Statoil Calls for Immediate Action on Energy

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By MarEx 2017-06-08 20:01:39

Statoil has published the 7th edition of its Energy Perspectives report calling for immediate and coordinated global action.

Statoil says that it expects substantial changes in the global energy mix. In moving towards a low-carbon energy system, new renewables may increase from just over one percent of total primary energy demand in 2014 to almost 20 percent in 2050. 

“We believe it is possible to realize energy emission reductions consistent with the 2-degree target, but it will require immediate and coordinated global action. We should not underestimate the needed transformation, both in terms of energy efficiency improvements, fuel mix changes and modified consumer behavior. Unfortunately, many factors today work against such a transformation,” says Chief economist in Statoil, Eirik Wærness.

“Failing to transform the world’s energy systems will have negative effects across the globe and for all parts of society. We support a development where the world moves in a sustainable direction where climate change targets are met along with other important sustainable development goals as set out by the U.N.,” says Statoil’s CEO Eldar Sætre.

Statoil's report describes three different scenarios for global macroeconomic development, energy demand, energy mix and energy-related greenhouse gas emissions. For the first time the forecast period is extended to 2050. 

The main development trends in all scenarios are that the global population is growing, more people are becoming part of the global middle class, economic growth is continuing and hence the underlying global demand for products, services and activities that require energy is increasing.

In a scenario that is consistent with the 2-degree target, oil reduces its share from 31 to 23 percent, while gas remains at around 20 percent. In order to meet the 2-degree target, the report states that average annual improvement in energy efficiency must be three times higher than what has been the case over the last 25 years.

Regardless of scenario, and in addition to massive investments in renewable energy, the world will continue to need large investments in oil and gas due to natural decline in supply from existing fields. Oil demand is expected to increase into the 2020s. Dependent on scenario, oil demand in 2050 ranges from below 65 to above 120 million barrels per day, compared to around 97 today.

“Electric cars and plug-in-hybrids could account for around 90 percent of private cars in 2050, and efficiency will be much higher than today. Still, with heavy duty and maritime transport, aviation and petrochemical industry growth, oil demand will be above 60 million barrels per day,” says Wærness.

Statoil’s strategy

Statoil will gradually build a material position in profitable renewable energy projects and low-carbon solutions. The company has a strategic ambition to allocate 15-20 percent of its annual investments towards these new energy solutions in 2030. 

“Statoil supports the Paris agreement. We believe that being able to produce oil and gas with lower emissions, while also growing in profitable renewables, will give competitive advantages and provide attractive business opportunities in the transition to a low carbon economy,” says Sætre.

Energy Perspectives is published each year by Statoil. The 2017 report is the 7th edition. The report is available here.