Governments around the world must forge climate change policies that are stable, long-term and informed by specialist expertise to ensure an orderly energy transition in the future, industry experts said.
“Energy should be as long-term and expert-informed as something like defence policy,” Majid Jafar, chief executive of Crescent Petroleum, said during an Atlantic Council session on Wednesday titled The 2022 Global Energy Agenda.
“What you see is flavour of the month, ‘Oh let's all run in this direction’ ... Energy investments are long term and very capital-intensive, and this is why you need stability of policymaking and long-term planning.”
Renewable energy – complemented by green hydrogen and sustainable biomass – is the most competitive and cost-efficient path towards carbon reduction, Francesco La Camera, director general of the International Renewable Energy Agency, said.
In its Global Energy Agenda report released on Wednesday, the Atlantic Council said the Covid-19 pandemic has accelerated the energy transition, and peak oil demand is coming soon. Sixty-one per cent of those it surveyed said the pandemic will accelerate the energy transition, while only 20 per cent believe it will impede it. Similarly, nearly nine in 10 survey respondents believe that oil demand has already peaked or will do so within 20 years.
But political will is the biggest impediment to climate action, the survey showed.
“Emissions reduction is both feasible and worthwhile, but many in the industry are unsure that political leaders can deliver,” the report said.
About three-quarters of those surveyed believe that the goal of net-zero emissions by 2050 is possible to achieve without damage to the economy, but only 36 per cent are very or somewhat certain that it will take place. The main reason they cite for this disconnect is policy and political will.
The Atlantic Council surveyed a global group of energy leaders, asking them a dozen questions in five issue areas: oil and gas; energy geopolitics and energy security; the energy transition, decarbonisation and climate change; new energy technology and innovation; and energy and environmental justice. It conducted the survey between October 28 and November 23, 2020, a period that both spanned the US presidential election and the announcement of hopeful results from several major Phase-3 trials of vaccines against Covid-19.
The report found that energy and environmental justice is regarded as crucial and survey respondents were adamant that the energy transition must bring benefits globally, to all countries and at all socioeconomic levels.
“Far too often, when we talk about the energy transition, we talk about megawatts, storage and fuels only through a climate lens. While all critical elements, we often forget that this energy transition for billions of people and communities around the world is much simpler: being able to access energy at all,” Damilola Ogunbiyi, chief executive and special representative of the UN Secretary General of Sustainable Energy for All (SEforALL) and co-chairwoman of UN-Energy, said in an essay within the report.
