The year 2021 began with high hopes for climate action, as many members of the international community—including, once again, the US—rededicated themselves to the effort and looked to deploy resources accordingly. And there were certainly landmark achievements: the Global Methane Pledge was launched, the Paris Agreement rulebook was completed, and the private holders of $130 trillion in assets under management pledged their collective financial muscle to the fight against climate change, among other victories. But as global economic demand roared back from its pandemic-dampened level in 2020, energy supply failed to keep up, inflating hydrocarbon prices, driving countries back to dirty coal generation, and underscoring the challenges of the “transition” part of the energy transition. It became clear that countries will need to thread the needle between pushing for ambitious emissions reductions and keeping prices down and the lights on in the interim, all against an ever more precarious geopolitical backdrop.
With these considerations in mind, The 2022 Global Energy Agenda details a more pessimistic outlook on the promise of the energy transition, as respondents reckoned with concerns old and new. In these pages, experts offer ways forward in the face of hazards like Russian aggression, supply-demand mismatch, and a transition that threatens to leave the global poor behind. Though the pitfalls that emerged in 2021 gave many pause, this report reveals that leaders are no less determined to find solutions, and to chart a more stable and inclusive course in 2022.
2021 was supposed to have been a game-changing year of climate action
As we begin 2022, still under the shadow of the COVID-19 pandemic, it may seem as though much of the world remains in a holding pattern. 2021 began with optimism but saw the continual resurgence of the pandemic, forcing world leaders to turn their attention and resources to fighting it back repeatedly. Still, 2021 was a significant year in energy and climate and much was accomplished. Crucially, global leaders were able to convene—for the first time since 2019—in Scotland at the 2021 United Nations Climate Change Conference (COP26). And while the outcomes are to be lauded, many observers left Glasgow feeling that more could have been accomplished.
This second edition of the inaugural agenda once again sets the stage for the upcoming year. Energy leaders polled from governments, industry, think tanks, and academia, capturing their views of the most important trends to watch and the ways in which we can work together to shape the global energy agenda. As with last year, the key indicator of how respondents answered the survey questions was, on the one hand, respondents who believed that peak oil demand had already occurred or would do so in the near-term and, on the other hand, respondents who believed that peak oil demand would not happen until 2040 at the earliest.
This year, there were two dramatic differences in survey answers from 2020. The first is that respondents’ prediction of when oil demand will peak shifted back by several years, suggesting they now think the energy transition is happening more slowly than they thought last year. Second, respondents’ views on the impact of COVID-19 on the energy system changed.
In 2020, COVID-19 was seen as the biggest geopolitical risk to energy supply and production, but this year, cyber-attacks were viewed as the greatest geopolitical risk.
Looking ahead, there will be even greater climate commitments made at COP27 in Egypt (to be followed by COP28 in the United Arab Emirates). We hope this is the year when we leave the worst of COVID-19 behind, which can only happen through the kind of global cooperation that will also be necessary to combat climate change and all of the other unforeseen challenges that this century is likely to present.
