BP’s Valentine Day gift to the energy geek world: the release of BP’s Energy Outlook and Chief Economist Spencer Dale’s discussion of key issues and implications of its work. As previously written,
BP’s chief economist, Spencer Dale, is perhaps one of those for who the old EF Hutton ad applies: when Spencer Dale speaks, people should listen. Thoughtful, substantive, and often incisive about what has happened, is happening, and might/potentially could happen in the energy sector.
As as a sign that opinion is shared by others, in addition to a packed meeting room in London, there were 8,435 people signed in globally to the live webcast.
From the presentation, the key underpinning point about humanity’s requirements is perhaps ‘no surprise’ but succinctly well put. Any reasonable look out into the future, seeking to have improved conditions for humanity is summarized in four words:
More energy, less carbon
Ending energy poverty and increased ‘middle class demands globally drives a massive increase in energy demand and requirements. BP’s CEO, Bob Dudley, gave a window on this based on a recent conversation with Boeing’s CEO:
Eighty two percent of humanity has never been on a plane.
Every year, year-in, year out, Boeing projects 100 million people taking their first flight.
While energy efficiency and other paths towards improved energy productivity can ameliorate the extent of this increased demand, a reasonable look forward ends at roughly 40 percent greater global energy use by 2040. With a reasonable assessment of current trends, this would mean a ten-percent increase in annual global green-house gas (GHG) emissions.
Pretty simple summary: continued growth in annual emissions means cooking humanity’s future.
Thus, if meeting increased services will occur without cooking humanity’s future, there must be far more aggressive energy efficiency globally and far more aggressive introduction of renewable energy than what is currently projected under current policy structures.
Note: I intend to provide additional thoughts on the BP Energy Outlook after having a chance to read through it rather than an immediate response to/during its initial presentation. In the interim, I recommend taking a look of Gregg Muttitt’s 2017 BP’s Energy Outlook: between forecasting and advocacy.