The apparent speed of transformation in the world of energy is increasing. Declining solar costs, new alliances, energy security concerns, volatile markets and breakthroughs in storage, to name just a few, are accelerating the pace of change.
Ahead of a workshop in Bangkok next month, we are sharing an updated view on some of the potential shifts taking place. We have been exploring how changes from within and outside the energy sector could play out for some time. The Shell Technology Futures programmes in 2004 and 2007 brought together leading expertise to debate how, why and where the most significant shifts would occur over the next 20 years. As shared previously, many of the views from these discussions have been highly accurate. More recently, both as part of the global major Future Agenda programmes in 2010 and 2015 and bespoke projects with leading organisations in the sector, we have been adding and updating views on how the future of energy will develop. This new slideshare presentation collates many of these perspectives and will be used next month as the basis of a strategic foresight workshop in Bangkok.
While some of the views are clearly add odds with each other, there is growing consensus on some of the key shifts taking place. The perspectives we have curated have come from discussions with around 250 informed people around the world – in Europe, the US, Asia, Africa and the Middle East – and so there is clealy some variance in views on technologies, transition times and who will be the catalysts of change. However, grouped into four main themes there are several apparent moves afoot:
Macro Shifts: With a growing and increasingly urbanized global population with increasing energy demands, it is clear that resource constraints are a concern. As China becomes more influential, energy security becomes a common issue and most of the world responds to the climate change challenge, who gets access to what type of energy is evidently in flux.
Technology Changes: In an increasingly connected and digital world, many are seeing the increasing automation and machine learning will have a significant impact on energy use. At the same time, the falling cost of solar, hope for fusion success, rapid improvements in energy storage plus advances in carbon capture and HVDC transmission are all coming to the fore.
Potential Disruptions: In an increasingly uncertain world, there is a growing list of potential disruptions. From more flooding and self-insurance to the rising influence of cities to drive change, especially around air quality, many seem probable. Others such as changes in G20 subsidies, the end of IP and greater female influence in the sector could deliver equally significant transformation.
Changes in Business: With a shift in investment to renewables evident, other moves within the energy sector include potential growth in both hydro and nuclear, the support of a more distributed, smart supply and an increasingly transparent cost of supply in a progressively circular economy. Coupled with deeper collaboration and more purpose driven companies, other moves having impact include the speed of EV adoption, new business models, the influence of standards and new forms of organization.
Together these and other changes are seen to be driving a potential transformation of this critical part of the global economy. Although others often look upon energy with disdain, without it we would have no electricity and so no healthcare, food or education. The Future of Energy is vital for all of us and, in an increasingly populated and constrained world, how we mange the next 50 years is going to be pivotal.
We look forward to sharing and using these materials in a number of upcoming Future Agenda and Growth Agenda workshops starting in Thailand and welcome any views, comments and critiques that you may have. We will continue to update this view as new developments emerge and the landscape continues to evolve.