Nature and Biodiversity

Geopolitics, the equitable transition, and AI: things to look out for in energy in 2024

White clouds over wind turbine: The green energy transition has to be fair across the board but AI and geopolitics could be game-changers.

The green energy transition has to be fair across the board but AI and geopolitics could be game-changers. Image: Unsplash/Karsten Würth

Robin Pomeroy
Podcast Editor, World Economic Forum
Sophia Akram
Writer, Forum Agenda
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This article is part of: Centre for Energy and Materials
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  • What are the top issues for the energy sector in 2024?
  • Two experts give their read-out from Davos 2024.
  • Listen to the podcast here, or on any podcast app via this link, or on YouTube.

"The environmental case for the energy transition is very clear. Now we need to accelerate on the business and economic case."

So says Roberto Bocca, head of the Centre for Energy and Materials at the World Economic Forum, in the latest Radio Davos podcast in which he and John Defterios, professor of business at New York University Abu Dhabi, discuss the main issues facing the energy sector coming out of the Forum's Annual Meeting in Davos 2024.

Here are some of the highlights of their conversation:

Have you read?

The big themes from Davos: transition, demand and equity

Roberto Bocca: We have three big, big themes.

The first one was how we move forward with the business case and the economic case for the energy transition. The environmental case is very clear. But now we need to make things happen. We need to accelerate, and the business and economics is a critical one. That is the first topic.

The second one is the element of addressing energy demand, how we can be more efficient in the way we use energy.

And the third element is the element of energy equity. There is no transition if there's not an equitable transition. And so we really had a lot of conversation between the so-called global South and global North to make sure there is not such a division, but we are really focussed on a transition that is for everyone.

John Defterios: In 2024 ... it is the complexity of the energy transition. We're building a new system. Everybody wants to move that at rapid speed here. But we're recognising there's going to be some complexity along the way ...

It's still extraordinary. You have 775 million people that don't have access to energy, and 2.3 billion people that don't have access to clean cooking facilities in the 21st century.

So, yes, we want to make the transition. [...] But you have to make sure no one's left behind. [...] SDG 7 is for everybody to have access to reasonable cost energy around the world, and we can't forget that in this process.

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The impact of AI on energy

Roberto Bocca: There are two dimensions.

There is this dimension of how much artificial intelligence can accelerate and help us when it comes to efficiency, because the fast elaboration of data can really optimise when you think of the building or the lighting or the heating system, etc., there is amazing opportunity there. We are talking about 25% of improvement when it comes to efficiency in that case. So that's one.

The other one is how much energy the elaboration of data will require when it comes to artificial intelligence. And that will be a big issue. It is a big issue in terms of additional energy demand.

John Defterios: The efficiencies AI could provide in the field ... resource management of oil and gas ... efficiency of your pipeline system in observing leaks in the system itself, methane tracking.

The AI revolution. We don't know what the revolution looks like in energy yet, but it should have quite a big impact on demand [...] and hopefully allowing us to be a lot more efficient.

Geopolitics, energy’s constant game-changer

Roberto Bocca: Geopolitics has been, is and will be always at the forefront of energy.

There are new dynamics. There is not only the one that we knew in the past of oil and gas. There is also all the dimension of the materials, the materials that are needed, especially for the new energy system being solar, wind and and batteries and so on.

John Defterios: We don't know how U.S. and China unfold [...] they're both vital to the energy transition. So they're going to compete with each other quite fiercely when it comes to business. The US made it very clear with Jake Sullivan, the national security advisor to President Biden, that they're not going to retreat from the Asia Pacific. And that kind of gives us that uncertainty, how fast we can move on the energy transition when we have the number one and number two powers, competing fiercely with each other.

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