Global Energy Architecture Performance Index Report 2016

Industry AgendaGlobal Energy Architecture Performance Index Report 2016 World Economic Forum91-93 route de la CapiteCH-1223 Cologny/GenevaSwitzerlandTel.: +41 (0)22 869 1212Fax: +41 (0)22 786 2744Email: contact@weforum.orgwww.weforum.org World Economic Forum® © 2016 – All rights reserved. No part of this publication may be reproduced orTransmitted in any form or by any means, includingPhotocopying and recording, or by any informationStorage and retrieval system. REF 161215Prepared in collaboration with Accenture 3Global Energy Architecture Performance Index Report 2016 Contents4 Acknowledgements4 Foreword6 Executive summary9 Energy architecture performance index methodology10 EAPI 2016 results11 Summary of performance and findings16 Energy access and security16 What is energy access and security, and how is it measured?19 How is the concept of energy access and security changing?20 Infrastructure resilience during the energy transition25 Digital to accelerate the energy transition25 Digital and technologies expected to reshape the energy landscape26 Emergence of new threats to energy security28 The new global energy security order32 Conclusion33 Appendices33 Addendum on methodology35 Weights, measures and abbreviations36 ReferencesPrepared in collaboration with Accenture 4Global Energy Architecture Performance Index Report 2016 AcknowledgementsThe World Economic Forum is pleased to acknowledge and thank the individuals and partners listed here, without whom the creation of the global Energy Architecture Performance Index 2016 would not have been possible.Project Adviser: Accenture Arthur Hanna, Senior Managing Director, Energy, Accenture StrategyJames Collins, Managing Director, Energy Strategy, AccentureMike Moore, Project Adviser, New Energy ArchitectureOlivier Queinnec, Lead Author, Accenture Strategy & SustainabilityAdditional acknowledgements: Maria Agostini, Ash Kebriti, Mwenya Kawesha, Fergal Madigan, Jenna Trescott and Marcello DeplanoChief Expert Advisers Morgan Bazilian, Lead Energy Specialist, World Bank David Victor, Professor of International Relations and Director, Laboratory on International Law, University of California, San Diego; Chair, Global Agenda Council on Governance for SustainabilityGiuseppe Montesano, Head, European Energy Policies and Analysis, EnelEirik Wærness, Chief Economist and Vice-President, StatoilData Partners International Energy Agency (IEA), German Federal Enterprise for International Cooperation (GIZ), World Bank Group (WBG), World Trade Organization (WTO), UN SE4ALL, UN Stat division and UNCTADstatWorld Economic Forum Roberto Bocca, Head of Energy Industries, Member of the Executive CommitteeEspen Mehlum, Head of Knowledge Management and Integration, Energy Industries (Project Lead) Thierry Geiger, Head of Analytics and Quantitative Research, Global Competitiveness and RisksKhalid Al-Ahmed, Manager, Knowledge Integration, Energy IndustriesAdditional acknowledgements: Anja Kaspersen The year in energyOver the past year, global conditions have continued to challenge the energy sector. The year has seen changes in energy prices and production, a slowdown in the growth of emerging economies, and geopolitical instability, which effectively reshuffled energy demand and supply scenarios. Both man-made and natural disturbances exacerbate difficulties in predicting the future supply-demand balance as well as the governance of energy resources. In last year’s index report, we highlighted three trends across the pillars of what we call the “energy triangle”: 1. Economic growth and development: The drop in oil prices impacting economic growth2. Environmental sustainability: Ambitious pledges redefining national emissions pathways3. Energy security and access: Energy access and security remaining captive to geopolitical tensions in key producing regions This year can be characterized as a continuation of the same themes. However, the way in which these themes have played out has been both remarkable and unforeseen.Economic growth and developmentLow energy and oil prices, an important theme in the 2015 report, have further impacted economic growth and development. Oil prices this past year were last seen six years ago during the global financial crisis. Supply has consistently outstripped demand by about 1.5 million barrels ForewordArthur HannaSenior Managing DirectorEnergy Accenture StrategyRoberto BoccaHead of Energy Industries Member of the Executive Committee World Economic Forum 5Global Energy Architecture Performance Index Report 2016 of oil per day, as the battle over market share between unconventional oil producers and OPEC countries helped to push world oil supply above the levels at the end of last year by approximately the same amount (1). According to Kenneth Rogoff, Thomas D. Cabot Professor of Public Policy and Professor of Economics, Harvard University, USA (whose insights are included in this report), the current steady l