Continued uncertainty in the future direction of climate frameworks, political instability in the Middle East and North Africa (Mena) region, energy price volatility, and the global economic recession were the fundamental energy issues for this year.
This was according to the 2013 World Energy Issues Monitor, published on Thursday by the World Energy Council (WEC).
Speaking at the launch of the report at the World Energy Leaders Summit, in New Delhi, WEC chairperson Pierre Gadonneix said the report revealed that the critical issues identified by energy leaders were chiefly macroeconomic and geopolitical.
“In particular, uncertainties surrounding climate framework reveal the strong desire by the energy sector to have clearer and more balanced governance. The survey also reveals the need to identify pragmatic, cost-effective, and technology-neutral policies,” he said.
The study also revealed that carbon capture, utilisation and storage (CCUS) issues had moved down the energy sector’s priority list.
“Energy leaders believe that, until there is clarity on the price of carbon, CCUS will continue to be seen as an additional cost on energy given the current recessionary context. This is in marked contrast with previous surveys which identified CCUS as a potential panacea,” Gadonneix noted.
Report author and WEC secretary-general Dr Christoph Frei added that the most significant change in the perspective of energy leaders was the developing tension between their desire for a climate framework and their lack of confidence in certain mitigating technologies.
This change in perception was of considerable concern, as the success of new technologies, such as CCUS, would be critical for the “massive transition” required in the energy sector to be realised, he said.
While unconventional fossil fuels, including shale gas and unconventional oil, were firmly considered to make impact on the sector for some time, the WEC study found that further action was required to realise their potential.
“Renewable energy and energy efficiency are also areas needing further action, as they can contribute to diversity and security of supply, as well as enabling energy access to the 1.3-billion people without it,” the report said.
Frei added that renewables and energy storage had the potential to significantly increase energy access and enhance security of supply; however, the appropriate innovations and investments to integrate these technologies were required.
“While the opportunities here are huge, having the correct enabling policies are crucial to their delivery,” he said.