By Murat Temizer
ISTANBUL
The real winners of energy will come from countries that are able to adapt to the unique technologies for sustainable energy at affordable prices, Urban Rusnak, secretary general of the International Energy Charter, said Thursday.
Rusnak told Anadolu Agency at the 22nd World Petroleum Congress in an exclusive interview that for a country like Turkey, which is at a high level of development, it is important to use all affordable energy sources and to develop a very diversified energy portfolio -- the best strategy for the country.
"The Turkish government applies this currently," he noted.
Rusnak said that current global energy players are at the crossroads of very different trends and very fast technological development. He added that it is difficult to predict what technology will be considered essential, and therefore advised to hedge bets on all upcoming technologies.
Technology solutions are changing at such a fast pace that those that were deemed developing technologies a couple of years ago are now considered critical. He cited the example of carbon capture and storage in this context.
"This is a period of winners emerging not from countries with traditional advantages like oil, gas coal and big fleets," Rusnak said adding, "The real winners will come from countries that are able to adapt themselves to the unique technologies for sustainable energy with affordable prices. What are those unique technologies? It's very hard to say."
Greater photovoltaic efficiency, industrial-scale affordable storage - key for major change
Rusnak emphasized that renewables could be a winning solution if coupled with very efficient storage technology.
"Personally, I don't think the current level of renewables technology at an industrial scale is efficient enough to provide universal solutions. It could be in the future, but to make this happen we have to solve two major issues. We should increase the efficiency of photovoltaics -- a universal source of sunlight and the second issue is affordable storage at an industrial scale," he explained.
"We cannot just have one of them, we should have both. But if this happens, it would change everything in the energy world and in societies as well," he said.
Similarly, Rusnak recounted the monumental changes made within a lifetime in the communication sector with technological progress that transfigured fixed-line phones into omnipresent smartphones with ever-growing computing power and new functionalities.
"Within the past 20 years this technology has changed our societies and we have not seen the final impact yet. We have to expect a similar level of disruption as a result of energy sector transformations in the next 20 years," he said.
He also stressed that diversification in all areas is the most rational policy for development. "We shouldn't be narrow-minded. All countries should consider many options," he argued.
Australia to take Qatar's LNG leadership
The liquefied natural gas (LNG) market is a fuel that will see many changes in the near future, Rusnak asserted.
"We have to take into account that Qatar will not lead in LNG anymore. So probably in the coming one to two years Australia may overtake as the biggest supplier," he said.
"The U.S. is one of the biggest consumers and producers of gas, but I don't think they will become a major supplier in the global market. They may construct many LNG terminals but there is the question of price. We may end up with a price war in gas and gas-to-gas competition."
He maintains that the question for gas prices is in the extent to which it can drop down and still be sustainable.
Only part of the gas chain will continue to be traded and linked to oil, Rusnak said and explained, "I see that overall in the medium term, the gas market will face a very significant oversupply on a global scale. We may see a very similar picture as we see in oil now."
He projected that the escalation of competition between traditional and shale producers will occur in the coming decade, warning that "we don't have an immediate picture."
UAE's membership to Energy Charter
At the end of June, the United Arab Emirates (UAE) became the first country of the Gulf Cooperation Council to sign the Declaration, joining the International Energy Charter family.
The Energy Charter Treaty provides a multilateral framework for energy cooperation that is unique under international law. It is designed to promote energy security through the operation of more open and competitive energy markets while respecting the principles of sustainable development and sovereignty over energy resources.
"I would like to make an important remark here. Since the International Energy Charter was agreed, the process was open to beyond its traditional area. All countries in the International Energy Charter are looking to build bridges. Our organization has always been designed to accommodate the interests of energy producing, consuming and transiting countries and it is not working in favor of one group.
"It's about protecting, promoting investment and increasing energy cooperation. For example at the beginning, Azerbaijan and Kazakhstan used to be countries consuming investments, but in five years they followed the same logic as some petroleum-rich nations and have been doing so for some time and now they have become investors down in the value chain in the EU and Turkey," he said.
The Energy Charter Treaty was signed in December 1994 and entered into legal force in April 1998.
