CNET NEWS.COM: Shell CEO offers oil-centric view on energy, climate change

Posted by Martin LaMonica
January 28, 2008 7:14 AM PST

The CEO of oil giant Royal Dutch Shell Jeroen van der Veer sees an end to easy oil and a potential worldwide “scramble” to mitigate climate change.

On Friday, van der Veer outlined to potential scenarios for energy usage and extraction over the coming century in a speech published on the company’s Web site. 

Regardless of whether countries “scramble” or take in a more orderly approach to adopting low-carbon fuels and renewable energies, getting oil and gasoline not be as easy as it once was, he said.

“We are experiencing a step-change in the growth rate of energy demand due to rising population and economic development,” he wrote.

“After 2015, easily accessible supplies of oil and gas probably will no longer keep up with demand.”

There is an ongoing “Peak Oil” debate were some people argue that global oil reserves has peaked and will start declining. van der Veer holds the view that oil will be more certainly be more difficult and expensive to extract in the future, a case outlined in this recent Wall Street Journal article.

In Shell’s Blueprint scenario where government policies favor low-carbon technologies, there will be widespread use of carbon capture at coal-fired power plants–90 percent by 2050. Currently, there are only a handful of experimental sites.

Carbon cap and trade regulations are adopted worldwide in this scenario and there is a sharp uptick in the use of home-grown biofuels and local coal.

Like many others, he compares the quest for low-carbon energy technologies to the sense of mission attached to putting humans on the moon.

“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 driver’s seat. And governments will determine whether we should prepare for bitter competition or a true team effort,” he concluded.

There is a divergence among the giant global oil companies and their commitment to funding alternatives to oil.

Shell has already diversified into biofuels including investments in cellulosic ethanol ventures. It is also partnered with small technology companies to make by a diesel from algae and other nonfood sources.

Research company New Energy Finance last Friday released a report echoing van der Veer’s view that the pace of investments in energy efficiency and low-carbon energy technology needs to increase.

New Energy Finance said that investments will need to triple in the next five years if climate change abatement targets are to be met. Last week, the European Union set out targets to have 20 percent of its energy in the 27-country area come from renewable sources by 2020.

More discussion of Shell and peak oil at the Oil Drum.

http://www.news.com/8301-11128_3-9859318-54.html

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