producers and energy consumers and incentives for local resource development. Coal, biofuels and renewable energy become much more significant, with the global coal industry doubling in size between 2000 and 2025 and biomass representing 15 per cent of primary energy by 2050.
However, energy efficiency and other policies to do with energy demand are not addressed meaningfully until the supply stresses become too serious for the market to cope with.
Then an overall energy supply crisis results and governments react with draconian domestic price rises or personal mobility restrictions, resulting in a global economic slowdown by 2020.
The turnaround to healthy economic growth takes a decade, with locally developed biofuels, wind and thermal solar energy eventually stimulating innovation. However, by then it is clear that a new international approach to energy security and climate change mitigation is needed.
The world is 20 years behind where it would have been had it set up such a system by 2015. In addition, nations are likely to face expensive consequences beyond 2050.
Blueprints, Shell’s other scenario, paints a more collaborative picture in which local actions begin to address the challenges of economic development, energy security and environmental pollution.
Alliances in developed and emerging nations lead to parallel responses to supply, demand and climate change stresses, starting with a replacement for the Kyoto Protocol, which expires in 2012.
CO2 prices strengthen – helped by a new pricing mechanism and trading scheme – energy efficiency improves, the emergence of mass-market electric vehicles is accelerated and the rate of growth of atmospheric CO2 is constrained.
The US responds to pressure by promising to reach European minimum fuel economy standards for cars by 2020, while China and India secure agreements to facilitate technology transfer and investment in energy-efficient plants in exchange for taking part in international frameworks.
Increasingly aligned approaches to CO2 management in the US, China, India, Japan and Europe pave the way for carbon capture and storage to become a reality after 2020.
By 2050, economic growth no longer relies on an increase in the use of fossil fuels. The world is increasingly one of electrons, rather than molecules, with electric vehicles becoming the norm and power generation from renewable energy sources growing rapidly.
Almost 90 per cent of coal and gas-fired power stations in OECD counties and 50 per cent elsewhere are equipped with carbon capture and storage technologies, reducing overall CO2 emissions by 15 to 20 per cent, compared to what would otherwise have happened.
By 2055, the US and the EU are using an average of 33 per cent less energy per capita than today while Chinese energy has peaked.
Neither scenario is ideal or comfortable.
However, acknowledging their potential can be the first stage of developing a road map to answer the problems that the Age of Energy poses over the next 40 years.
Source: Telegraph
www.telegraph.co.uk
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