Fatih Birol, chief economist of the International Energy Agency (IEA), presented the publication which contains the organisation’s global energy industry forecast in Budapest on 5 December 2013. At the Central European presentation of the volume called World Energy Outlook 2013 hosted by the Ministry of National Development, Secretary of State for Energy Affairs Pál Kovács pointed out that the IEA’s forecasts play a key role in domestic energy policy.

The IEA takes the view that the time has come to re-evaluate basic knowledge, which we used to believe was unchangeable, about the energy sector, Fatih Birol said as an introduction. We are witnessing countries as they are exchanging their roles: importers are becoming exporters in search of the main sources of a growing demand. And the new opinion shapers of energy supply tend to alter the ideas we have entertained so far about the distribution of sources, the international organisation’s chief economist warned.

The analysis suggests that the current long period of high oil prices is unprecedented in the history of the energy market. The forecasts also anticipate major differences between the regional prices of natural gas and electric power on a continuous basis. The world will increase its energy demand by one third until 2035. Two thirds of the surplus will be generated in China, India and South East Asia, and a mere 4 percent will come from the OECD countries. Within more than twenty years, the demand for electric power will rise by nearly 1.5 times. Current trends also forecast an increase in fuel prices and greenhouse gas emissions. The latter will highly affect the European Union’s competitiveness.

In his presentation, Pál Kovács said it was a major step in terms of the Hungarian Government’s cooperation with the IEA that the Agency’s publication was only presented in Hungary within Central Europe as part of a special event. “This high privilege is due to the improvements that we made in this area after the change of Government in 2010, by adopting a well-grounded energy policy which gives appropriate responses to international processes and can flexibly adapt to changes”, the Secretary of State said.

A key to Europe’s competitiveness is the efficiency of regional market connections. By connecting next day electricity markets, Hungary already proved that it is possible to successfully reduce the differences between regional prices. The Visegrád Four will continue to implement the region’s natural gas market integration during the Hungarian Presidency by promoting infrastructure development, building North-South connections and harmonising regulations.

Pál Kovács spoke about the need to adopt a technology-neutral approach to developing an energy policy built on the reduction of steadily rising global carbon dioxide emissions, where nuclear energy should be a component with the same conditions as renewable energies. He stressed that both technologies are proper ways to reduce energy import, contribute to improving the environment’s quality and encourage economic growth by means of domestic job creation.

The presentation was also attended by István Mikola, Ambassador to Hungary’s Permanent Representative Office to the OECD. At the event, István Zsoldos, chief economist of MOL Hungarian Oil and Gas Company Plc., and György Harmati, Strategic Director of MVM Hungarian Electricity Ltd., spelt out some reflections from the industry.

(Ministry of National Development)