Realising the possibilities presented by new energy realities

By Eng Zi Guang

“Things that seemed like an interesting, distant possibility a few years ago, are quickly becoming the new reality of today,” said Mr David Gray, Chairman of the UK Gas & Electricity Markets Authority (GEMA), a Keynote Speaker at this year’s Singapore Energy International Energy Week.

The rapid advancement of the energy sector makes long-term policy-making more difficult. At the same time, the increasing importance of innovation and new technology presents society with exciting opportunities to achieve strategic goals.

One such goal is the UN Sustainable Development Goal 7 – to secure affordable, reliable and sustainable energy for all, including the 1.1 billion people worldwide who have little or no access to electricity.

To achieve this, Ms Rachel Kyte, CEO and UN Secretary-General Special Representative for Sustainable Energy for All (SEforALL), urged policymakers to prioritise closing the energy access gap when developing the vision for future energy systems. She added that the Paris Agreement on climate change, which goes into force on November 4, 2016, reiterates a key transition into a new energy future.

Pursuing energy efficiency initiatives would be central in accomplishing these goals, said Ms Kyte during her keynote speech at SIEW.

“It would seem especially short-sighted, if not foolish, to not act with determination to drive forward the cheapest, easiest and fastest way to achieve development goals and the Paris Agreement,” she said.

Ms Kyte added the improvements in energy intensity of 44% and 74% achieved respectively by India and China between 1980 to 2011, demonstrate the potential of what can be achieved.

Both speakers agreed on the importance of developing the right policy and financing frameworks to allow renewable energy to achieve its full potential to support global goals. “Technological development has substantially reduced production prices and accelerated the deployment of renewable generation in the UK and elsewhere, with storage technologies likely to follow – having seen costs fall by about 15% per annum,” explained Mr Gray.

These smarter long-term investments must continue to be supported with a level playing field and also be matched by more dynamic planning and operation of the energy system, he added.

To make the most of the rapid changes in the new energy realities, Ms Kyte said that policymakers would have to work towards their long term vision in an iterative manner. Agreeing, Mr Gray said that the scenario-planning approach of the past few decades may no longer be sufficient. “Policies need to have clear objectives. Regulations need to set out clear principles and provide predictability to encourage investment but they also need to be flexible and vigilant to ensure that they do not close off new ideas or block off new approaches from the market.”