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Columbia Energy Exchange

100th Episode – Reflections & Outlook On the Global Energy Sector

Guest

Dr. Fatih Birol

Executive Director, International Energy Agency

In celebration of the Columbia Energy Exchange’s 100th episode, host Jason Bordoff sits down with Dr. Fatih Birol, Executive Director of the International Energy Agency (IEA), to discuss key issues influencing the energy sector, including the outlook for oil demand and the impact of new U.S. regulation on energy markets. Additionally, Dr. Birol reflects on his twenty-year career at IEA and the lessons he learned early on that helped him get to where he is today.

View the Transcript

Jason Bordoff:

Hello and welcome to the Columbia Energy Exchange, a podcast from the Center on Global Energy Policy at Columbia University. I’m Jason Bordoff. Today I am excited to announce that we’re airing our 100th episode of the Columbia Energy Exchange. It’s been an exciting two years producing this podcast and a fascinating chance for me to learn, and I hope for all of you to learn, from some of the most dynamic energy and environment leaders around the world. On behalf of my co-host Bill Loveless and everyone at the Center on Global Energy Policy, I want to thank you, our listeners, [00:00:30] for tuning in and supporting this podcast. Now on to today’s show.

How do you celebrate a milestone of 100 conversations about the amazingly diverse world of energy? From hydrocarbons to renewables, from nuclear to efficiency, markets and geopolitics, policy and science? You talk with the man who does it all and knows it all, my friend, Dr. Fatih Birol, the executive director of the International Energy Agency.

With a career at the IEA that [00:01:00] spans more than 20 years, Fatih is one of the most preeminent voices shaping the conversation about the future of energy around the world. It’s especially meaningful to sit down with Fatih in his beloved home country of Turkey in Istanbul, the home of his beloved Galatasaray Football Club. Fatih, thanks for joining us on our 100th episode.

Dr. Fatih Birol:

Thank you very much Jason. This is a great honor that you have chosen me for this very special occasion. Thank you very much.

Jason Bordoff:

So I feel like whenever I talk with you [00:01:30] at conferences, or on our podcast, when people hear you speak, they ask you what’s going to happen with energy. Where’s oil going to go, where’s coal, where’s renewables going? I want to talk about that but before we do, I want to give our listeners a chance, especially we’re here in Turkey, very meaningful for your identity and your background, to give our listeners a chance to learn a little bit about you. You grew up in Ankara, is that right?

Dr. Fatih Birol:

I grew up in Ankara then went to university in Istanbul, [00:02:00] studied electrical engineering. After I studied electrical engineering, I wanted to be a movie director. I made several short movies. At that time they were eight millimeter movies. I got a couple of prices and then I decided to go to Vienna to study film; Filmakademie, I went there.

After a while, after a year or so, I decided to look at something, [00:02:30] which is between engineering and also some social issues, if there was intersection and I thought to study energy economics in Vienna. I got my Masters and PhD in energy economics in Vienna and then afterwards I moved to OPEC: Secretariat in Vienna. I worked for OPEC more than six years as an oil analyst.

Jason Bordoff:

I want to come back to how you started your career at OPEC [00:03:00] and how that influences your thinking about energy today but just tell me what your mother and father did?

Dr. Fatih Birol:

My mom is a housewife and a very good cook as you can imagine, you can understand from me, and my father, my late father, was a doctor, a medical doctor. I learned a lot from both of them but my father is and has been a very important guide.

Jason Bordoff:

How did they shape the way you think about the world today [00:03:30] and how did growing up in Ankara shape the way you think about the world?

Dr. Fatih Birol:

Ankara … What was a major thing for Ankara for me was, at that time, there was not many cars in the streets and we played in the streets but my mom always asked us around five o’clock in the afternoon to come home because the air quality was very, very bad because the lenite used for the [00:04:00] heating. Now it is very clean because it was replaced by natural gas across Ankara. Ankara, I remember playing soccer in the streets and the lenite story to come to gas but now the problem is, the air is clean, but the streets are full with cars so you cannot play anyways again so this is the problem with my father.

Jason Bordoff:

So it’s a good lesson. You increase energy demand with more prosperity but you figure out how to use technology and new energy [00:04:30] sources to clean up the air.

Dr. Fatih Birol:

Exactly, exactly. With my father I learned to have responsibility for the task you have on your shoulders. If you have a responsibility, if you promise something to somebody, you have to do it and I tried to follow his footsteps.

Jason Bordoff:

And then you started your career working for OPEC. How did that affect the way you- what was that experience like and how does it affect the way you see the world of energy today?

Dr. Fatih Birol:

In OPEC, I learned [00:05:00] many things. I am still very good friends with my colleagues in Vienna with OPEC but two things maybe. Even though I had a PhD in energy economics, in OPEC working on the oil markets, I understood the incredible power of data. Data is very powerful, you have to know the numbers, you have to know the difference between growth of 1% and 0.1%. What is the difference between them? You have to have [00:05:30] a feeling for the numbers. I got that feeling, this is one.

Second, I understood working for OPEC, I looked at IEA from a different perspective and now when I am in the IEA, I look at OPEC from a different perspective but what I learned is the interdependence between the produce and consumers. This is very important that there are of course different interests, different views, but it is important that the consumers and producers have a very good dialogue with each other. They may have [00:06:00] different policies, different interests but interdependence is the name of the game.

Jason Bordoff:

You were there for how long at OPEC?

Dr. Fatih Birol:

Six years, I worked more than six years.

Jason Bordoff:

And then to the IEA?

Dr. Fatih Birol:

I moved to IEA as a very genere person, just as equal to number cruncher, and-

Jason Bordoff:

And that’s quite unusual for the head of the IEA to have spent their whole career at [crosstalk 00:06:22].

Dr. Fatih Birol:

The first time. The first time that somebody goes within the ranks. First time a non-politician, as [00:06:30] I said a number cruncher or something like that. And the third one is I was the first one who was chosen unanimously by all the countries.

Jason Bordoff:

How do you think that changes the way the IEA operates or is- to be led by someone who is a technical energy analyst as opposed to a politician?

Dr. Fatih Birol:

I pay [00:07:00] a lot of attention to the consistency of the messages and the effect between the numbers and the policy messages there is a good breach and a logical flow between them. When I am presented with the results of my colleagues, of course, I look at them very, very careful and when you are a politician, and of course politicians have a lot of advantages, but one of the disadvantage is they don’t know the numbers. So [00:07:30] knowing the numbers is at an advantage. At least having an understanding of the numbers in my case is an advantage and we have a very collegial working culture at IEA and it is very helpful.

Jason Bordoff:

You’re a pretty good politician too by the way.

Dr. Fatih Birol:

Thank you very much. If it is a good thing or a bad thing, you are telling me.

Jason Bordoff:

What attracted you to the IEA, why did you choose to leave OPEC to go there?

Dr. Fatih Birol:

I have to be honest it was not mainly professional reasons and I stop [00:08:00] here.

Jason Bordoff:

How is the IEA different today than when you joined?

Dr. Fatih Birol:

It is very different, I mean, when I joined the IEA all the work was mainly focused on oil. We work on everything gas, renewables, electricity markets and we are, especially in the last two years, we open our doors to emerging countries. One of the reasons why I was so happy to be the head of the IEA [00:08:30] is that I didn’t want IEA to be quoted in the Wall Street Journal or the FDA as the “rich man’s energy club.” I wanted to change it and I think in the last three years we have now six major associate members, namely, China, India, Indonesia, Singapore, Morocco and very soon Brazil, and Mexico is joining the IEA in November and wonderful country, very big country. These are all changing not only IEA’s [00:09:00] image but also our working culture.

Jason Bordoff:

Well yeah, where the energy is consumed around the world and produced has changed a huge amount in the last four years. IEA needs to evolve with that.

Dr. Fatih Birol:

Exactly.

Jason Bordoff:

As you said, a big shift from a focus on oil to all forms of energy, a lot of work on the importance of climate change. That’s something that’s very important to members of the IEA.

Dr. Fatih Birol:

Definitely.

Jason Bordoff:

How do view the difference between advocacy and analysis? Is that a challenge for the IEA?

Dr. Fatih Birol:

[00:09:30] Definitely. We don’t want to be a lobbyist for this field or that field, we are a data driven organization. We look at the data, we make our analysis, we put options on the table. We tell the governments, decision-makers, industry, if you go this way, this is the results you are going to face. This is what the picture you are going to end up with. If you like it, it is okay but if you don’t like it, there’s an alternative way you look at here. Climate [00:10:00] change is one of those and as you know, Jason, more than two thirds of the emissions causing climate change come from the energy sector. As a leading energy organization in the world, if IEA doesn’t carry out important work on climate change, I think we wouldn’t fulfill our responsibility. Therefore, climate change, other environmental issues such as local pollution, air pollution are key topics for us.

Jason Bordoff:

Now you have [00:10:30] what you’ve called your dream job running the IEA. Actually there’s one job you want more, you’ve told people.

Dr. Fatih Birol:

Yeah one job exactly. My dream job would have been playing the striker of Galatasaray, my football team, but I think my chances with 59 is very slim now to get that job. I got the second best.

Jason Bordoff:

You get to come back and see the matches and follow Galatasaray often?

Dr. Fatih Birol:

Yes I do, very, very often. I watch on television all of the time and I [00:11:00] make all of my speeches, everything here when I go, where I go, according to the fixture of my football team so I can watch the matches.

Jason Bordoff:

That is a true fan.

Dr. Fatih Birol:

Yes.

Jason Bordoff:

So you take over the IEA a few years ago and then, in addition to expanding the membership, tell us a little bit more about where the IEA, where you see it going. What direction you want to take it in.

Dr. Fatih Birol:

I think expanding membership is, I believe, very important to have a strong relationship with those [00:11:30] countries. Today, having influence on the Chinese, Indian, Indonesian decision makers is extremely important for the world and through that we could make a difference. This is one area, in fact, we call it the modernization of the IEA, this is the first pillar.

other two pillars are, we have been built as the organization for the oil security. This is good but we also wanted to look after the gas security and electricity security. [00:12:00] So we see mandates from our governments to look after gas security, electricity security, especially in the context of renewable energy’s share is increasing significantly in the electricity generation. Electricity is important, this is the second one.

And third, we have a pulled position in terms of the tradition of fuels. Oil, gas, coal and nuclear. We also want to be clean energy technology hub and a leader of energy efficiency and we are making [00:12:30] major achievements, including having the Clean Energy Ministerial, hosting it at the IEA now, as of January this year.

Jason Bordoff:

I want to shift to talking about some of the issues in energy and you brought up one of them by talking about electricity security and the rise of renewables. As you know, the Trump Administration has recently proposed a new regulation that would guarantee recovery of costs to coal and nuclear because of a concern that the decline of coal and nuclear [00:13:00] undermines electricity reliability. Does the data bear that out, is that a real concern?

Dr. Fatih Birol:

We are looking into that proposal and we don’t have the outcomes yet but I can tell you that United States is today number one country in oil production, number one country in gas production, number one country in terms of CO2 reduction and number two country in terms of renewables. U.S. is only second to China in terms of renewable energies and huge [00:13:30] potential there, both wind and solar, as other renewable energy sources. I expect renewables under any political circumstances will grow significantly in the United States in the next years to come.

Jason Bordoff:

We would need several hours to talk about all the interesting, fascinating things going on in the energy world but just a couple of things that are top of mind for people … this idea of peak oil demand. We’re going to see a faster transition, that oil demand will peak [00:14:00] and gradually start to decline. That’s not the reference case in the world energy outlook but how do you feel about the possibility of peak oil demand, what role will electric vehicles have and all the other parts of the oil sector, aside from passenger cars?

Dr. Fatih Birol:

Let me give you, first of all, in the short term a number and a bit of a startage point your main question. After the peak oil debate has been put on the table and became lively, global [00:14:30] oil demand growth accelerated substantially. I don’t know if there’s a relationship or not but it’s about 1.5 million barrels per day, very strong growth and this is something to underline. This is number one.

Jason Bordoff:

Does that tell us the elasticity of demands may be even greater than we thought it was?

Dr. Fatih Birol:

Exactly. This is what I expect. The second thing is the-

Jason Bordoff:

Because we’ve had … This happened just in the context of a steep price collapse over the last few years so demand has responded to that lower price.

Dr. Fatih Birol:

Exactly. Exactly.

The second thing is, when we [00:15:00] look at the global oil demand quote, where it comes from, a car is definitely a very important part of the game but there at least three other important drivers. Namely, trucks, the petrochemicals and the navigation in the ships all together, put all of them together. For example, for trucks, when you look at the, forget the forecasts, when you look at the last 50 years but forty [00:15:30] percent of the global oil demand growth came from cars and forty percent of the global oil demand growth came from trucks. When you look at the future, trucks play a much more important role than cars.

Petrochemicals, not many people talk about it but they are major oil demand growth center. I think one of the, I believe, tasks of the IEA should be to look at different blind [00:16:00] spots in the global energy debate and bring it to the attention of the people. So we did for trucks, for example, and we are going to make a major study now on petrochemicals because in this area, trucks, petrochemicals, aviation, to find alternatives to oil production is very, very difficult, if at all possible.

What you can do is you can improve the efficiency. But when you look at the efficiency since there is so much focus on electric cars or cars in general, more than 45 countries have [00:16:30] efficiency standards for cars but only four countries have efficiency standards for trucks, only four. Even though the oil demand, CO2 emission, is much stronger than cars, trucks don’t get the attention. Therefore, I believe in a normal, in a reference [inaudible 00:16:49] case, which is in line with the NDC’s of the governments around the [inaudible 00:16:55] nation determine the contributions, in a reference case we don’t see oil demand [00:17:00] to peak. We expect the growth may slow down as a result of electric cars improving efficiency and so on but oil demand will not peak.

We will need, in response, not only because of the oil demand is growing, there’s other subject, it is one of the areas I was not able to convey since six, seven years I am working on it, experts understand [00:17:30] it but to give it to public is very difficult namely, oil fields are like human beings. When they are young, they produce a lot of oil, when they come to a certain level of maturity they peak and then they decline their productivity. So we have to also get new oil, new fields to produce oil, to compensate the decline of the existing fields and plus to meet the growth in the oil demand growth, which is altogether near about five million [00:18:00] barrels per day new addition production per year. One, one and a half for the oil demand growth. Three, three and a half for replacing the decline in the field. Therefore, it is very important that we see investments are coming at time [crosstalk 00:18:15].

Jason Bordoff:

One thing I’ve been interested in lately is, let’s assume peak oil demand does happen sooner than we think. That doesn’t mean the end of oil, that could be in a plateau or even a gradual, gradual decline. That’s still a lot of oil in the global market but that shift from [00:18:30] gradual increase to flatter, gradual decline could have an enormous impact on the equity values of oil companies, on the ability of them to make long-term multi-billion dollar investments in new supply. People assume lower demand means lower prices but we could actually see more volatility, more sharp, short falls. Do you agree with that?

Dr. Fatih Birol:

I think my biggest worry is following investments are not coming for whatever the reason is. We have seen ’15, ’16 each year, twenty- [00:19:00] five percent decline in the oil investments for new projects, and ’17, the best case is they are flat. We don’t see a big rebound. Three years in a row, ’15, ’16, ’17, not a significant increase in the investments way well have consequences in the next few years to come because again, demand is growing as we talk and also there’s a decline in the mature fields. We may well [00:19:30] have some challenges in the next few years to come if the demand continues to be so strong.

Jason Bordoff:

Have we seen peak oil in China?

Dr. Fatih Birol:

I don’t think so. It is slowing significantly but I think it will be too early to call that oil demand in China peaked.

Jason Bordoff:

Coal [crosstalk 00:19:46].

Dr. Fatih Birol:

Coal. Coal peaked definitely. It is since almost two years we see a decline in coal. We may see zig-zags, there can be a rebound, but I don’t see the share of coal increasing in China.

Jason Bordoff:

[00:20:00] But global coal demand has not peaked.

Dr. Fatih Birol:

Global coal demand in last two years, there is a decline. We don’t know if there will be a rebound significantly, which I wouldn’t take it very likely, there may be zig-zags again but a strong rebound, no. Because what is happening is the coal industry, one of the biggest hoops, was India to compensate the decline in China. When you look at India today, solar prices are [00:20:30] very competitively with the coal prices for this generation. Therefore, of course, India is going to build new coal plants and other southeast Asian countries, but to see a big increase in the coal consumption globally is very difficult unless we get some good news from the carbon capture storage.

Jason Bordoff:

When we talk about issues like this, I think some people listening [00:21:00] may be thinking but the eye is always conservative on the pace of disruptive change, of new technologies, of new innovation. We’ve seen renewable costs come down faster than past world energy outlooks, the pace of renewables growth faster, and this whole pace of transition is going to be faster.

First of all, tell us about the art of these projections. Do you think those kind of criticisms are fair? That things are going to happen faster than groups like the EIA [00:21:30] or the IEA think?

Dr. Fatih Birol:

First of all I want to be very honest. We don’t claim that we own the truth. We try to bring a lot of data analysis as much as we can in an unbiased way, objective way. This is number one.

Number two, we don’t have commercial interests. We are not selling anything. We are just an intergovernmental [00:22:00] organization.

Third, and this is important, we do not make forecasts. What we try to do is, we say, “these are our assumptions. Based on the policies that the governments have today, this is the world you are going to end up with.” For example, the current policies, if the governments by the NDC’s, they are going to end up with a world, which is about three [00:22:30] degrees Celsius warmer than today with huge consequences. This is not something we want to happen and this is not something that we think is likely to happen. This is what we are saying is, if [crosstalk 00:22:42].

Jason Bordoff:

You’re not assuming new policy and [crosstalk 00:22:44].

Dr. Fatih Birol:

Exactly, no new policies.

Jason Bordoff:

And what about the pace of technological progress?

Dr. Fatih Birol:

Yeah. We had assumptions on the cost improvements, for example for solar, and to be honest with you, because improvements of solar has been much faster than we [00:23:00] had assumed, mainly as a result of new government policies supporting those technologies. Therefore, what we have done this year is we have revised up our solar projects substantially, which personally gave me a lot of pleasure. I don’t feel that we had to revise up the numbers, it is a bad news, I think it is very good news because I believe solar has to have a bigger share as it is a fuel, which is [00:23:30] good for energy security, good for environmental issues and good for the consumers.

Jason Bordoff:

And that was partly because of policies that increase demand, also because costs came down and in part that was industrial kind of policy decision in China [crosstalk 00:23:47] own a new global industry. Do you think they will do that for electric vehicles and could that cause the price of electric vehicles around the world to come down much faster than we think?

Dr. Fatih Birol:

First of all, solar is China’s story. I [00:24:00] can tell you, and this is a, today, six out of ten solar panels produced in the world are in China or by China’s companies. The rest, other countries, and if China today would change its policies for solar in a less optimistic way, a negative way, we could again see a different solar would. In my views, China [00:24:30] is the Saudi Arabia of oil in solar. This is when I look at the picture.

It comes electric cars, in any ways electric cars will grow stronger, but as much as I am very happy to see electric cars more and more in the streets, they require substantial about of subsidies. So you can subsidize 10,000 cars, 20,000 cars, 30,000 cars, but if the [00:25:00] number of cars increase, the subsidy you will give may have implication for your government’s budget. Therefore, if the prices don’t come down substantially … To see that some observers expect, more than half of the cars, electric cars, sometime soon may be on the optimistic side.

Jason Bordoff:

The World Energy Outlook always picks certain topics to have a special focus on. This new [00:25:30] one will have a special focus on natural gas. Can you give us a preview of some of the highlights?

Dr. Fatih Birol:

Natural gas is going through another big revolution. The first one, to be very fair with the World Energy Outlook and not to be on the modest side, in the year 2008, we said that a silent revolution is starting in North America. Talking about the shale gas revolution. And now [00:26:00] we are seeing a second revolution now. That shale gas revolution is giving birth to an [inaudible 00:26:06] revolution. Together with Australia and the coal bed methane and the others and what I see, Jason, is this is changing the constitution of the gas markets in terms of the contracts, prices, geopolitics of gas and we thought it is not time to discuss these issues. A [00:26:30] new gas picture in the world and we are giving a fresh look at it both from a producers side and from consumers side and of course United States will be at the center of that [crosstalk 00:26:42].

Jason Bordoff:

And just to help our listeners understand why it’s having those impacts because as gas becomes a more flexible commodity, as it takes to the water rather than fix pipelines, that explains that that’s giving people more choices and consumers, it’s creating more competition.

Dr. Fatih Birol:

Gas means, for me, there are many advantages [00:27:00] and other things but if I have to nickname gas, I will say Mr or Mrs Flexibility because it gives you flexibility for everything from a consumption side to the transportation, from transportation to electricity made, dispatching, a lot of flexibility. Many, many countries, these are all very clever countries, many small emerging countries are building LNG [00:27:30] import capacities now. It is in less than six, seven years of time, the number of LNG importing countries went from 15 to almost 40 today. They are not going to buy LNG, perhaps in a very every day, in a continuous manner, there are some opportunity buyers. If the prices go down they will look at the markets and they will get LNG and fit in their system.

[00:28:00] What we are going to see is that LNG will be used, gas will be used in general, more and more. Not only for electricity generation but also in the industrial sector and for heating. China and India are the countries, if you look at them, especially for substituting coal and creating flexibility in electricity generation with renewable energies.

Jason Bordoff:

What impacts does that have if you shift from long term contracts to more of a spot [00:28:30] market? What does that mean for security of supply and price volatility?

Dr. Fatih Birol:

I think we will see a lack in the oil markets. We will see oil prices being more volatile and the hands of the buyers will be stronger. The old habits such as having this nation [inaudible 00:28:58] [00:29:00] may not be, because in the next few years will come anymore, because there will be a lot of competition. This is good news, this is definitely good for gas security. At the same time, we know that even with gas, lots of gas today, the gas, you’re going to see, will be still an issue. We have seen the issues around Qatar, very recently, currently the largest LNG exporter of the world. Also we [00:29:30] have seen the problems in the United States, the Harvey and others, Maria and others, means that we still need some security net for both oil and gas.

Jason Bordoff:

There’s still a lot of geopolitical risk that affects energy markets [crosstalk 00:29:48].

Dr. Fatih Birol:

Very much so.

Jason Bordoff:

Qatar is one example you mentioned. There’s a lot of areas of geopolitical risk we could talk about. We don’t have time for all of them but I want to ask you just about one because we’re here. Turkey and its response to [00:30:00] the recent independence votes in the Kurdish region. What do you think that’s going to mean for oil supply, gas supply, if anything?

Dr. Fatih Birol:

Iraq is, as you know as much as I do, Iraq is producing today 4.5 million barrels per day. Very important country in terms of oil production and we have these issues in Northern part of Iraq with the Kurdish region government. I really hope that the problems between [00:30:30] Erbil and Baghdad are solved in a peaceful manner but currently in the recent developments, as we looked in our last oil market report, didn’t have any significant impact on the oil markets.

Jason Bordoff:

Another area of geopolitical uncertainty now is the United States with the new President Trump likely to de-certify the Iran deal, withdraw from the Paris agreement, threatening to abandon trade agreements like NAFTA. [00:31:00] How is that being perceived at the IEA? How is that being perceived from other producer and consumer countries? What impact does that have on climate and energy trade?

Dr. Fatih Birol:

I think the United States being the largest economy of the world and perhaps the most important energy player in the world, the policies that the United States will adopt will affect everybody, there’s no doubt about this. But when I look at the [00:31:30] dynamics of the U.S. energy markets, the fundamentals of them, as you did with Columbia University with your work some time ago, I see the dynamic will be the fundamentals of natural gas, renewable energies are very, very strong. I would expect that whatever the policies coming from the new administration, I believe we will still see strong growth of [00:32:00] natural gas, we will still see strong growth of renewable energies.

I would like to see U.S. being on the forefront of the carbon capture and storage, this is extremely important technology, but there is no leader in the world. For example, when it came to renewables, we have seen these big cost reductions. Some European countries were the leaders and others supported them, followed them, but there was a leadership there. Then, [00:32:30] China took the leadership in terms of renewables.

Now in terms of electric cars, we know that China is pushing this very strongly, I would be very happy to see a U.S. leadership takes the leadership for CCUS. Many other countries who are very strong in this, such as Australia, such as Norway, Canada, this would be excellent. In [00:33:00] fact, when I look at the three countries in North America, not just the States, Canada and Mexico, I believe we may well see a North American energy region here.

Jason Bordoff:

Would canceling NAFTA change that vision?

Dr. Fatih Birol:

I don’t know what will happen with NAFTA but if I can tell you something, until this event we talk about oil and gas, especially oil, the first region [00:33:30] came to our mind is … was Middle-East. Gas, Russia. Energy consumption and demand growth, Asia. I believe if policy makers are wise enough, U.S., Canada and Mexico, very important dynamics there, working close together, may well be another region emerging and there’s a lot of opportunity for the synergies there.

Jason Bordoff:

[00:34:00] And you need those kind of policies to change the way companies make investments. We’re starting to see international oil companies increasingly focus on electrification, batteries, off-shore wind, but what’s your perception of where the major oil and gas companies are? Is this still kind of marginal or do you see a big change in the way they think about the energy transition?

Dr. Fatih Birol:

I think some of the big ones are seeing that the electricity is the future, [00:34:30] especially European ones, and they are putting increasing share of their portfolio in electricity markets in terms of being an electricity producer or in terms of electric cars. But it will be too premature to say that they are diversifying their portfolios substantially. They are still oil and gas companies but they are looking at electricity carefully [00:35:00] and I believe the U.S. companies are also looking at how the technology can change the consumption patterns including the big ones in the United States.

Jason Bordoff:

Fatih I wish we could go on for hours. Unfortunately we’re out of time. We have 100 weeks until our 200th episode so hopefully you can join us again then but I’m certain you’ll join us in New York City at Columbia’s Center on Global Energy Policy in the very near future. Thank you for taking the time to be with us today.

Dr. Fatih Birol:

I thank [00:35:30] you very much Jason and we are all glad in Europe that Columbia is in New York.

Jason Bordoff:

We look forward to welcome you back soon and I want to thank all our listeners for tuning in. Don’t forget to rate our podcast on iTunes and for more on insights on energy issues today visit us at energypolicy.columbia.edu or follow us on Twitter and Facebook at Columbia U Energy. We’ll be back next week. I’m Jason Bordoff, talk to you then.

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