Energy in 2015: Cheap oil changes everything [Recharge]

What does global energy look like after the oil crash? Recharge takes a peek at the future of oil, renewables, and nuclear power.

Stefan Wermuth/Reuters/File
The word "oil" is pictured on an oil bank at a recycling yard in London in this March 2, 2011 file photo. World markets braced for more volatility on December 17, 2014 as tumbling oil prices and a brewing financial crisis in Russia sent investors stampeding for safe havens such as the yen and U.S. Treasuries. REUTERS//Files

The Monitor's Recharge energy digest delivers the big ideas in global energy to your inbox every Saturday. Subscribe for free.

A year ago today, few would have predicted a collapse in oil prices would be the biggest energy story of 2014. Pinpointing next year’s equivalent is just as unlikely. Still, we can at least consider what to watch worldwide in one of the most dynamic, unpredictable, and misunderstood industries. Whatever happens in 2015, these five trends will shape the year ahead in global energy.

Oil change

The oil crash fallout will continue worldwide throughout at least the first half of 2015. US shale production growth will slow, perhaps even pause. OPEC will feel mounting existential threats, and may eventually have to cut production. Strapped for cash, more vulnerable petro states like Nigeria and Venezuela will curtail inefficient, regressive fuel subsidies. The effect on price could go either way.

“On one hand, it could bring down demand,” says Brenda Shaffer, a professor at Georgetown University’s Center for Eurasian, Russian and East European Studies in Washington. “But on the other hand, it might cause domestic instability, which could bring production offline.” Across the globe, nearly $1 trillion in future oil projects are at risk, according to Goldman Sachs.

Politics and power

Just as the US shale boom’s economic realities hit a bump, its political prospects brighten. The rising oil-and-gas superpower’s energy policy gets a whole new look once Republicans take the reins of the US Congress in January. There will be quick action to approve the Keystone XL pipeline, expand LNG exports, peel back the oil export ban, and water down the EPA’s Clean Power Plan. Not all of these efforts will succeed – President Obama still holds veto power – but the predominant tone on Capitol Hill will be a far cry from Democrats’ muted, uneasy support for the domestic oil and gas boom. That means some backsliding on climate progress, and much consternation in Moscow, Riyadh, Caracas, and other petro capitals.


City of (LED) lights

 A mixed-batch preparation likely makes for a mixed-batch result.December’s Lima climate talks made progress over previous negotiations, but failed to surmount many of the longstanding divides that thwart coordinated action toward a global low-carbon economy. The Green Climate Fund met its initial fundraising goal, but remains woefully insignificant relative to what’s needed for sustainable development. It would take a lot for the Paris talks to be anything more than what Lima was – optimism, dragged down by reality, resulting in mixed success. Even if a bold, ambitious accord is reached, whether countries follow through on it is another question entirely.

Nuclear’s next generation

Advanced nuclear technologies are generating a lot of buzz as a young crop of engineers and scientists find new solutions to some of nuclear’s most vexing challenges. Some of the supposed “low-waste,” “meltdown-proof” technologies will prove too good (or too expensive) to be true, but safer iterations of nuclear will look increasingly attractive as the climate challenge becomes more pressing and the limits of energy-diffuse, intermittent renewables become more apparent. Next year isn’t going to see a nuclear construction spree (unless you’re China), but there should be a lot happening in research and development. China will likely lead on that front, too: “[A]s part of installing Generation 3 [nuclear] reactors, I’m sure that China will want to licence the technology and ultimately be able to export it themselves,” notes Stephen O’Sullivan, director of emerging markets energy research for Trusted Sources, a London-based consultancy.

Lightning in a bottle

As wind and solar power generation continues to rise dramatically, the renewables challenge will become less about deployment and more about management. Advanced batteries and grid-level storage offer one solution, and are already quietly getting a lot of attention. The solar industry expects demand for rooftop photovoltaics paired with batteries to reach $1 billion in the US by 2018. Sooner rather than later many residential consumers will find they can meet most, if not all, of their electricity needs without a centralized power system. On the transportation side, Tesla Motors’ gigafactory is bringing advanced battery production to an unprecedented scale. It’s not expected to start production until 2016, but it will give utilities, carmakers, and the energy industry plenty to consider about between now and then.

The Monitor's Recharge energy digest delivers the big ideas in global energy to your inbox every Saturday. Subscribe for free.

You've read  of  free articles. Subscribe to continue.
Real news can be honest, hopeful, credible, constructive.
What is the Monitor difference? Tackling the tough headlines – with humanity. Listening to sources – with respect. Seeing the story that others are missing by reporting what so often gets overlooked: the values that connect us. That’s Monitor reporting – news that changes how you see the world.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to

QR Code to Energy in 2015: Cheap oil changes everything [Recharge]
Read this article in
QR Code to Subscription page
Start your subscription today