The Future According to Shell

The long-awaited new scenarios from Shell were published yesterday. For 40 years Shell have foregone the typical Western convention of extrapolated forecasts to predict the future impacts of decisions. Instead they have regularly developed a small number of scenarios, where the most unpredictable elements of the future are varied to depict a few possible futures. The last set were in 2008, where two scenarios were created, Scramble and Blueprints – the distinctive difference between the two being that the latter allowed for unilateral, co-ordinated action to curb greenhouse gas emissions. These scenarios were unusual in that for the first time Shell announced a strong preference for one scenario over another*.

This time, Shell have really pushed the boat out and have ordained to attempt to predict the future to the end of the century. They are are great pains to point out that these forecasts are illustrations to help decision making now, not an augur into the unknowable future. The two scenarios they present are named Mountains and Oceans.

Mountains concerns a future where the concentration of power remains with the traditional few. In this world Shell foresee that economic growth will be constrained. They place relatively speedy introduction of Carbon Capture and Storage (CCS) in this scenario, due to a desire to maintain the status quo. This combination of lower growth and introduction of CCS means that the CO2 emissions for the Mountains scenario are relatively low, but still far exceed the trajectory needed for a 2 degree future.

It should be noted that the rate of deployment of CCS in this scenario outstrips the rate of deployment of any large-scale change to the energy industry in the past. This point is not evident from the report, but I am reliably informed that it is the case.

The other scenario is Oceans. Here, there is wider political reform, and the balance of power moves to less traditional places. The turbulence caused by this transition means that the strong policies needed to incentivise and bring in CCS and reduce greenhouse gas emissions are delayed.  In Oceans there is strong economic growth given this market freedom, and the overall emissions of this scenario are higher than in Mountains.

The report highlights that the individual components of each scenario are in some cases interchangeable. It would be possible, they say, for the faster introduction of CCS and other technologies and policies to limit greenhouse gas emissions to occur in Oceans as well as Mountains. They therefore also depict what they call a sensitivity with a more green Oceans outlook – which is still way off the 2 degree trajectory.

They also remark that the scenarios are interconnected; that the seeds of the political upheaval in Oceans lie in the stagnation of Mountains, and vice versa.

Shell - cropped

When discussing the sustainability of these projections, they make two very important points about greenhouse gas emissions. Firstly, they state that it is through leadership and policy making, rather than the markets, that the necessary changes to allow the curbing of emissions to happen can be brought through.

They also state that the projections do not include, as they put it, the climate turbulence that would result from their emissions trajectories. They state that this would severely damage the economy, dramatically lower energy demand and reduce emissions, albeit by a negative route.

They describe a possible future where in the 2020s the effects of climate change are so severe that rich and poor alike demand that the root cause of climate change be addressed, namely to dramatically reduce CO2 emissions within a generation.

Remember, this is Shell talking.

Thoughts below as always.

John Bell,

Ordinary bloke
* Blueprints, by the way, in case you were wondering


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