As diplomats are holding their breath ahead of the Conference for the Framework Convention on Climate Change in Paris
this December, the energy sector’s lobbyists, firms, movers and
shakers, are also preparing in London. The objective of the Paris
Conference is an agreement that will keep a ceiling on CO2 emissions
and, therefore, the rise of climate within levels that can be dealt with
from the international community. The objective of the industry, as
always, is to adjust but also lobby for the terms of that adjustment.
Organized by the Economist,
a very important event starts on Wednesday in London for the world of
energy producers, as well as policy makers and other market players.
The 2015 Energy Summit brings
together major fossil fuel producers (BP, Statoil, Total), as well as
academics and consultants, at a defining point for the industry. On the
one hand, oil prices are tumbling and are remaining at prices below $50 a
barrel. On the other hand the world – and the industry – is preparing
for the Paris Climate Summit (COP 21) on the energy field. In essence,
that is a foresight exercise.
Ahead of the Paris Climate Conference, renewables are on the agenda,
as the price of the oil and gas sector greatly determines the pace of
research and development in the field. Keynote speakers to the event,
such as Nick Butler of King’s College and former advisor to Gordon
Brown, suggests that some technologies have achieved a level of maturity
(grid parity) and are no longer in need of subsidies, specifically
solar energy. Wind and nuclear energy production will clearly be in
trouble, and that is an issue given that only days ago China committed
to a £ 40 bn investment in Britain, which comes with guaranteed price
levels for years to come.
Perhaps, it is no accident that BP – a sponsor to the event – came out on Tuesday with its own outlook for energy technology,
looking precisely for key technology drivers for the future. The
report, for example, sees as an industry driver storage (batteries)
rather than merely innovation in production as being the market driver
in the immediate future. One of the key findings ahead of Paris talks,
is that fuel efficient vehicles and technologies will ensure that the
expansion of demand for oil and gas will not lead as great an expansion
in CO2 emissions as one would expect.
Inevitably, Oil and gas will be the focus, because it remains the
market maker. It is clear that OPEC will continue to be dominated by
Saudi Arabia, while other members are “market takers.” For the whole
industry, is how to respond to declining demand, which in combination
with advancing extracting technologies, is leading to tumbling oil
prices. That is a key both for the advancement of low emission energy,
climate change, and the fossil fuels sectors.
http://neurope.eu/article/the-energy-summit-in-london-ahead-of-climate-talks-in-paris/