Geopolitical, sociological, and economic factors that shape the future of the energy sector
Current global energy consumption forecasts indicate that although renewables are set to expand by 50% between 2020 and 2025, they will not fully replace fossil fuels in our lifetimes. However, if recent geopolitical, economic, and sociological factors are taken into account, this prediction becomes obsolete. The world is about to enter a period of rapid energy transformation.
In today’s unprecedented setting, what previously was estimated as a gradual «not-in-our-life-time» transition to 100% renewable energy usage is expected to occur at an accelerated rate and could now happen during our imaginable lifetime. Less obvious but highly impactful factors that are currently transforming the world energy mix are the China – USA war of domination, the consequential decoupling of supply chains caused by the end of the globalization era and the COVID-19 pandemic.
These factors have created an immediate need for an accelerated process of industry digitalization,
regionalization of the energy supplies, and an extensive transformation of the industry workforce. These changes will create a further decrease in the demand for fossil fuels energy sources in certain parts of the world and push production rates in gradual decline. Direct outcome of such circumstances for governments across the world is the threat to the security of global energy supply chains and disruption of stable energy flow. In order to obtain such security, fossil fuel poor regions of the world will turn towards the energy source which is available in one form or another in most geographic locations – renewables.
Here, an overview of these new geopolitical, economic, and sociological worldwide factors that have a direct impact on the energy sector is presented.
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