Rick Dobson, Regional Director, Fuels Marketing Europe, spoke recently at the European Voice Conference on ‘Fuels for a Future Generation’ in Brussels.  Flanked by speakers from the European Commission and Unesco giving the policy perspective, Dobson offered an industry view on Europe’s energy outlook, the search for alternative fuels and some thoughts on the longer term options for transportation.

Worldwide energy demand is expected to grow by over 40% in the next twenty years, despite gains in energy efficiency. This is mainly due to anticipated economic growth in the developing world – which will accounts for 80% of this figure.

Alternative sources are growing while oil and gas likely to remain predominant
ExxonMobil believes that energy demand in Western Europe will grow about 0.5% annually and that several different types of energy will be necessary in the energy ‘mix’ to satisfy this demand. Fossil fuels will continue to be an essential source of energy with oil demand growing at about 0.1%, coal losing share at about 1% a year and the big gainer being gas growing at 2.2.%. In non-fossil fuels, nuclear will decrease its share to about 10% of total energy in 2020 with a small increase in hydro and biomass. While the strongest growth rates are likely to be in wind and solar, these are still only likely to make a modest overall contribution to energy supply (1.6%) by 2020.

Supply shortfall will require imports and investment
The difference between supply and demand for gas could be as much as 40 billion cubic feet per day by 2020. Gas imports will have to double, much of this coming from imported LNG. In Europe alone, LNG demand is expected to go from 3 to 18 billion cubic feet per day by 2020. The IEA estimates that an annual energy investment of €440 billion will be required until 2030, about 40% of which will be for oil and gas exploration, development and production alone. Just that 40% represents more than the current GDP of Norway. Achieving such levels of investment will be an enormous challenge.

Future options in transportation
There are a number of options being developed which offer the potential for improved efficiency and lower emissions versus today’s vehicles. They need to be considered on a well-to-wheels basis to ensure that the entire system is capable of delivering the intended improvements. They are:

• Advanced gasoline engines: ExxonMobil is working with automakers to understand the fundamentals of the combustion process. This will help develop engines with enhanced fuel economy and lower emissions.
• Advanced diesel systems need improvements in tailpipe emissions, especially NOx and this is very challenging. ExxonMobil is bringing its experience in developing new catalytic materials to bear on exhaust aftertreatment systems.
• Hybrids are a significant ‘step out’ technology with efficiency and emissions gains; the challenge here is to improve their competitiveness through cost reductions, particularly for batteries used in energy storage.
• Hydrogen fuel cells are an even larger technology step. Here there is a need to reduce cost for the fuel cell stack, hydrogen production and storage, the fuelling infrastructure, and safe handling. Breakthrough technology is necessary to produce hydrogen on a variety of scales.

All these options require more R & D and many require breakthrough technologies in the longer term. This will require a global effort from the best minds available, if we are to develop technologies that are cost effective, suitable for use on a large scale and effective at addressing the risks of climate change. ExxonMobil is committed to being part of that search.