IHS Long-Term Planning and Energy Scenarios

Transcription

1 IHS ENERGY IHS Long-Term Planning and Energy Scenarios An ongoing planning resource to help organizations create a robust, flexible strategic plan to face inevitable future uncertainty

2 Position Your Organization for Success in an Uncertain Future Uncertainty is the only certainty there is, and knowing how to live with insecurity is the only security John Allen Paulos (American mathematician). In the presence of inevitable global uncertainty, shifts in the economy, politics, security, and energy resources will have important implications for future industry structure and corporate strategy worldwide. For example, a changing landscape can mean differing decisions in terms of investment, regional and value chain entry and exit, commodity marketing and trading as well as response to environmental policy. IHS Long Term Planning and Energy Scenarios This service helps organizations prepare for the future by helping them understand the key forces that will shape their global business environment in the years ahead. At the foundation of the service is the IHS Global Scenarios Framework, a set of three distinct scenarios. Each scenario provides a qualitative narrative and quantitative analysis addressing possible futures for macroeconomic growth and policy, geopolitics, trade, security and technology. One of the scenarios, titled Rivalry, is designated as the IHS planning outlook. This Framework serves as the foundation upon which three energyspecific scenario narratives explore the potential future of energy markets. The service helps you: Develop a clear and resilient long-term strategic outlook as a foundation for making decisions Test specific actions against alternative futures using the alternative scenarios Identify risks and opportunities for strategic advantage Monitor potential changes in global trends and energy markets By incorporating the service into your planning process, you will have better control of your organization s performance in times of change. Access the Collective Insight of IHS Long Term Planning and Energy Scenarios draws from the combined insight and expertise of IHS to provide a broad-based, in-depth understanding of the key issues and challenges facing the global energy industry. This deep expertise is unrivalled in global energy market analysis.

3 We also offer corresponding North American Energy, European Energy and Automotive industry scenarios services built around the same Global Scenarios Framework. The IHS scenarios teams use an interdisciplinary approach featuring contributions from experts across IHS Energy and IHS Economics: IHS Energy Critical knowledge and independent analysis on energy markets, geopolitics, industry trends, plus industry and corporate strategy IHS Maritime The leading source of information and insight for the maritime industry IHS Economics & Country Risk Economic and financial analysis, forecasting and market intelligence for over 200 countries and 170+ industries IHS Aerospace & Defense Global information for the defense, national security, public safety, law enforcement, and transport sectors How Can Your Organization Benefit? Create an economic, energy, and political outlook for your annual planning or budget process. Utilize base case datasets for internal modelling and as benchmarks for their own long-term projections for budgeting or planning purposes. Develop alternative strategies to prepare for possible changes in a company s business environment which can result in large swings in revenues and costs, catastrophic failure, or missed opportunities. These alternatives allow for stress testing or wind tunnelling of principal and alternative strategies. Monitor scenario signposts for early warning indicators about potential shifts to an alternative scenario. News stories and events can be interpreted and connected in a larger context. Who Should Use the Service? Senior Management The Service can help operating executives and senior management think beyond the current assumptions to answer the big questions: What is really driving the business? Where are we most vulnerable? What if our fundamental assumptions are wrong? Where are the investment opportunities? Become more flexible in thinking about the future and more attentive to weak signals that changes are occurring in their business environment in effect, avoiding both wishful thinking and/or blind spots. Avoid the paralysis that can result--in the face of uncertainty and conflicting data--through the availability of a single forecast. This can lead to ill thought out, hasty decisions when significant events occur. Develop a common language for internally discussing the future and allow planning and strategy teams to better understand the sources of disagreements about the future. Helps organizations to better communicate their foresight in changes to their business environment to stakeholders. Strategic Planners, Chief Economists, and Analysts The combination of expansive qualitative thinking and the rigor and feedback of quantitative modelling allows you to: Compare internal forecasts against the three IHS scenarios Use data to plug into internal models to stress test the company view Adopt a framework to test strategic options Fill in gaps in your own outlook Reveal bias in your company strategy

4 What Are The Big Questions Shaping the Future? The IHS Global Framework Scenarios were developed with direct input from IHS clients --representing a broad range of industries and perspectives-who identified their most significant uncertainties about the future of the global economy, politics, security, and energy resources: How will competition for economic and geopolitical power shape energy investment and markets? Technology, policy and societal change: How will these factors interact with each other and shape the energy future? Economy: How would volatile growth impact energy investment and markets? Examining Three Plausible Future Scenarios: At the heart of the Global Scenarios Framework are three distinct future scenarios that explore alternative outcomes to the big questions. In Rivalry, the new IHS planning scenario, we anticipate a world of increasing competition for political and economic power as the world transitions to a more multipolar world with broader distribution of wealth and influence. This increased competition plays out in the energy industry in important ways as growing rivalry among energy sources drives fundamental shifts in the fuels and technologies used in transportation and electric power generation. Vertigo considers a volatile future in which frequent economic and financial tremors cause political and social dislocations and instability. These undermine confidence and perpetuate a perennially risk averse market environment that is focused on short term profit maximization and cost containment, leading to time lags in large capital investment that leads to constant mismatches between demand and supply. While technology innovation is able to continue to move forward, the world is even less able to adjust to its impacts on labor markets and the broader economic landscape, adding further to an atmosphere of instability and imbalance. Autonomy considers a world in which a powerful combination of market and social forces helps to push technology and consumer behavior in ways that transform the global energy system. The world moves from one defined by centralized, traditional sources of energy, to one in which new sources of indigenous energy production are able to meet local energy needs that are changing in fundamental ways.

5 Deliverables Global Framework Scenarios Report - Provides the fundamental global scenario storylines and key drivers behind each scenario narrative. Global Scenarios Snapshot Report - Annual, provides a comprehensive, detailed side-by-side comparison of the key assumptions and logic behind each global scenario with regard to: geopolitical and macroeconomic environment; climate change policy; primary energy; and supply, demand and price outlooks for the full energy value chain (oil, gas, coal, power). Global Energy Scenarios Datasets - Annual, two data sets providing detailed regional and country-level (19 countries) outlooks - one with macroeconomic data (such as GDP, labor productivity and interest rate forecasts) and one with extensive energy sector data including primary energy supply, global emissions levels, supply and demand for oil, natural gas, coal and electrical power - and price forecasts for oil, gas and coal). Global Scenarios Signpost Update - Quarterly, provides a regularly updated assessment of global events that aims to separate key changes and trends from the noise of the 24-hour news cycle, providing clients with an early warning system of impending changes and putting them into context against the Global Scenarios Framework and the current path that world is following. Energy Scenarios Key Data Points Update - Quarterly, includes short-term updates to GDP growth rates for key regions and major countries, as well as prices for crude oil, petroleum products, natural gas, and international steam coal. Global Energy Watch - Semi-annual, strategic report that highlights key areas of research being done by IHS Energy and puts them in the context of longer-term trends and the IHS global scenarios outlooks. Includes interviews with key IHS Energy research leaders. Phone Access to analysts Access to Data Center

6 Content Overview Drawing on our collective insight and capabilities, IHS Long Term Planning and Energy Scenarios provides a uniquely broad and in-depth understanding of the key issues and challenges facing the global business community. The Global Scenarios Framework is the cornerstone of the service. IHS CLIENTS IHS RESEARCH COMMUNITY Global Scenarios Framework Qualitative Analysis (Scope: global, high-level regional, sector, and major country) Geopolitics and Security Environment and Climate Change Policy Social Trends Demographics Macroeconomics Technology Consumer Behavior Energy Data Set (Scope: global, high-level regional, sector, and major country) Macroeconomic Data Economic Growth Exchange Rates Crude Oil Prices Population Energy Scenarios Qualitative Analysis (Scope: global, in-depth regional, sector, and major country) Data Set (Scope: global, in-depth regional, sector, major country, and key benchmark prices) Summary of Global Trends Overview of Global Energy Trends Trends in Energy Supply and Demand (By sector and region) CO 2 Emissions Capital Expenditures and Costs Strategic Implications Population GDP Growth Primary Energy Crude Oil Natural Gas Coal Electric Power Capital and Operating Cost Indices CO2 Prices and Emissions

7 The Energy Scenarios Team Long Term Planning and Energy Scenarios features contributions from experts across IHS. Lead Advisors Daniel Yergin IHS Vice Chairman A highly respected authority on international politics, economics, and energy, Dr. Yergin is a Pulitzer Prize winner and recipient of the United States Energy Award for lifelong achievements in energy and the promotion of international understanding. He is both a world-recognized author and a business leader. Nariman Behravesh IHS Chief Economist Directing the entire IHS economic forecasting process, Dr. Behravesh is responsible for developing the economic outlook and risk analysis for the United States, Europe, Japan, China, and other emerging markets. He oversees the work of over 400 professionals located in North America, Europe, Asia, Latin America, the Middle East, and Africa who cover economic, financial, and political developments in over 200 countries. Nariman Behravesh is also author of the recently published book Spin-Free Economics: A No-Nonsense, Nonpartisan Guide to Today s Global Economic Debates (McGraw-Hill). Leadership James Burkhard Vice-President, Oil Markets and Energy Outlook, IHS Energy Rick Vidal Research, Director, IHS Global Energy Scenarios Service, IHS Energy Advisory Board Members Bhushan Bahree, IHS Energy Mark Griffith, IHS Energy Tiffany Groode, IHS Energy Catherine Robinson, IHS Energy Tate Nurkin, IHS Jane s Michael Stoppard, IHS Energy Zbyszko Tabernacki, IHS Economics Research Leaders Aaron Brady, IHS Energy Andrew Ellis, IHS Energy Bob Ineson, IHS Energy Sara Johnson, IHS Economics Alex Klein, IHS Energy Steven Knell, IHS Energy Rafael McDonald, IHS Energy James Ooi, IHS Energy Lisa Pearl, IHS Energy David Price, IHS Energy Matt Sagers, IHS Energy Candice Scott, IHS Energy Shankari Srinivasan, IHS Energy James Taverner, IHS Energy Jone-Lin Wang, IHS Energy Jamie Webster, IHS Energy Elizabeth Waelbroeck Rocha, IHS Economics Xizhou Zhou, IHS Energy

8 ABOUT IHS ENERGY IHS Energy, a part of IHS (NYSE: IHS), is the industry s authoritative provider of information, analytics, and insight to help clients to understand the interconnected, dynamic forces that shape energy markets and asset performance. Our experts and analytical tools enable clients to continuously improve their strategy and operations across the entire energy value chain, covering oil & gas, coal, power, and renewables More information IHS Long Term Planning and Energy Scenarios Michael Maddox michael.maddox@ihs.com 0000_0000XX