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BIPR | Johns Hopkins SAIS Global Risk Conference - Climate and Energy Risks: Persistent and Emerging
Johns Hopkins SAIS Global Risk Conference - Climate and Energy Risks: Persistent and Emerging
The discussion began with Simon Blakey's insights on global energy security. He explained that the 1973 oil crisis and its subsequent economic shock placed energy supply security firmly on the international agenda, leading, among other things, to the creation of the International Energy Agency. Blakey outlined three key dimensions of energy security that are crucial for policymakers. The first is diplomatic and military leverage, as demonstrated first by the 1973 oil embargo of the Organization of Arab Petroleum Exporting countries against the US and Netherlands., More recently, the diplomatic leverage of energy security was highlighted by Russian gas supply disruptions to Europe, underlining Putin's attempt to create divisions in Europe. In the future, this dimension will likely center around critical minerals and rare earths. Related to this is the second dimension: economic consequences. As an example, Blakey named the quadrupling of oil process in the 1970s that ultimately increased unemployment and inflation, spunning the economy into a severe recession. Finally, Blakey emphasized the public impact, such as rising energy bills and the cost of living, which can trigger domestic political unrest. Governments, as seen in the massive subsidies for heating bills across Europe after the 2022 energy crisis, pay particular attention to this third dimension. Blakey also noted that the energy landscape is diversifying to reduce reliance on any single energy source. However, while industrialized countries are using relatively less oil today and are increasingly relying on renewables, nuclear or natural gas, oil demand is still considerably high in emerging economies.
Following this, Jesse Scott offered her remarks on the nexus of energy and climate change. She highlighted that climate change acts as a systemic risk and will completely reshape traditional security concerns and disrupt the status quo. Climate change and the energy sector are deeply intertwined, with 75% of all greenhouse gas emissions stemming from energy production and use. Energy demand is on an all-time high due to growing populations and prosperity, creating unprecedented GHG emissions. Therefore, significant changes in energy efficiency as well as to the energy mix are critical. This can only be achieved by shifting to renewables and accelarating electrification. Scott also pointed out that climate action itself can impact energy security, citing extreme weather events that damage energy infrastructure. Thus, we must not only adapt to ongoing changes but also rethink our concept of energy security, shifting focus toward technological solutions that ensure reliability and flexibility.
Building on these points, Marco Dell'Aquila noted that the growth of renewable energy over recent decades has been impressive and unprecedented. However, he warned against the misconception that this growth will continue indefinitely without challenges. Dell'Aquila highlighted the private sector's increasing role in energy markets, which introduces new risks, unlike past energy shocks that were managed primarily by governments. To make future technological solutions viable, incentives must be created without overburdening consumers.
In conclusion, the panelists agreed that the winners in the medium term—whether companies or countries—will be those that invest in clean energy. For this to happen, clear climate agendas and strong policy signals are essential.
Johns Hopkins SAIS Global Risk Conference - Climate and Energy Risks: Persistent and Emerging
The conference has been made possible with the generous support of Mr. James K. Anderson, SAIS Europe Alumnus and Advisory Council member, and Johns Hopkins University Trustee.
hosted by Professor
Michael Leigh
Simon Blakey
European University Institute
Jesse Scott
Hertie School; European Climate Foundation; German Economic Research Institute DIW Berlin; Observer Research Foundation, New Delhi
Marco Dell'Aquila
Discussant: SAIS Europe; inspiratia
SIMON BLAKEY
Simon Blakey is Senior Fellow at the School of Transnational Governance, European University Institute in Fiesole. He is a leading authority on the European energy industry and its global dependencies, in particular the Europe-Russia natural gas relationship and its changing character from the 1980s to today. With four decades of experience at the intersection of geopolitics, energy economics, climate change, working on government policies and business strategies, Blakey has provided strategic advice to corporations, and energy policy advice to governments and government agencies around the world. Most of his career has been with Cambridge Energy Research Associates (now S & P Global Commodities Insights, where he is a Senior Adviser). He has also spent five years at the International Energy Agency in Paris, and three years as Special Envoy at an industry association in Brussels. Blakey is a co-author, together with Daniel Yergin (Pulitzer Prize) and Professor Thane Gustafson (Georgetown University) of several landmark studies on the Russian-European commercial and political relationship, including the evolution of the Russian-Ukrainian gas crisis of 2009 and the European response. He is a regular speaker/chair at CERAWeek (the energy sector Davos) and other high-level global energy and strategy gatherings. As a Senior Visiting Fellow at the STG, Blakey has been consulting colleagues for wide and diverse perspectives on future frameworks for global governance, including views on the future of Russia in its relations with Europe and the world. He expects this diversity of view to be valuable input for a book he is writing, developing plausible scenarios for the future of Russia and the Russian-European relationship.
JESSE SCOTT
Jesse Scott is Adjunct Professor at the Hertie School. She is currently on sabbatical doing projects with the European Climate Foundation, the German Economic Research Institute DIW Berlin, and the Observer Research Foundation in New Delhi. An expert and global practitioner in policy-making and stakeholder engagement in the field of climate change and the clean energy transition, she has worked in Europe and globally, in international and national government and in civil society. Until September 2022, Scott was International Director at thinktank Agora Energiewende, and in 2015-17 worked at the OECD International Energy Agency where she co-authored the first significant assessment of the impact of digitalisation on energy systems. Previously she worked for 15 years in Brussels where she campaigned – with many ‘wins' – on EU energy and climate policy. Her experience includes building non-profit think tanks in emerging economies, advising EU Presidencies, business lobbying (Deputy Secretary General at natural gas association Eurogas, Head of Environment at electricity association Eurelectric), and leading NGOs. Her current research and policy work focuses on how Europe can support energy transitions in emerging and developing economies, in particular with regard to "just transitions" for vulnerable social groups and communities, and on rethinking the concept of political risk in light of climate change and the implications for high costs of capital for renewables investments. Scott studied at Cambridge University and the European University Institute in Florence .
MARCO DELL'AQUILA
Marco Dell'Aquila is Senior Adjunct Professor at SAIS Europe; Co-Founder and Chairman, inspiratia; Founder and Chairman, Power Capital. Dell'Aquila has taught at SAIS since 2011 and is a member of the SAIS Europe Advisory Council. As Chairman of inspiratia and previously IJGlobal, He has spent 25 years as an author and commentator on the evolution of energy and infrastructure markets, as well as regulation and emerging technologies to combat climate change. He has also advised on numerous energy transactions around the world spanning virtually all forms of cleantech and renewables. He is currently CIO of a UK green hydrogen company. Dell'Aquila has a BSc (Tech) in Civil and Structural Engineering from the University of Manchester and an MA in International Relations and Economics from SAIS.