World Energy Trilemma 2012: Time to Get Real - the Case for Sustainable Energy Policy

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May 2012
Authors: 
Oliver Wyman
Source: 
World Energy Council (WEC)

Based on more than 40 interviews with energy sector CEOs and senior executives, as well as the 2012 Energy Sustainability Index, this 4th edition of the World Energy Trilemma report attempts to identify and describe what industry executives believe they need from policymakers. The report acknowledges that executives and policymakers urgently need to work together in order to achieve a transition to a sustainable energy system. Key to this report are the three dimensions of energy sustainability: energy security, social equity and environmental impact mitigation. These three core dimensions form a complex web of links between private and public actors, regulators, resources, economic and social forces, and environmental concerns that must be fully understood by all.

The paper begins by presenting the 2012 Energy Sustainability Index. The index shows that, although developed countries have the greatest capacity to develop new technologies, they are failing to fulfil this potential. Framing the energy sustainability discussion and defining a coherent and predictable energy policy are covered in the following chapters, including suggestions that dialogue between policymakers, industry and the general public is increased, and that regulation is clear, basic and simple. The report also discusses the enabling of fertile market conditions to attract investment and the comprehensive fostering of energy technology research and development.

Suggested actions for governments include:

  • develop a long-term vision with challenging but realistic targets
  • implement technology-neutral, goal-driven policy frameworks
  • integrate long-term energy policy with the goals of critical adjacent policies
  • simplify regulation and reducing regulatory uncertainty to attract investment.

Also highlighted is the critical importance of intellectual property rights (IPR) in spurring innovation. The authors argue that IPR is a pre-requisite for private sector involvement and that undermining the IPR system would be counterproductive. IPR is also required in a development context, providing the protection and support that companies in the developing world need in order to partake and compete on a global stage.

This summary was prepared by Eldis.

Sectors: 
Energy