2007 Global Energy Survey

Supply Pressures

Re-enter Nuclear? Coal Accelerated?

While eight in 10 survey respondents do not expect serious supply shortages in any of the major energy bundles, the medium term holds significant promise for the nuclear sector. More than seven in 10 executives believe that nuclear energy is extremely important, compared to other energy types, when considering a sustainable energy strategy. Not surprisingly, more than 80 percent of respondents believe that nuclear energy will reenter serious discussions throughout the world during the next three years. Further more, 72 percent of respondents expect a 1-10 percent increase in nuclear to occur during the next decade. The long term impact of nuclear waste on the environment remains a risk factor: three in 10 executives do not believe that an adequate model to price the cost of disposal and effects of nuclear waste on posterity – as well as  potential for nuclear disaster (accidental or purposeful) – exists today.That shortcoming could deter public confidence.

Half of executives surveyed believe that coal will provide the most reliable backbone for electricity supply to consumer and industrial users over the medium term, while six out of every 10 respondents identified hydroelectric as a very important source of energy over the same period.

In addition, more than 90 percent of executives surveyed expect significant investment increases (more than 5 percent annually) in infrastructure development across energy sectors. These expectations are reflected in the IEA’s Outlook study, which suggests a cumulative, global investment of $20 trillion over next 25 years in energy-supply infrastructure. This projection is approximately $3 trillion higher than previous projections. China’s investment requirements are estimated at $3.7 trillion or 18 percent of the global total. More than half of all energy investments worldwide are needed in developing countries.

Increases in alternative fuels (e.g., bio fuels) are expected to be significant, according to 60 percent of respondents. In absolute terms, though, alternative fuels will remain a small portion of the overall energy mix. That said, 40  percent of respondents expect serious government involvement and pressure to encourage development and investment in alternative fuels throughout the world.

On the issue of alternative energy sources, 40 percent of respondents identify wind as very relevant from a supply perspective over the next three to five years. Another 40 percent of respondents describe solar power as “somewhat important.”

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