Recent technology advances in efficiency management, unconventional fossil fuels and clean energy "have fundamentally changed the energy game and redrawn the global energy map," according to a white paper issued by Joseph A. Stanislaw, an independent adviser to Deloitte LLP.
"Cutting edge technology -- hardware and, especially, software -- is unlocking geological potential in places and ways hardly imaginable even a few years ago," Stanislaw wrote in "Energy's Next Frontiers -- How Technology is Radically Reshaping Supply, Demand and the Energy of Geopolitics," which was released Monday in conjunction with the two-day Deloitte Energy Conference in Washington, DC. "Energy companies now rank among the most important -- and sophisticated -- technology companies in the world."
Venture capitalists invested $275 million in start-ups that make software and other technologies to manage energy use in 2011, a 75% increase compared with 2010, Stanislaw said. Renewable energy is expected to be an $800 billion global market by 2015, nuclear power "is growing at a pace not seen in decades" and energy storage is poised for major technological breakthroughs, according to the report.
"The economic, environmental and geopolitical consequences of this technological transformation are breathtaking...today, alongside traditional powers like Saudi Arabia and the United Arab Emirates, Brazil is becoming an energy superpower and Canada is reinforcing its position as one, as is Russia. Also joining the ranks of growing energy producers are countries like the Philippines, Argentina, Angola and Suriname (all thanks to deepwater drilling), and Poland (shale gas). In Israel, massive recent gas discoveries are upending the energy and political calculus..."
But Stanislaw believes the geopolitical consequences of the technology advances may be greatest in the United States.
"If five years ago you had asked 'which country in which region of the world can be totally energy self-sufficient?' no one would have guessed the United States. Yet now, the revelation of North America's massive shale gas and oil reserves, combined with the technological innovations that unlock their potential, are helping bring into focus the tantalizing prospect of energy independence for the United States."
Limiting the energy industry's growth are public concerns about environmental issues, rekindled by the Macondo blowout in the Gulf of Mexico, the Fukushima nuclear incident in Japan and the ongoing debate over hydraulic fracturing.
The keys to energy success for governments will be the development of "visionary and stable" national energy policies, construction of state-of-the-art national energy infrastructure, and "deep, long-term commitments" to research and development. After that, governments need to "get out of the way and let the players in the energy game determine which technologies win and which lose."
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