The energy industry was under strain even before the pandemic, which exacerbated these weaknesses and led to the biggest ever decline in energy demand and sharply lower oil and gas prices, according to the World Energy Council’s global survey
The COVID-19 pandemic will have a fundamental impact on the world’s energy systems and on the pace and direction of the global transition.
Dramatic cuts in spending and a reallocation of funds into digital solutions and environmental sustainability are among some of the most significant changes likely to emerge as a result of the COVID-19 crisis.
The findings from these global surveys indicate that COVID-19 is driving an historic reallocation of investment which will impact future energy developments. The World Energy Council has also identified a three-stage model being adopted by energy companies in response to the COVID-crisis: Respond-Rebuild-Recreate. The findings indicate that some energy firms are already entering the Rebuild stage and re-allocating capital and resources.
Some of the major findings from the survey which gathered responses from 225 energy experts in 61 countries across six continents include:
A third of energy companies plan to shed jobs. This might mean 350,000 jobs at risk across the G7 economies.
Four out of five energy businesses plan drastic cost reductions.
Around 80 per cent of organisations are making significant reallocation in investments towards digitalisation, R&D programmes and Environmental, Social and Governance (ESG) activities.
The Council is working with all major players across the energy world to test and design exit strategies that help manage progress in global energy transition for the benefit of all. These global surveys have informed the development of a set of four plausible post-crisis scenarios which describe alternative pathways for global energy transition.
Dr Angela Wilkinson, secretary general and CEO, World Energy Council, commented, “The COVID-19 crisis is triggering the greatest financial capital re-allocation in history. No-one can predict the future. Only by convening informed and diverse viewpoints can the energy world help avoid a next global crisis and better prepare for the new normal. Now is the moment to shape a future of better energy for everyone and the environment."
The future of energy after COVID-19 was discussed during an online conference on 17 June, marking the launch of the Road to Congress 2022 online event series. Alexander Novak, Minister of Energy of the Russian Federation General and Dr Angela Wilkinson, the Secretary General and CEO of the World Energy Council, were joined by leading experts in the energy sector to discuss their vision of the transition to a ‘new normal’ after the crisis.
