Energy Security

Energy security is vital to the functioning of a country, particularly for its economy and the wellbeing of its people
Any country that is self-sufficient in energy resources will be secure in the sense that it will have the energy needed for its development
For less fortunate countries which rely on imported supplies, energy security depends on whether there is uninterrupted availability of energy at affordable prices
Risks
1. Physical - for example exhaustion of reserves or disruption of supply lines by natural hazards such as earthquakes
2. Environmental - for example protests about environmental damage caused by exploitation of energy resources
3. Economic - for example sudden rises in the cost of energy, or exhaustion of domestic supplies forcing increased imports of higher-priced energy
4. Geopolitical - for example political instability in energy producing regions, disputes or conflict over sovereignty of energy resources, or disputes over energy transmission by pipelines or cables across countries
5. Energy security has risen to the top of the agenda of many governments, international organisations and businesses
6. The sustained growth in demand for energy has led to serious concerns over the long-term availability of reliable and affordable supplies
7. Increasingly governments, industries and people are taking a more protectionist view of their own sources of energy
Measuring energy security
1. Energy security is complex, but so great is concern about it that attempts have been made to measure it
2. The energy security index (ESI) is an attempt to measure energy security
3. ESI assesses the extent to which a country may look forward to a reliable and affordable supply of energy
4. Availability - The amount and longevity of each country's domestic oil and gas supplies and its level of reliance on imported oil, gas and electricity
5. Diversity - The range of energy sources used in meeting each country's energy demand
6. Intensity - The degree to which the economy of each country is dependent on oil and gas
Levels of risk
1. ESI values range from 0 to 10
  1. Between these values four categories or degrees of risk are recognised
    1. Extreme risk - ESI values less than 2.5. Most countries in this category are in Northern Africa and Northern South America. It also includes South Korea a NIC
    2. High risk - ESI values 2.5 to 5.0. Such countries are scattered across the globe and include a number of developed countries, most notably the USA and Japan
    3. Medium risk - ESI values 5.0 to 7.5. A widespread category in Europe, South and Southeast Asia and Australia
    4. Low risk - ESI values greater than 7.5. Qualifying countries include Canada, Russia, Norway and the more stable middle eastern states - all are producers and exporters of oil and gas
Characteristics of risk
1. Heavy importers of oil and gas show high levels of risk
2. Countries with substantial reserves show low levels of risk, regardless of their own levels of consumption
3. Medium-sized development countries show low levels of risk, regardless of their own levels of consumption
4. The level of risk in the large emerging economies is similar to that in most advanced countries
5. The relatively low level of risk in many African countries reflects their low consumption or the existence of untapped resources
6. The USA has a higher risk than might be expected because its huge consumption and imports overshadow its significant oil and gas resources and the fact that it uses a diverse range on energy source
UK energy security
1. In the 1980s and 1990s gas and oil from the North Sea meant that the UK was virtually self-sufficient in energy
2. Now North Sea production has started to decline and the UK became a net importer of gas in 2004
3. By 2020 gas imports could account for 80-90% of total demand
4. Coal, for example, currently accounts for about 15% of the UK's primary energy supply and most of it is imported
5. Coal is widely available from reliable sources at competitive prices
6. The energy security of the UK has become a major political issue
7. The UK still has workable reserves of coal
  1. It could also offset energy security concerns by increasing the use of coal to generate electricity
    1. However, such a change would increase the UK's carbon emissions, which it has committed to reduce
8. The UK relies not just on coal but also on a mixture of oil, gas and other forms of power
9. In general terms, the UK needs to minimise risks such as disrupted supplies and escalating prices

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	Created by Jodie Goodacre over 10 years ago