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/
