Seven Challenges for the Energy Sector

Economic growth requires secure access to energy resources – at a given time and place, and at the correct price. Ten years ago, costs still seemed to be the only challenge. Recent years, however, have shown that physical access is another: a major share of global resources sits in politically unstable locations. Even if we are successful in securing energy sources elsewhere, the timing may not be as expected, and the price might not allow for sustainable development. The energy crisis and its impact on the gas market (affecting the power market, in turn) was an example of this. Once we add climate issues, and the resulting full rolling economic costs, into the mix, the scale of incentive systems thrown in for good measure, we can only conclude that building an effective energy market under such conditions is exceedingly difficult, making regulatory backing necessary.