Davos Roundup: Climate Deal is Dead, Long Live Big Oil
As world leaders gather to discuss economic problems during the Davos talks, energy execs are calling for a new peak in oil production, and others cite bleak hope for any global climate deal.
Davos, a Swiss ski resort, is the location of the World Economic Forum, which runs through Jan. 31.
At a dinner on alternative energy, about 100 were in attendance, and when asked to raise their hands if they thought a U.S. climate bill would pass Congress before June, no one raised their hand, reports Foreign Policy. About 60 of those in attendance were Americans.
That view is contradicted by Duke Energy CEO Jim Rogers, who said that he still expects cap and trade to take shape in the U.S., reports Reuters. Rogers said that the Democrats’ loss of a seat in Massachusetts was far from the death-knell, that instead a stronger, more bipartisan approach to climate legislation may emerge.
Tony Hayward, CEO of BP, said that there is a “supply challenge” for the oil industry that will necessitate an extra 15 million barrels of oil a day over the coming 20 years, reports the Telegraph. The world currently is producing about 84 million barrels a day. While demand for oil is fading in the U.S. and Europe, it is rising rapidly in Asia.
Hayward said that natural gas extracted from shale or methane reserves is a “game changer” in the U.S. energy market, reports Reuters.
Still others see the promise in renewable energy.
Siemens and ABB said they expect to see demand for renewable energy to continue to rise, despite the global economic slump, reports the Wall Street Journal.
Siemens said its “green portfolio” grew 11 percent in 2009 to $32 billion. That number is expected to reach $35 billion this year.
ABB cited annual green energy sales of about $2 billion, or 10 percent of its revenues.
The emergence of more renewable energy will mean big business deals for companies that integrate the systems into electrical grids, said Peter Leupp, head of ABB’s Power Systems division.
In other Davos-related climate change news, participants cautioned about the dangers of derivatives in carbon trading, reports Reuters.
Feike Sijbesma, CEO of Dutch chemicals group DSM, said that he has been “amazed” at the growth in financial markets for CO2 allowances.
“I think we learnt a lesson from the financial crisis. If we develop products which we don’t understand then we run into dangers,” he said, adding that stronger market regulation was necessary.
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