11.3 Predicting the Future of Global
Energy Governance
Global energy governance reform is about
inclusiveness and looking forward to the future.
Does an ideal form of governance exist or not?
11.3.1 In the Short and Medium Terms,
It Will Become
Increasingly Urgent
to Reform Mainstream
Governance
Organisations
(1) New mechanisms and new institutions are
needed, but it will take time
There is a need to create new mechanisms and
institutions to accomplish new missions in global
energy governance. New mechanisms and new
institutions will be more beneficial to the future
of global energy governance, but this cannot be
accomplished at one stroke. New mechanisms
and new institutions can solve many problems
that existing mechanisms and institutions cannot
solve, but it is not an easy task to create them.
(2) Reform should be pragmatic
There is a consensus that global energy governance requires new mechanisms and new institutions, but this does not mean that new
institutions need to be formed within a short
time. Establishing new institutions costs time and
money and may be impeded by political factors.
It may therefore be more realistic to reform the
existing mechanisms and institutions. To do so, it
is necessary to be fully aware of the difficulties of
reform and devise pragmatic plans.
A mainstream governance institution like the
International Energy Agency should deepen its
reform of inclusiveness, reformulate strategic
objectives and transform itself into a global
energy institution. More emerging economies
should be admitted, and the economic transition
of OPEC countries facilitated. The financial
derivatives market and global energy pricing
should be examined for reform and a more universal alternative explored. Consensus and trust
should be built to avoid differences of interest
after expansion and inclusion.
11.3.2 In the Long Term, Global Energy
Governance Will Extend
Beyond Energy Supply
and Demand
(1) Future global energy governance should
ensure global energy security
A more inclusive and balanced global energy
governance system should look to the future and
strengthen global energy security.
(2) New missions and tasks in global energy
governance will be more diverse, inclusive
and balanced
New missions and tasks to achieve a more
inclusive and balanced global energy governance
system should: improve the governance framework and strengthen international cooperation
and policy alignment; mitigate climate change
and regional pollution; cover financial investment, bulk commodity trading, information and
data sharing; and improve technical progress and
technology transfer in energy.
This can be achieved in the following ways:
(i) consolidate the common security concept of
global energy; (ii) address environmental challenges like climate change and local pollution;
(iii) strengthen multilateral international cooperation mechanisms and share best practice in
energy development and use; (iv) use existing
energy governance mechanisms; (v) build jointly
new international cooperation frameworks,
including those for energy and finance; (vi) extend the existing financial analysis of commodity
markets into the energy sector; (vii) establish a
dialogue on policies that improve stability in key
energy-producing regions; (viii) improve energy
market transparency and the quality of data;
(ix) establish effective strategic reserve mechanisms and cooperation methods; (x) improve
Special Report 5: International Energy Cooperation and Governance
681
Energy Governance
Global energy governance reform is about
inclusiveness and looking forward to the future.
Does an ideal form of governance exist or not?
11.3.1 In the Short and Medium Terms,
It Will Become
Increasingly Urgent
to Reform Mainstream
Governance
Organisations
(1) New mechanisms and new institutions are
needed, but it will take time
There is a need to create new mechanisms and
institutions to accomplish new missions in global
energy governance. New mechanisms and new
institutions will be more beneficial to the future
of global energy governance, but this cannot be
accomplished at one stroke. New mechanisms
and new institutions can solve many problems
that existing mechanisms and institutions cannot
solve, but it is not an easy task to create them.
(2) Reform should be pragmatic
There is a consensus that global energy governance requires new mechanisms and new institutions, but this does not mean that new
institutions need to be formed within a short
time. Establishing new institutions costs time and
money and may be impeded by political factors.
It may therefore be more realistic to reform the
existing mechanisms and institutions. To do so, it
is necessary to be fully aware of the difficulties of
reform and devise pragmatic plans.
A mainstream governance institution like the
International Energy Agency should deepen its
reform of inclusiveness, reformulate strategic
objectives and transform itself into a global
energy institution. More emerging economies
should be admitted, and the economic transition
of OPEC countries facilitated. The financial
derivatives market and global energy pricing
should be examined for reform and a more universal alternative explored. Consensus and trust
should be built to avoid differences of interest
after expansion and inclusion.
11.3.2 In the Long Term, Global Energy
Governance Will Extend
Beyond Energy Supply
and Demand
(1) Future global energy governance should
ensure global energy security
A more inclusive and balanced global energy
governance system should look to the future and
strengthen global energy security.
(2) New missions and tasks in global energy
governance will be more diverse, inclusive
and balanced
New missions and tasks to achieve a more
inclusive and balanced global energy governance
system should: improve the governance framework and strengthen international cooperation
and policy alignment; mitigate climate change
and regional pollution; cover financial investment, bulk commodity trading, information and
data sharing; and improve technical progress and
technology transfer in energy.
This can be achieved in the following ways:
(i) consolidate the common security concept of
global energy; (ii) address environmental challenges like climate change and local pollution;
(iii) strengthen multilateral international cooperation mechanisms and share best practice in
energy development and use; (iv) use existing
energy governance mechanisms; (v) build jointly
new international cooperation frameworks,
including those for energy and finance; (vi) extend the existing financial analysis of commodity
markets into the energy sector; (vii) establish a
dialogue on policies that improve stability in key
energy-producing regions; (viii) improve energy
market transparency and the quality of data;
(ix) establish effective strategic reserve mechanisms and cooperation methods; (x) improve
Special Report 5: International Energy Cooperation and Governance
681