The economic recession has barely dented global usage of electricity in the long term leaving both power generators and their insurers having to cope with major rises in demand for their products over the next 20 years.
This was the prognosis from Dr Robert P. Hartwig, President of the Insurance Information Institute, as he spoke at an AEGIS London-hosted energy conference in Prague yesterday. Global energy consumption in 20 years’ time will only be impacted by the recent financial crisis to the tune of 2%, Dr Hartwig said.
Addressing the issue of the economics of the global property and casualty insurance industry in relation to energy, Dr Hartwig argued that rising demand for energy, fuelled in part by the development of economies like China and India, was driving the need for unprecedented levels of investment in global power generation infrastructure.
Dr Hartwig put the investment bill for Europe alone over the next 20 years at US$1.351 trillion. Most of this money, he said, would be spent on power generation and distribution, with power transmission as the third priority. This will, according to Dr Hartwig, mean significant demand for energy insurance.
