“If we don’t change directions soon, we’ll end up where we’re heading.” — Fatih Birol, Chief Economist, International Energy Agency
This is the conclusion of the International Energy Agency's (IEA) World Energy Outlook 2011, presented at SIPA on November 29, by the IEA’s Chief Economist Dr. Fatih Birol. It was the final lecture of the 2011 Leaders in Global Energy series.
Dr. Birol began with a general overview of the report, saying:
"The overall tone about the energy picture and climate change is much more pessimistic than in previous years."
He attributed the pessimism to several reasons. First, according to Dr. Birol, energy is sliding as a priority for most governments. It used to be near the top of the agenda. However, due to the financial crisis, the most important issue in many countries is now the economy. In addition, most of the solutions needed in the energy field require additional funding, and governments do not have extra funds as they attempt to address their budget deficits.
Secondly, Dr. Birol said that the accident in Fukushima will have major implications on the future of energy in the world, as countries, including France and Japan, debate their nuclear futures. Thirdly, he discussed the impact of the Arab Spring:
"The bulk of the energy production growth, oil, needs to come from the Middle East and North Africa. But the changes now make us doubt if this will happen.”
Dr. Birol then discussed discouraging figures and changes:
“In 2010, we have the highest level of CO2 emissions ever,” he said. “It reached a historical high, which is a contradiction with increasing government interest and public awareness.
I don’t know a government in the world which hasn’t made energy efficiency its priority,” he added. “However, for the first time in many years, in 2009 and 2010 global energy efficiency has worsened, which is very bad news.”
Dr. Birol then discussed the energy scene in various countries, emphasizing:
- the importance of Russia for global supply
- the prominent rise of China and the implications on global demand
- the decrease in the United States’ oil imports (and therefore the decrease in their involvement in energy security and price monitoring)
- the future of Australia in leading in the production of natural gas.
He discussed other global challenges, primarily energy poverty and the increase of demand from developing countries.
"There will be demand growth, but with which technologies and energy supply will we meet it?" asked Birol.
Photo: Fatih Birol takes students’ questions.
World Energy Outlook 2011: Summary and key points
This event was live-tweeted at #SIPAEnergy.