Balancing energy transition involves trade-offs between security, price volatility, and affordability.
Regulations like Article 6 are crucial for consistent carbon measurement and addressing climate challenges.
Deep dives
Challenges in the Energy Transition and Impact of Energy Costs
The recent surge in global energy prices, particularly gas, has led to over 25 energy providers in the UK collapsing, sparking discussions on the energy transition's complexity and the balance between decarbonization, supply security, and affordability. This transition, driven by policies rather than cost competitiveness, necessitates a better understanding of short-term energy security implications and social consequences.
Key Points from COP26 and Energy Transition Regulations
The importance of regulations like Article 6 for consistent carbon measurement at the country and company levels emerged as a significant outcome of COP26, fostering systematic efforts to address climate challenges. While COP26 showcased a shift away from coal and fossil fuels, the focus was primarily on the supply side, highlighting the need for coordinated efforts to manage energy demand and supply flexibly.
Flexibility and Transition Challenges in Energy Supply
The recent energy shock, manifesting in high gas prices, underscores the importance of system flexibility to mitigate risks and maintain stable prices. While renewable energy like wind plays a crucial role, the inflexibility of such sources underscores the need for flexible and decarbonized energy solutions like hydrogen to ensure a balanced energy mix.
Navigating Scope 3 Emissions and Sustainable Investment Expectations
The challenge of addressing scope 3 emissions, influenced by factors beyond a company's control, highlights the need for a consistent methodology across the industry to measure and mitigate carbon footprints effectively. Energy companies, faced with evolving investor expectations, are transitioning towards cleaner practices and reporting transparency to align with sustainable goals.
Is this latest energy shock a one-off event or a harbinger of more energy crises to come? Listen to Jason Mitchell discuss with Alex Grant, Equinor’s Senior Vice President of Business Development and UK Country Manager, the energy transition; the trade-offs that we may face between security of supply, price volatility and affordability; and the emerging energy technologies like blue and green hydrogen.
Alex Grant is Equinor’s Senior Vice President of Business Development Origination and Execution as well as its UK Country Manager. Alex joined Equinor from Jefferies in 2017. His background is in investment banking where he worked on M&A and financing transactions over the past 20 years in the energy sector.
Find the full transcript of this episode here: www.man.com/maninstitute/a-sustainable-future-podcast
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