Future energy challenges and future scenarios

In 2007, our CEO Jeroen van der Veer, said there are three hard truths of global energy challenges.

1. The global demand for energy is growing, both in the developed and developing world. This will mean greater demand for oil and gas.
   
2. Supply will struggle to keep pace. Easy oil (accessible, conventional oil and gas) cannot keep up with the unconstrained growth in energy demand. Society has no choice but to add other sources of energy including alternatives like solar, wind and biofuels and 'unconventional' fossil fuels like oil/tar sands, oil shale and contaminated gas. Even with huge improvements in energy efficiency and substantial growth in renewables, fossil fuels will still be the major part of the energy mix by mid century.
   
3. Environmental stresses are increasing. More energy means more CO2 emitted at a time when climate change looms as a critical global issue. The societal imperative to limit greenhouse gases in the atmosphere at a level less than 550 ppm will require the strict management of CO2 emissions from both the production of energy and its use by consumers.
   

These three hard truths pose obvious dilemmas that can only be reconciled through joint, concerted efforts by governments, industry and consumers. The task of balancing the accessibility, affordability and acceptability of energy will not be an easy one. Humanity faces a challenging outlook for energy. This can be summed up in five words: "more energy, less carbon dioxide".

To help think about the future of energy, long term planners developed two scenarios that describe alternative ways it may develop. In the Scramble scenario policymakers pay little attention to more efficient energy use until supplies are tight. Likewise, greenhouse gas emissions are not seriously addressed until there are major climate shocks. In the Blueprints scenario, growing local actions begin to address the challenges of economic development, energy security and environmental pollution. A price is applied to a critical mass of emissions stimulating the development of clean energy technologies, such as CO2 capture and storage, and energy efficiency measures. The result is far lower CO2 emissions.

Mr van der Veer said he was determined to provide energy in responsible ways and serve customers and investors as effectively as it can. Both these scenarios help the company do that by testing their strategy against a range of possible developments over the long-term. It is in his view, the Blueprints' approach offers the best hope for a sustainable future, whether or not the scenario arises exactly in the way it is described.