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WEC initiative to mobilise energy investments

Hydrocarbon Engineering,

The World Energy Council (WEC) has launched a new initiative to help mobilise investments into the energy sector.

The WEC project, Financing Resilient Energy Infrastructure, will seek to understand how the energy and finance sectors can work together and with other sectors to better understand risk and uncertainty in energy infrastructure and thereby unlock the capital needed to accelerate the transition to a resilient global energy economy.

Christoph Frei, Secretary General of the World Energy Council, commented: “New emerging risks are posing ever greater threats to the energy sector. Unless we have solid understanding of the nature of these risks and appropriately adapt energy financing mechanisms and infrastructure design, we may well see an investment impasse, which could threaten to cripple global energy systems. Our new initiative will develop the necessary understanding as catalyst for continuing to mobilise the massive capital flows required to expand, replace and transition our energy infrastructure.”

The project will seek to find out how much additional energy infrastructure investment would be needed to address the emerging technical and physical risks. These risks include water stress and the energy-water-food nexus; extreme weather events; cyber threats; social activism; and technical efficacy, or how the development of non-energy technologies impacts energy generation.

It will identify and characterise the nature, frequency and severity of these risks, and share and promote the incorporation of these risks into energy infrastructure design and investment decisions. The first phase of the study will be released in the first half of 2016, ahead of the World Energy Congress.

The findings will be used by the energy and finance industry to inform future investment decisions.

The WEC will carry out the project with Swiss Re and Marsh & McLennan Companies, Inc.

Juerg Trueb, Head of Environmental and Commodity Markets at Swiss Re Corporate Solutions, commented: “The investment needs in energy infrastructure in the upcoming decades are tremendous. This project will help to better understand existing and emerging risks as well as risk management approaches available to investors.”

Alex Wittenberg, Executive Director, Marsh & McLennan Companies’ Global Risk Center, added: “As the infrastructure for energy supply and demand continues to develop around the world, it will be critical to strengthen its resilience in order to withstand and mitigate risks so that supply to support economic growth can be ensured. This project will develop insights necessary to build a future-proof energy infrastructure.”

Adapted from press release by Katie Woodward

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