CERAWeek 2014 - Wednesday Keynote Address

Ernest Moniz, United States Secretary of Energy, began his keynote address by affirming that the national energy strategy is working both economically and environmentally. Dr. Moniz said that the energy boom has lifted the economy, enhanced energy security, and lowered carbon dioxide emissions. He noted that the Department of Energy (DOE) will continue to support all US fuel sources and advance US technology across the board while pursuing a low-carbon future. He highlighted five key points. The paradigm shift in US hydrocarbon production from scarcity to abundance has implications for policy and infrastructure, he said. He noted that in developed economies, generally demand will not increase as the economy grows, which has many implications and challenges. Pursuing low-carbon technology is critical, he said; costs are falling in many technologies, and it is essential that emerging economies also benefit from this. Dr. Moniz stressed that there is a need for adaptation. The Quadrennial Energy Review this year will seek to address bottlenecks and how to design 21st century energy infrastructure that can withstand the expected increased frequency of extreme weather and cyber threats. In closing, Dr. Moniz noted that there is a need to build the workforce for the future; otherwise, the United States may not be able to enjoy the full share of future opportunities.

During the question and answer session, IHS Vice Chairman Daniel Yergin covered a range of topics with Dr. Moniz. Regarding the hydrocarbon boom, Dr. Moniz confirmed that it has been "extremely important. It has influenced how we address the technology programs at the Department of Energy." He said this has meant more emphasis on natural gas technologies and on the environmental footprint of hydrocarbon production, and he reiterated the twin goal of lower-carbon options while continuing to produce gas and oil, to benefit the economy.

In discussing new technology, Dr. Moniz remarked on the success in bringing first mover technologies onto the market. The DOE wants to continue to support, through loan programs, utility-scale photovoltaics (PV) setups, lower emission fossil fuel technologies (for example carbon capture, advanced combined heat and power, or renewable-thermal hybrids), advanced vehicle loan programs, and manufacturing initiatives. Dr. Moniz highlighted some key benefits of solar PV technology in the United States, including the large solar resource, the flexibility to be both utility scale and distributed, the potential to integrate into consumer products, and the coupling with storage to match loads.

On energy security, Dr. Moniz envisaged a 21st century electricity grid that can accommodate large-scale renewables and builds in intelligent load management. He highlighted the particular risk of cyber threats to energy infrastructure and the close collaboration with industry and the private sector to create awareness of what will be required, build up knowledge of what assets are available, and ensure that suitable legislation is in place in the event of an incident.

The conversation concluded on the subject of China and Africa. Dr. Moniz described the dialogue with China that will cover climate change and pollution, with a view toward the 2015 climate discussions in Paris. At the African energy summit in June they are hoping to bring together senior African politicians and US and African companies to explore options for future investment.

This article was published by S&P Global Commodity Insights and not by S&P Global Ratings, which is a separately managed division of S&P Global.