The UK has maintained its overall fourth place in this year’s Energy Trilemma Index but has lost its AAA balance score to AAB due to a downgrade in its energy equity score. The World Energy Council’s annual ranking of energy and climate policies of 130 countries, registers overall improvements across the three dimensions of the energy trilemma; energy security, energy equity and energy sustainability. The energy equity score measures the accessibility and affordability of energy across the population and has suffered as electricity has become comparatively more expensive.
While the UK has maintained a stable position on its energy security score, it continues to face significant challenges in securing its future energy supply. Consequently, the UK remains on the negative watch list. The report reflects the challenges that countries across the world are facing in balancing the trade-offs of the trilemma goals and dealing with financing the transformation of their energy systems.
Joan MacNaughton, Executive Chair of the World Energy Trilemma study said: “If the UK is to remain ahead of the pack, and regain its ‘triple A’ positioning, the government must give more predictability to investors in the way the electricity market reforms are progressed. More transparency is needed about the future approach to contracts for difference and the levy control framework.”
MacNaughton added: “Our research underlines how priorities vary from country to country - though energy security is key for all. And the report highlights a real issue for the 21st Conference of the Parties due to begin later this month in Paris, namely translating the Intended National Determined Contributions from international objectives into national level actions for energy. The investment required is huge, and driving it to the right places will require a balanced approach if countries are to meet the three goals of the trilemma.”
To support the UNFCCC process the report is being sent to all parties attending COP21 and will form the basis of post 2015 ministerial dialogue, which will take place at the World Energy Congress to be held in October 2016 in Istanbul.
Despite the loss of its ‘triple A’ score, the UK continues to lead most European countries on the energy trilemma.
Two new countries have been added to the negative watch list, which in 2014 included German, Italy, Japan and the UK. The countries are South Africa due to its electricity crisis, and the US where lack of investment in ageing infrastructure and exposure to extreme weather events pose threats to the country’s currently strong energy security performance in the Trilemma Index.
The report’s findings show that the best-performing nations tend to be developed countries with higher shares of energy coming from low- or zero-carbon energy sources supported by well-established energy efficiency programmes.
Every year the Energy Trilemma Index report ranks the energy systems of 130 countries across the world by giving them a score based on how they are balancing the three dimensions of the energy trilemma between energy security (a country’s ability to meet its current and predicted energy demand), energy equity (the accessibility and affordability of energy across the population) and energy sustainability (achievement of supply of renewable or low carbon forms of energy).
Joan MacNaughton went on to say: “The US$48-53 trillion needed for investment in global energy infrastructure is increasingly contingent on a clear climate framework and a global target for emissions. It is clear that the energy industry has embraced the sustainability agenda and is working to help curb greenhouse gas emissions. It has an important role to play in achieving a successful energy transition, but key actions are required by countries if the full potential of the energy sector is to be realised.”
François Austin, Global Energy Practice Leader from the project partner for the Energy Trilemma Index, the global management consultancy firm Oliver Wyman, along with the Global Risk Centre of its parent Marsh & McLennan Companies, said: “This report highlights that governments must set in place clear market frameworks and consistent energy goals to create the conditions to support energy investments and innovation.”
Edited from press release by Angharad Lock
Read the article online at: https://www.hydrocarbonengineering.com/the-environment/09112015/uk-falls-from-aaa-to-aab-in-energy-trilemma-index-1577/