Davos 2024: Transforming Energy Demand

Tania Bryer: Good morning, everybody and welcome to this crucial discussion here at the World Economic Forum 2024 on transforming energy demand. My name is Tanya Bryer and I'm an anchor from CNBC and I'm thrilled to moderate this session this morning.

So you've seen some statistics there on the video. By 2050, estimates indicate that the global economy will have doubled in size and will be serving a population of over 10 billion people. In this context, improving energy efficiency is critical to delivering an affordable, secure and climate-aligned future.

Research in the recent white paper, "Transforming Energy Demand," published by the World Economic Forum, shows that there are many tangible actions that all businesses can take today to act on energy demand. So what can companies and governments do to enable economic growth through transforming energy demand?

Just before we start, I'd just like a few housekeeping points. I'd like to remind you that the session has been live-streamed around the world. We have audience members from all over joining us online and of course, for you in the room as well, please remember to use the hashtag #WEF24 when sharing any updates on your social media channels and there will be time later on in the session for your questions.

It's now time to introduce my very distinguished panel. Please welcome right next to me here, Dr Fatih Birol, executive director of the International Energy Agency. Welcome Fatih. Peter Herweck, chief executive officer, Schneider Electric, welcome Peter. Dr. Ilham Kadri, chief executive officer and chairman of the executive committee, Syensqo. Dr Anish Shah, group chief executive officer and managing director, Mahindra Group. Last but not least, bringing up the rear Bobby Morritz global chair, PwC, United Kingdom.

So, Dr Birol, what can companies and governments do to enable economic growth? We've just seen at COP28 of course, the pledge by over 120 countries to double the global average annual rate of energy efficiency improvements. Historically as we were talking before, we've seen a focus on supply. But now it's crucial to talk about demand Why?

Fatih Birol: So, first of all, it's a great day. The reason is in Davos, for me I think this is the 14th year in a row, that the energy efficiency takes such a prominent role the opening day, we have a session on energy efficiency. It is really a dream for the people like me that there is a growing attention to energy efficiency, finally. So, for us, for many of us, energy efficiency is very important because there are so strong drivers.

Very simple, first, if we want to protect the consumers from high energy bill, energy efficiency is a must – you use less energy. Second, it is good for your energy security for the governments, for the nations, you have more secure energy, if you use less energy, import less energy charge. Third, for the industry, for their competitiveness, it's a key issue. If the company wants to be competitive, vis-a-vis the others, you have to reduce the cost of energy and energy efficiency is critical. And fourth is the environmental footprint – climate change.

For all these reasons, normally, you would think, as Americans would say, it's a no-brainer. But we have not seen enough policy attention and energy efficiency. So, as such, today's a very good day. Now you mentioned the COP28. You are right. It is one of the important outcomes of COP28 and we as the International Energy Agency together working with the COP28 presidency, made five conditions to consider that the COP28 will be a successful one and one of them was doubling the rate of energy efficiency improvement together with renewable tripling and others.

So, more than 120 countries use it as a separate document but at the end of the final document, 200 countries signed off: we are committing ourselves, we are making this pledge to double the rate of energy efficiency. This is great news. Of course, we have to see what will come out. The other good news is that we look at the last two years after we had the global energy crisis after 24 February 2021. In the last two years, 75% of the countries around the world strengthen or put new energy efficiency standards, this is excellent news.

It is driven by, I think, the governments got it at the end, many governments – if I want to secure my energy system, I have to use this energy plus high energy prices might've been another driver. So what do we need to do now?

So, first of all, I am a big fan of standards; we have standards of the equipment we use at home for industry, the motors. For the cars and others, there should be standards, first of all, set and then monitored and implemented. Is the first thing. Second, electrification of our energy system. It is going well for the time being and I'm hoping it will go better we are seeing in the transportation sector. There is a very strong move.

We have a colleague from the car manufacturing industry here. Three years ago, one out of 25 cars sold in the world was electric cars and now it is one out of five cars sold is electric. It is going to grow very strongly. So the heating at home, it is going more and more the heat pumps leaving aside fossil fuel heaters. And there are many other ways. This is the second one.

Standards, electrification and the third one is the most important one maybe – investments. We need to triple the investment in the energy efficiency measures, which in most cases, pay back in two or three years of time. It's a very lucrative business but the governments need to give incentives, especially in low and middle-income groups, to make the first investment to buy a heat pump or to have an electric car or others. So all in all, I believe there is a new era starting for the acceleration of energy efficiency around the world.

We all understand that is a good thing to do, regardless of climate, regardless of something else, just for our pockets, for our energy security and also to remain competitive. The companies, to finish with the companies, the companies who do not put enough emphasis on energy efficiency will be less competitive vis-a-vis others; it's a real fact now.

Tania Bryer: How fast can these actions be implemented do you think Peter, the ones that he's talking about?

Peter Herweck: Well, you know, I think the time is now to do it and technology today is available to take out 70% of the CO2 emissions with today's technology. Let's put this a little bit into perspective. Eighty percent of the carbon generation is related to energy, 30% in buildings, 30% in infrastructure and industry and 30% in transportation and then a little bit of the rest.

Now, if we look at buildings, for example, since it's a third of the block, to put it into perspective, you said earlier until 2050, we have 10 billion people on the planet. That's 2 billion more than we have today. Plus there are a billion people that don't have access to energy today.

We want to bring them also into into the fold of having access to energy because it's the passport to a good life. So, 3 billion people that will be put into energy at that point in time. And that also need housing.

Just to give you an idea we need to build until 2050, what China has built and what Europe has built just to house these people. Now, all the infrastructure and buildings that are there in Europe, they're going to be there and 2050. We're not going to rip everything down and build it new, so we need to renew what's there and we need to do it at speed.

Now, the payback period and you know many of us are business people, so we're worried about the payback period. The payback period for renewing your building or your facility can be two to three years. And I want to go all the way down to an example so people can see that it's actually working.

We've been working with a Japanese company in the pharmaceutical space, Takeda, and their facilities in Singapore. We've put systems in to understand how the energy is used, we help them to reduce it to be more efficient. Then of course, we added also together some solar rooftop to put a little bit of what's called a microgrid into the building so they can manage their energy.

Today, they're net negative. They're actually furnishing 15% of the energy into the grid, renewable energy into the grid. Of course you can say, well, they have they have the luxury of having a big rooftop and a lot of solar. Yeah, that's one solution. But we can talk also about the 600-year-old hotel that we've done in France with clients and the payback period in two to three years. So the action is now we need to have governments understand and also you know, if there is a good policy to subsidize, let's do it.

Tania Bryer: When you're discussing transforming energy demand, Dr Kadri, with policymakers, what area do you want help?

Ilham Kadri: So, talking about this energy, I think I want to come back to what was said before talking about the policymakers. There are three pillars which are really good in the report.

Save energy, don't waste – it's a no-brainer to take the American saying – second is energy efficiency and three is value chain partnership, we cannot do it alone. And I represent here the chemical industry right, so, I do whatever Peter says so on our sites around the world, I put solar where our site is blessed with solar etc.

And indeed there is efficiency but in the hard-to-abate we have a bigger problem right in how to decarbonize our industry. So, we are doing all of this – we're working on process efficiency. I think the energy crisis in Europe was a wake-up call and we didn't waste this good crisis. We start living with less gas in Europe. We started reimagining our energy inputs first.

Go into biomass looking at other ways of producing steam. The excess of energy, like you said, Peter, we as an industrial leader and player and we're not an energy maker, we're selling energy into the grid and into the communities the excess energy and this is great, while improving the efficiency of our steam operations.

Up to 5% reduction in every side just steam. So those are great things and digitalization. AI is making the invisible visible in an old industry like the chemical industry, which is great. And that's what we like as leaders, is to see the hidden parts of the iceberg. To cut the waste and if we use those byproducts, etc. it's not a waste anymore.

So once I tell the policymakers, we need energy affordable at scale. Because I'm not an energy maker when I'm ready to decarbonize my site. I need it available 24/7, 365 days a year at the right price in Europe and we are, here in Europe, is too expensive system. And we know it's not competitive as compared to other regions in the world.

I tell them to rethink regulation or a lot of regulation. It needs to be harmonized, simplified. Specifically in the EU, we need unity, not uniformity always but we need unity. And it's still too long to get a permit. Permitting is insane two to three years to get just the permits, etc. So we need that.

Second, we need reinforced reinforcement of IP and protection. Specifically for the good guys who are doing the right thing. We need regulatory recognition. Where is it? From the regulatory point of view but also link the dots with the investments community to promote the people who are doing the right thing.

And the last one, it's scale-up innovation. I think Peter said it very well. Innovations are there. We are scientists, we are bringing those innovations and but we don't need anecdotes we need to sit on critical mass mainstream. And that's why we need regulatory environments, you know, friendly to business to help us to scale them up to be able to go faster in our decarbonization efforts and therefore, to make it cheaper and more affordable for many other players.

And value chain is important. Small and medium-sized companies are today suffering from those green revolutions, which are not easy for them to embark on.

Tania Bryer: So, cheaper and making it more affordable key issues. Dr Shah, what initial financial sacrifices do companies would have to make to implement these energy demand saving actions?

Anish Shah: I think it's a myth that you need financial sacrifices for this. And let me start with a dream. What if the world requires less than half the amount of energy needs today to operate in exactly the same manner that it operates today. This is possible.

I represent the Mahindra Group. We operate in 20 industries, from automotive, farm, to real estate, solar, hospitality and so on. But let me talk about two of our industries that are the most users of energy – auto and farm equipment or tractors. We began our journey in 2008. And we've been measuring the amount of energy required to produce one automobile or an equivalent unit of automobile which is how many autos can be produced in 1,000 minutes. And similarly the amount of energy required for one unit of tractors.

We have a 95% energy productivity in this time period in auto and 87% in farm. What that means is we have effectively reduced energy use almost by half. So this is possible. The question is how and I'd say there are four key areas that we focused on.

One is the simplest one, which is energy-efficient equipment. That's a no-brainer that requires some investment, yes. The second is process changes. Technology today affords a number of different process changes from the simplest things of if you don't need a machine, it turns off automatically to heat transfers to a number of other areas.

The third is supply chain collaboration. Example here is a certain type of paint allows us to use less energy in the paint process. And fourth is a product and design of products. And here, I'll take an example on buildings.

We've just launched two residential complexes which are net zero and that's based on the design of the buildings, on how they position how they use the sunlight on putting both wind and solar in the buildings taking energy off the grid a number of other initiatives where these are net zero residential communities that we've set up.

So these are the various actions that can be put together. And what we've seen is that through multiple projects, the payback period is typically 12 to 18 months. So there are no financial sacrifices in doing that. There is no silver bullet, so I will not sit here and say that here are three things you can do and this happens overnight.

Our team has literally done 3,600 projects in the last 16 years. We are at a run rate of 300 projects a year and each project has obviously a small impact. But collectively, when you put them together, you see the impact that's far greater. And the question then is how do we scale? And this is where I would give a lot of credit to the World Economic Forum in terms of what it's done over the years.

The first was coalition discussions like this where we can exchange ideas. One of the initiatives we have is partnering with Johnson Controls now which has a lot of technology for buildings again, and taking that to everyone in India to say here's technology that you can use without being commercial on it and just sharing that best practice in terms of what we've learned. So this is again, the power of discussions we have in terms of how do we translate that to action on the ground.

Tania Bryer: Well, how do we translate that to action on the ground? How do you align the public and private sector?

Robert E. Moritz: So the good news of going last and the bad news is going last is you may run out of time but you could actually pick up a couple of points along the way and pivot and I do want to bring a couple of examples to life, what my fellow speakers have talked about.

So, great news that we're having this conversation to raise awareness. But let's go a little deeper on awareness and our own PwC CEO survey that we launched last night when we talk about the issue of climate and emissions, 75% of 4,000 CEOs around the world saying they're actually taking action in the energy efficiency space. And the reality is if we are taking those actions, as you just said, we wouldn't be having these conversations that we took the right actions at scale and that's the real challenge right now.

Number two, just to reinforce, if you read the WEF study – and credit to the WEF for pulling this together – what we wanted to do is get awareness on the singularity of the issue. And if you go back to some of the major messages coming out of a COP meeting we had "let's make sure we reduce emissions and think through what I'll call the carbon-intensive phase out" in terms of what you need to do for energy, you need to increase renewables and you needed to deal with the efficiency points on energy. And we're trying to singularly get some more focus on that last point of the three because the other two have gotten a lot of time and attention recently.

Now, let's take that back to a business perspective for a moment. In most of the organizations that might be in the room here today, you probably have a centralized point of view of where to connect with and ultimately contract to get the supply of energy. You have a decentralized view of how to think about the use and consumption of energy. And that's the major point here.

So, when we talk about awareness, we're looking to do two things: create the focal point to say we got to focus on consumption now and second, awareness of the many different choices on the menu of which you compute, many of them small little ones, that will move the ball forward and we're looking for incremental savings at scale.

So as you go back to what the WEF has done with the IBC, and Peter talked about it previously, is what can we do now to a) create the awareness, b) can we share more best practices and give people more of a menu of choices to make some decisions on? And these decisions go in the area of savings, which is quick, easy, a decision just needs to be made. It's an operating expenditure.

There's other decisions that are more around efficiency that may be CapEX and you do have to make some investments but as Peter said, the ROI is almost immediate. And third is how do we actually get the partnerships together and this goes now to the partnership point: we need partnerships across the sectors and the commercial side. Because if we come together to share best practice and maybe take action, you actually get an amplifying effect.

In fact, we think that's the biggest amplifying effect when you look at what you can do on the saving side versus the efficiency side. And the second piece of that partnership is with governments. The next phase of work has to be how can we work with governments to say what are the right policy changes to be made to accelerate the curve?

We've been talking about some of the policy changes on increasing renewables. Now, what do we do to actually have the right dialogue on policy changes to enhance the efficiency points and that's the next phase that we've got to create awareness for and get some of the G7 and G20 countries really focused on those points.

Tania Bryer: How do you get that collaboration? How do you encourage the public private sector governments to go in the same direction?

Robert E. Moritz: Look, the reality is you've got a force for change and a force for good that rests in your business committee because there's a commercial rationale behind this.

Anish Shah: It makes it makes economic sense to deal with you know, this is what Bob said and one of the points we haven't touched on is the creating visibility. So digitize across your facilities. You've done it in Mahindra, we've worked with other clients for example to only understand in all the campuses, all the buildings, all the factories, all you know data centres, whatever you have, create visibility at the top floor.

How much energy am I using? What type of energy am I using? How much CO2 am I generating and then task somebody to go deep and get it done.

Robert E. Moritz: The more important thing though, if I can, just to pick up on Peter's point, at the COP meeting, we hosted a session – a small group, much more than this – where you have a couple of policymakers and a number of business people in the room. And many of them said, we're on this. And we're not.

Let's be honest, we're not at the level of scale and urgency that's needed. And for that matter, for the level of opportunity that exists in the corporates because, to Peter's point, there's bottom-line potential here as well.

Tania Bryer: Why did they feel they want it though Bob?

Robert E. Moritz: I know, I'm not aware of all the different choices I have. I'm aware of what I know and what I'm actioning today. There's lots of other things as Peter said, that we can actually be doing more of so if we get that competitive, sharing together, sharing across the business community and sharing across governments. There's more awareness at a granular level. And now I know what AI is the world of possibilities, I can now start to take those actions.

Fatih Birol: So should I say something?

Tania Bryer: Yes, of course.

Fatih Birol: I believe energy efficiency, everybody, when you go to a meeting, energy meeting, I don't see anybody who would disagree that energy efficiency is a good thing. Everybody says it's a good thing. But it is not moving very fast. What is the reason?

First of all, I don't think that the energy efficiency will improve by saying the people let's improve the energy efficiency in the television making the advertisements only in the schools. It can help a bit. But it's not the main story. And the companies wouldn't take the energy efficiency measures to make the investments.

Only two or the main thing I should say, to make a public service they would only do most of them at least, if they have a commercial interest and that to be very frank on that.

So I, with all due respect to my colleagues here, there should be some mechanisms to make sure that the companies if they put the energy efficiency measures in place, they will have a competitive edge vis-a-vis others. This is number one.

Number two, also for the consumers in the households and others, they will save energy, just for the sake of saving energy. There should be, I maybe see too, the government point of view but there should be standards. Without standards and norms this would not work. I give you an example.

Today, the biggest challenge we are facing in the world in terms of the climate change, most of the emissions come frompower generation and then we'll get to Asia. What is the number one, by far, number one driver of power demand? It is, by far, it is air conditioners and they will grow very strongly. When you get the Asian countries, developing Asian countries, the amount of energy you need for an air conditioner to provide the same comfort compared to Japan, you need three times more electricity because they are inefficient.

If they hit the standards that Japan, the Asian developing countries, for example, they would need less electricity and we would need to build less power plants and therefore there'll be less problem of climate change and others and also we keep the money in the pocket. So, therefore, two things: there should be a commercial interest and the second, there should be standards set by the government and they should be reinforced and implemented.

Tania Bryer: Fatih, what if the governments change and what if you have governments let's say that change that are not supportive of these kinds of policies?

Fatih Birol: I think we have to make the governments understand that a) if they do that it is good for their budget. They will save money. Good for the security, energy security, national security and good for their carbon footprint.

Some governments don't get it. Some governments get it but energy efficiency is a complicated business. You have to coordinate it among the different ministries. It is not on the energy ministry, finance ministry, the industry ministry, you have to have a coordination and you have to get the coordination done. It is the reason why we are working with many governments around the world – we brought about 60 governments last year in Paris in Versailles to give them the guidance there and it is a reason many governments are picking up and putting new standards and norms and they are following it because they understood that it is not for the sake of the world for dreams and utopia and everything.

It is for real life. It's better for their budget. It will be better for their energy security and better for their carbon footprint. So this is the issue and I see that the change in the last two years. As I mentioned, 75% of the countries put new energy efficiency standards or strengthen them is a result of two things. We and others pushing it very strongly and the second, high energy prices because there is a driver there too.

Tania Bryer: Of course, Dr Kadri.

Ilham Kadri: I think there is a big elephant in the room called competitiveness. And with all of this I think we have great examples – industrial examples. We are ready as innovators to provide solutions to decarbonization. But competitiveness is important. And when you have energy prices, which are four times higher in Europe than in other places, in the world, there are many people in the industry value chain, chemical industry value chain I represent here, who are suffering.

And when we say energy savings, let's put it right. We will not be winning by decreasing the carbon footprints and saving energy by decreasing the industrial output. This is called industrial suicide. We need to do more with less when we will continually industrially producing – creating jobs, creating environments which is business friendly. So I think that's the big question for me.

Therefore, we need to create also demand for those new innovations, right. And the demand comes, Syensco is a leading actor in batteries. But without enough charging stations, the end user, you are not gonna buy an EV or hybrid car, right? So we need those charging stations.

We need an infrastructure to promote our key mobility solutions and accelerate them to cannibalize our own business and allow the world to turn more greener. But with affordability in mind. So I think that's for me important – keep competitiveness in mind.

All the regions in the world are not equal. Europe is not a fossil fuel region right, and it will never be. And in our, of course, we are cleaning our home, looking at electrifying our processes as much as we can, moving from coal to gas by the way, which is good. And whenever we can move to biomass, we do it as well. But we need here policymakers and authorities to support us with the ecosystem to make it plug and play, because the hard-to-abate, heavy industry. This is where we can have the highest impact.

Tania Bryer: Dr Shah, can I ask you about emerging markets and developing economies facing the largest increases in energy demand – can these economies follow the same pace of change as developed countries do you think?

Anish Shah: I think the developing countries can actually create a better set of outcomes and India is leading that today.

Even if you look at renewable energy, India's putting in 500 gigawatts of renewable energy by 2030. The beauty there is the cost of solar energy in India is far lower than traditional energy. And we run a solar business and we're moving all our plants now with captive solar energy. We can set up a capital plant in one part of the country and have it transmit over the grid wherever you want. And it's a 30 to 40% saving in energy so it's a no-brainer.

Coming back to what he said earlier for companies to come in and do that. So I think emerging countries are going to in some ways, show the way and rewrite the rules in terms of how energy can be used. If we go back to the earlier discussion. This is not in my view our regulatory, I do agree that standards will help and especially air conditioning is a great example. But this is a very different problem than what we see in the rest of energy issues.

The reason for that is, one, everyone agrees that we'd love to spend less energy to produce the same set of things. There is no debate on that and this is what's competitive, what's commercial for us, etc. The question is how and here I go back to my earlier point, which is there is no easy answer.

So it's not for CEOs to come in and say I'm going to focus on this one project, make this project work and that's my solution. It's about getting the entire organization committed to it because that's where the results are going to come and unless that culture changes driven across the organization. Go back to what Bob was saying about best practice sharing and show them here are things that you can do. That's where the difficulty comes in.

There isn't something I can show in the next three months and I've got an answer on this: I solved this problem. It's a long-term problem we have to solve.

Fatih Birol: Yeah. You made in India a very good thing. LED lighting. This is a huge program, LED lighting. And we are taking it as a best practice. And we went to Indonesia because in the energy efficiency, it is unlike the other parts of the energy sector, which is much easier to share the best practices because they are not very different from each other, which is it can be lighting, it can be the air conditioners, it can be the IT, cars, the standards for the cars and other.

So therefore, what India has done and the lighting is an excellent example to be shared, is a best practice with the rest of the world.

And it doesn't need to come only from the developed countries to developing countries. It can go from developing countries to another developing country, if a successful one. In my view, it's a success – LED and I think we have achieved that.

Anish Shah: That's exactly right and I would just add to it, which is, as you talked about what can governments do? The government in India is proactively pushing climate change in a very big way. I represent FICCI, which is one of India's oldest and largest industry associations and in discussions with the government, they're actually pushing industry to actually do a lot more, a lot faster.

Tania Bryer: Peter, I know you wanted to come in.

Peter Herweck: Yes, I wanted to come back to the white paper that we've done together because we've deliberately picked quite a few examples. And I think it's about these examples.

It's a very complex environment. Whether, you know, air conditioning and building, building management system, you know, efficient pumps that ought to be used in buildings and so forth or in the manufacturing environment is again different, whether you have hard-to-abate and you don't have enough electricity to substitute a steam process with electricity when you go into light manufacturing, it's a different story.

You go into a data centre, these, to a large extent, carbon neutral today and there is some work to be done, even more so we picked these examples in the white paper and I invite everybody who has the power to make change to read some of those. And we will come out with lighthouse examples we can share. And it's not about who has done what, but what's possible.

Tania Bryer: Practical examples. I would now like to open up questions. Yes sir and if I can ask you to keep your question short and keep it as a question, not a commentary, and introduce yourself as well. Thank you so much sir, you were first.

Kai Mykkänen: Thank you indeed. I'm Kai Mykkänen, a minister of energy and environment, Finland, which is a small about energy-incentive country. And we had last year actually already 94% fossil-free electricity and we've decreased emissions by almost 90% since 2010. The problem is seasonality.

We had last year 467 hours of negative electricity price, so more than 19 days in a row if you put it. But on the other hand, two weeks ago, we had a day where we were having two euros per hour for almost a whole day.

And my question for you is how you see this balancing challenge that is the result or the ask for more from the demand side – do we see potential for, for example, buildings or electric vehicles taking the largest part of the demand response and balancing challenge.

Or does this mean that we actually need clean baseload as nuclear we need flexible weather, independent energy, not only wind and solar because this is what we are now considering heavily and of course, we try to solve with all these angles but you can now give your advice.

Tania Bryer: Thank you so much. Dr Birol, I know you want to answer.

Fatih Birol: What you can do is in Finland to other countries like the three areas, one demand start response and this is more the making sure that in the difficult times, the efficiency measures come in place.

This can be as a result of again, standard norms or a different type of pricing of electricity. And the second one is, in addition to the renewables, it is important to have the hydropower or nuclear power in the mix. And I believe with the increasing share of renewables and in the countries that is a seasonality issue, nuclear power can play an important role and it's the reason why we are seeing a lot of nuclear power is making a strong comeback.

Tania Bryer: Absolutely.

Peter Herweck: Of course, I think the investment needs to go largely all into the into the grid to understand who are the main consumers and then as you walk down in the grid you you come to be at campuses or you come to large industrials or you come to users that can actually fluctuate the energy that they need.

A good example is for example, so data centres that do AI modelling because they don't need exactly the same power over time, they can go up and down. But those that require contracts between the generation unit and the user and the demand response can be fully digitized.

So you know you have one of the most complex problems at the end of the day but it's good that we have countries that are so far in the renewable space now. How much can we shave off the peaks and fill the troughs? That's the next challenge to have and I think digitization of the grid into the micro grid into the big users will help to to do it.

Robert E. Moritz: One point that we can't forget is today we are so focused on energy consumption, the dialogue that we're having on what are called the traditional energy sources, we have to be equally as focused on reduction and efficiency and savings of the renewable energy sources to avoid again a repeat of the same problem.

Because right now, we still don't have enough supply around the world on the renewable side to deal with this issue. So we actually have to be smart on both. But I don't want to have us focus just on one side or the other. It's a broader, energy-efficient point that we should be talking about.

Tania Bryer: Let's just take another question. We have time for one more. We have another question from our audience. Yes. Thank you. If you could introduce yourself. Thank you.

İdris Küpeli: İdris Küpeli from Turkey. Aydem Enerji Group's CEO. When the renewable investments certainly are CapEx intensive, front-loaded investments that require significant financing and financing certainly, during last few years has been both expensive and inaccessible to many countries. To have the infrastructure.

To make them more efficient is one thing that requires, sometimes, little or no money and several hundreds of projects to make it more efficient. It looks good for the leaders but to actually undertake an investment of you know, the billions of dollars, you need the counterparties that actually are going to take the risk of the country that you are going to build the renewables or the nuclear, so for then for Turkey, it has been really challenging in the during last four or five years.

But at the end, as Mr. Birol commonly says we live in the same environment to solve one country's environmental issue and to make it better, does not help so long as you don't actually distribute the same way to the entire globe.

So how can the emerging market countries have access to finance at a reasonable cost because it's good for everyone? And who can actually undertake this and one of them that I know but I think it's not 10 is not enough and given the cost of financing for the banks, it's not lucrative enough how can we solve the issue for the emerging countries to do the especially the renewable investments?

Tania Bryer: Thank you for your question. Dr Shah?

Anish Shah: So let me share our story in renewables. Three years ago, we were looking at a renewables business with a dilemma. Should we expand or should we sell the business? And the reason for that is to meet the goals for India. We needed somewhere between $5-10 billion of long term capital if we were to stay in the renewables business and what helped was first, a set of regulations that enable projects to work efficiently over 25 years.

Second, was market mechanisms to create an investment structure an InvIT that allowed us to attract capital from sources around the world. We just listed that InvIT yesterday and we have all the capital that we need and more we had to tell a lot of investors, sorry, we don't need more capital anymore.

So capital is there. If you've got the right market mechanisms around it, if the projects work, if you can show the returns over time, any other regulatory framework to make it happen? Capital is there.

Fatih Birol: So, I think the COP28, we started with COP28. There were many, many good outcomes such as the tripling of the renewable efficiency, tripling of the renewables, doubling of energy efficiency, methane reduction, moving away from fossil fuels – but one thing I wish it came out, it didn't become stronger. Maybe it is for Baku, now in Azerbaijan, maybe we'll have it namely, how we are going to finance the clean energy investment in emerging and developing countries. This is a huge issue.

Many countries work for COP28, many colleagues are here. I see the Norwegian minister who is one of the architects of it, so there are very good results but this is the main thing left and it is when we look at the last five years, clean energy investment increased from 1 trillion to $1.8 trillion – big increase, whereas the fossil fuel investments remain the same.

But the problem is all of this increase came from the advanced economies and China. What about the rest? So, we need everybody to be on board so therefore, it would be great if the next COP, COP29 in Baku, can have a look at this missing bit and which means for me, the fourth line of our fight against climate change and how we are going to support the emerging and developing countries for clean energy investments.

Tania Bryer: Dr Birol, thank you so much. Unfortunately, we've run out of time. I'd just like a very brief closing remark from each of you. With everything going on in our world with all the geopolitical crises, economic headwinds, how do we keep this topic as a priority? What is your message? Bob, I'll start with you.

Robert E. Moritz: It's a fairly simple one, read the report, 30% savings on the energy usage, $2 trillion of savings from an economic commercial perspective and that gets to your competitive point.

Tania Bryer: Thank you. Dr Shah.

Anish Shah: There is a very strong commercial argument to save energy. It's just about how we do it. And this is where working together as a group to share best practices is going to enable us to get there.

Tania Bryer: Dr Kadri.

Ilham Kadri: Innovation is there. Ingenuity is there. We can do it. We cannot do it alone. So let's do it together.

Tania Bryer: Peter.

Anish Shah: Time is now. It makes economic sense to do it, solutions are available. I echo Bob, read the report.

Fatih Birol: So I wouldn't say read the report because... What I would say, let's trust the people in terms of saving energy but not so much. Let's make the standards and regulations ready so that we move in the right direction.

Tania Bryer: Thank you so much. Thank you to everyone for joining us today.