Uncertainty reigns as energy leaders address sector challenges – study

A survey conducted by the World Energy Council to assess what is on the minds of nearly 2,200 energy leaders from 91 countries has revealed uncertainty across almost all issues trending within the energy market.

The study states that factors including the volatility of commodity prices, fragmented economic growth and increased energy interdependence and concerns around security of supply are resulting in an unclear picture of how energy leaders should drive the global energy agenda.

The study has been released at a time when there are disparities amongst global leaders on issues such as the use of nuclear as a low-carbon resource, the labeling of gas as a sustainable energy resource and the continued use of coal to meet energy demand in China and developing economies.

The situation is further complicated by the geopolitical tensions with Russia, which have impacted gas prices and security of supply and prevented EU countries from filling their gas storage capacity in 2021.

The study by the World Energy Council revealed that commodity price volatility is the top concern amongst energy leaders across the globe, with uncertainty 12x greater than in 2021.

Global leaders have also highlighted that their top priority moving forward is improving access to quality, clean, reliable, and affordable energy.

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In North America, energy leaders are mainly uncertain about how they will manage climate change. However, on a global scale, climate change management does not rank high amongst all the other uncertainties, according to the study.

In Europe, geopolitical uncertainty ranks high due to escalating trade tensions and continued pressure on leaders in the region to cope with pandemic shocks.

Leaders from the Middle East and the Gulf States say renewable energy deployment will be their main focus as governments seek to speed up the energy transition.

Hydrogen continues to be viewed with a high degree of uncertainty across most regions as leaders explore how to build a functioning hydrogen economy. 

Other factors raised include equity and equality in delivering the energy transition and increased focus on reducing energy prices.

Dr Angela Wilkinson, Secretary-General of the World Energy Council, said: “Energy matters are now center stage in a world of more digitally connected, politically contested, interdependent and diverse societies. This year’s edition of our World Energy Issues Monitor reflects increasing global uncertainty about the collective ability to manage a steady global energy transition, as rising energy costs and shifting geopolitics hinder leaders’ ability to find and scale solutions that meet demand for more sustainable energy and address climate change. Leadership uncertainty reflects the complex challenges of coordinating actions on net-zero energy uses, without triggering new threats to regional and global stability.

“Commodity prices are inherently linked to system costs, affordability, taxation and, crucially, equity. Humanising energy is imperative – we must involve more people and voices, community solutions and ways of holding leaders to account.  Better solutions for people and planet will require new models of human and economic development and a shift from incremental improvements to transformational strategies that work across borders, across sectors, involve all levels of society, and deal with more than one issue at a time.”

Find out more about the study.