In Response to the COVID-19 Pandemic

As the COVID-19 pandemic continues to impact every corner of the world, pulling together as a community of deep expertise has never been more important - to share experiences and lessons learned, and better prepare for and shape what comes next. Our role as a credible, responsible and impartial value-adding “global voice” for whole energy system movement has never been more critical.

Find Out More

CEO View: Preparing for what comes next, starts now

21st April 2020

ViewsGlobalCovid-19

As citizens, communities, companies and countries, we are all still learning how to cope with the impacts of this global pandemic. But now is also the time to start to prepare for what comes next – will there be a steady return to ‘normal’ or a ‘new normal’ in a very different post-COVID-19 world.

To help our members survive and thrive these turbulent times we are gathering and sharing new insights on business impact and continuity planning from every region and sector by surveying our member organisations in nearly 100 countries. We are also building a set of medium-term, post-crisis scenarios to focus on the future –in term of the longer-term implications for energy sectors and the outlook for global energy transition. Clearly an important starting point is to identify what we know and don’t know about the virus and engage different perspectives on the fast changing situation.

Three Critical Uncertainties

From the global future outlook survey of our members and review of their commentaries, three critical uncertainties emerge as the major factors in shaping the pace and direction of energy transition in the post-COVID-19 crisis era:

Virus Mutation and Epidemiology

Seasonality and mutation of the virus, including medical response and vaccine development, is understandably a critical uncertainty. Even though the majority of our survey respondents expect that a vaccine will be developed in the next 18 months, they also highlight the diversity in containment strategies and challenges in conclusive medical testing. The outlook is uncertain – will there be a short, seasonal and well-managed crisis or will the virus mutate and difficult and drawn out ‘dance’ over several years.

Economic and Trade Impacts

Even before the crisis, some energy companies were preparing economic recession scenarios. The crisis has severely disrupted global value chains and many economic activities have come to a halt. This wider disruption contributes a ‘perfect storm’ of conditions for longer-term energy crisis - low oil price, capex cuts, defaults on payments by companies and countries coupled with the prospect of a rise in the cost of debt servicing that paint a grim picture. Global survey responses highlight a common expectation for a global recession that will last longer than a year, and with the possibility of fundamental financial system adjustments and significant disruption of global value chains and trade patterns. Will recovery be swift or slow, even or uneven and with renewal of the existing global order or the emergence of new and different alternatives to the multilateral system?

Societal Shifts

Responses to the crisis have included extended periods of self-isolation and social distancing which carry immediate and longer-term implications for emotional resilience, social norms, individual behavioural change, trust and social cohesion. Survey responses highlight the resilience of public services to global system shocks and changes of public trust as key uncertainties. And more than 30% of respondents indicate a ‘new normal’ will emerge and require changes to the social contract and reorganisation of society.  How might societal responses to the COVID-19 crisis usher in a new era of radical, rather than incremental policies? Will there be demand for investment in whole system resilience – not only the flow of electrons and molecules and individual firms– but the resilience of people and control rooms,  whole communities and sectors and global value chains?

Moving Forward

Preparing energy workers, energy firms and energy communities for a new and different operating context cannot rely on waiting to predict what will happen or deciding what we would prefer to see happen. We can better prepare for and help shape the emerging and uncertain future by equipping our global community with a set of plausible and alternative scenarios of what might happen and use them to explore and navigate : How can we emerge from the COVID-19 shock as a more resilient society and continue to accelerate a successful global energy transition? 

Stay tuned for our Plausible Post-Crisis Scenarios!

Comments

No comments have been posted

Post a new Comment

Join the World Energy Council

Engage in strategic dialogue with the energy leaders of today and the future, build capabilities and help shape the energy future.