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VK2AAB > FUEL 26.01.08 07:08l 148 Lines 7027 Bytes #999 (0) @ WW
BID : 55907_VK2AAB
Read: GUEST
Subj: SHELL CEO Peak Oil 2015
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Sent: 080126/0441Z @:VK2AAB.#SYD.NSW.AUS.OC #:55907 [SYDNEY] FBB7.00i
From: VK2AAB@VK2AAB.#SYD.NSW.AUS.OC
To : FUEL@WW
Hello All,
Many people are understandably skeptical about peak oil because it
implies a major change in everything, the way we live, travel, eat and work.
In a word everything and many people just cannot take it in.
Well here is an email from the CEO of the Shell Oil Company who has asked for
it to be distributed outside the company. From the horses mouth so to speak.
73 Barry VK2AAB
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From: Jeroen van der Veer, Chief Executive
To: All Shell employees
Date: 22 January 2008
Subject: Shell Energy Scenarios
Dear Colleagues
In this letter, I'd like to share reflections about how we see
the energy future, and our preferred route to meeting the world's
energy needs. Industry, governments and energy users - that is,
all of us - will face the twin challenge of more energy and less
CO2.
This letter is based on a text I've written for publication in
several newspapers in the coming weeks. You can use it in your
communications externally. There will be more information about
energy scenarios inthe months ahead.
By the year 2100, the world's energy system will be radically
different from today's. Renewable energy like solar, wind,
hydroelectricity and biofuels will make up a large share of the
energy mix, and nuclear energy too will have a place.
Mankind will have found ways of dealing with air pollution and
greenhouse gas emissions. New technologies will have reduced the
amount of energy needed to power buildings and vehicles.
Indeed, the distant future looks bright, but getting there will
be an adventure. At Shell, we think the world will take one of
two possible routes. The first, a scenario we call Scramble,
resembles a race through a mountainous desert. Like an off-road
rally, it promises excitement and fierce competition. However,
the unintended consequence of "more haste" will often be "less
speed" and many will crash along the way.
The alternative scenario, called Blueprints, has some false
starts and develops like a cautious ride on a road that is still
under construction. Whether we arrive safely at our destination
depends on the discipline of the drivers and the ingenuity of all
those involved in the construction effort. Technical innovation
provides for excitement.
Regardless of which route we choose, the world's current
predicament limits our maneuvering room. We are experiencing a
step-change in the growth rate of energy demand due to population
growth and economic development, and Shell estimates that after
2015 supplies of easy-to-access oil and gas will no longer keep
up with demand.
As a result, society has no choice but to add other sources of
energy - renewables , yes, but also more nuclear power and
unconventional fossil fuels such as oil sands. Using more energy
inevitably means emitting more CO2 at a time when climate change
has become a critical global issue.
In the Scramble scenario, nations rush to secure energy resources
for themselves, fearing that energy security is a zero-sum game,
with clear winners and losers. The use of local coal and
homegrown biofuels increases fast.
Taking the path of least resistance, policymakers pay little
attention to curbing energy consumption - until supplies run
short. Likewise, despite much rhetoric, greenhouse gas emissions
are not seriously addressed until major shocks trigger political
reactions. Since these responses are overdue, they are severe and
lead to energy price spikes and volatility.
The other route to the future is less painful, even if the start
is more disorderly. This Blueprints scenario sees numerous
coalitions emerging to take on the challenges of economic
development, energy security and environmental pollution through
cross-border cooperation.
Much innovation occurs at the local level, as major cities
develop links with industry to reduce local emissions. National
governments introduce efficiency standards, taxes and other
policy instruments to improve the environmental performance of
buildings, vehicles and transport fuels.
As calls for harmonization increase, policies converge across the
globe. Cap-and-trade mechanisms that put a cost on industrial CO
2 emissions gain international acceptance. Rising CO2 prices
accelerate innovation, spawning breakthroughs. A growing number
of cars are powered by electricity and hydrogen, while industrial
facilities are fitted with technology to capture CO 2 and store
it underground.
Against the backdrop of these two equally plausible scenarios, we
will only know in a few years whether December's Bali declaration
on climate change was just rhetoric or the beginning of a global
effort to counter it. Much will depend on how attitudes evolve in
Beijing, Brussels, New Delhi and Washington.
Shell traditionally uses its scenarios to prepare for the future
without expressing a preference for one over another. But, faced
with the need to manage climate risk for our investors and our
grandchildren, we believe the Blueprints outcomes provide the
best balance between economy, energy and environment.
For a second opinion, we appealed to climate change calculations
made at the Massachusetts Institute of Technology. These
calculations indicate that a Blueprints world with CO2 capture
and storage results in the least amount of climate change,
provided emissions of other major manmade greenhouse gases are
similarly reduced.
The sobering reality is that the Blueprints scenario will only
come to pass if policymakers agree a global approach to emissions
trading and actively promote energy efficiency and new technology
in four sectors: heat and power generation, industry, mobility
and buildings. It will be hard work and there is little time.
For instance, Blueprints assumes CO2 is captured at 90% of all
coal- and gas-fired power plants in developed countries in 2050,
plus at least 50% of those in non-OECD countries. Today, there
are none. Since CO2 capture and storage adds cost and brings no
revenues , government support is needed to make it happen quickly
on a scale large enough to affect global emissions. At the very
least, companies should earn carbon credits for the CO2 they
capture and store.
Blueprints will not be easy. But it offers the world the best
chance of reaching a sustainable energy future unscathed, so we
should explore this route with the same ingenuity and persistence
that put humans on the moon and created the digital age.
The world faces a long voyage before it reaches a low-carbon
energy system. Companies can suggest possible routes to get
there, but governments are in the driving seat. And governments
will determine whether we should prepare for a bitter competition
or a true team effort.
That is the article, and how I see our challenges and
opportunities. I look forward to hearing how you see the
situation (please be concise).
Regards
Jeroen van der Veer, Chief Executive
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