If the energy industry does not act now to develop sustainable energy sources, the world will face an energy crisis in the middle of the next century.
The enemy of progress is complacency, and London-based World Energy Council (WEC) fears the energy business is smug right now.
John Baker, WEC chairman and chairman of U.K. electricity generator National Power plc, London, said energy concerns are low on the agendas of developed nations.
"This is because there are no structural supply shortages in prospect," said Baker. "Although oil prices have drifted up recently, fossil fuel prices are expected to remain low into the foreseeable future."
Baker said this has encouraged complacency-compared with 10 years ago-that is hampering the drive toward energy efficiency, environmental issues, and fiscal promotion of energy conservation.
Although there are plentiful supplies of fossil fuels now, said Baker, global energy demand is expected to double in the next 50 years.
By 2050, developing countries are expected to use 60% of the world's energy, compared with 35% today.
First step
"It would be a mistake to soft-pedal on a number of issues that would lead to more sustainable energy supplies," said Baker. "Improved energy efficiency is seen as the first step."
A big barrier to energy efficiency is subsidized energy prices in developing countries. WEC believes these countries will not get efficient energy usage and investment in infrastructure until subsidies are removed.
"Indian rice farmers, for example, pay trivial amounts for electricity compared with the cost of producing it," said Baker, "yet in such economies, there could not be price convergence in a hurry."
WEC sees introduction of market forces to all countries as a key, first to encouraging efficient use of energy and, in the longer term, to encouraging development of sustainable resources.
Prospects
Ian Lindsay, WEC secretary general, explained that 18% of the world's energy comes from renewable resources, including hydroelectricity, wood burning, and "new" renewables.
New renewables, including solar, wind, thermal, wave, and biomass account for only 2% of worldwide energy consumption, said Lindsay. It is this sector WEC seeks to boost.
"New renewables," said Lindsay, "could equate to 5-6% of a greater global energy demand by 2020, if people take them seriously. Many new renewables are developed but not quite economic currently.
"New renewables could be viable in the future in certain parts of the world. And by 2020-30, the world will have to use all forms of energy to meet demand."
One problem for WEC is arriving at a consensus among more than 100 member countries. The U.S., for example, would rather rely on energy market liberalization and market forces to spur progress in renewables.
"U.S. government says that when the time is right, markets will show pain," said Baker, "but WEC says that by then it may be too late to act and the damage too deep."
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