Taking that longer look is something global oil and gas giant Shell has been doing for some years now, too.
In 2023, Shell launched its first Energy Security Scenarios report – a detailed look at the broad trends in energy for the remainder of the century.
Back then, two potential futures had come into view.
The first, dubbed ‘Archipelagos’, foresaw an increasingly fragmented, multipolar world. In this, energy security was prioritised over emissions reductions, resource nationalism over globalisation.
In the second, ‘Sky 2050’, the world focused on tackling climate change and fast forwarding the energy transition. With citizens demanding stronger action from governments, greater regulation and planning on energy use was the result.
Trends from both scenarios are clearly visible today, but in 2025, Shell took another look, updated them – and added a third.
That addition speaks to the astonishing power of a single, rapidly developing technology with multiple implications: artificial intelligence (AI).
AI Power
The new scenario – ‘Surge’ – forecasts a future in which AI reaches practically all aspects of the energy value chain.
Surge foresees accelerated, private sector-led economic growth, with a more dispersed, electricity-based energy system rapidly emerging.
Widespread use of AI leads to faster innovation – often outstripping governmental efforts to regulate it.
Under the Surge, the world achieves quantum advantage by 2030. This is the inflexion point where quantum computing enables the solution of problems that are currently beyond the scope of classical algorithms.
A vast shift in technology then occurs, with a significant cost reduction in electrification and the development of much more sophisticated biofuels.
Carbon capture and storage (CCS) technologies also benefit considerably from AI-driven innovations, with 1 gigaton of CO2 being removed from the atmosphere per year by the mid-2050s.
Another beneficiary is battery technology, with more highly developed batteries more widespread in transport and grid backup.
Modular systems are also more prevalent, with solar photovoltaic (PV) panel manufacturing and deployment – the archetypal modular energy system – accelerating. Panel production – still dominated by China – exceeds 1 terawatt (TW) by 2030, a figure almost twice the current, 600 GW production level.
Also benefitting from more modular system development are small modular nuclear reactors (SMRs). These are rolled out to power everything from data centres to ships.
The dispersed, modular nature of the energy system also benefits many emerging economies. With power able to be assembled ‘lego style’ almost anywhere, regions that previously saw low levels of development can be more easily empowered.
On the downside, however, Surge also leads to higher energy usage in powering AI and in overall faster economic growth.
Net zero does not come until 2080, rather than 2050 in the Sky 2050 scenario, which is re-imagined and renamed ‘Horizon’ in the 2025 report.
In Surge, global warming is around 2oC by the end of the century, which is higher than in Horizon (1.5oC), though lower than Archipelagos (2.2oC).
Resilient Fossil Fuels
While renewable energy and nuclear power get a boost in all three of the 2025 scenarios, what is also striking is that fossil fuels continue to be major components of the global energy mix.
Upwards pressure on energy demand continues for the foreseeable future, as economies develop. Certain key economic activities also continue to be more cost-effectively served by fossil fuels, such as grid generation balancing and marine transport.
Fossil fuel demand does, however, decline from the current level of around 80% of total global energy. The difference between the scenarios is the rate at which this percentage falls.
Under Horizon, decline is the fastest, as renewables are prioritised and fossil fuels subjected to increasing regulatory restrictions and penalties. In Archipelagos, the rate falls slowest, as countries prioritise energy security – continuing, for example, to use domestic coal resources.
In Surge, fossil fuels still make up around 10% of total global energy supply by 2100, while in Archipelagos, the figure is around 20%. Horizon sees usage down to around 5%.
Future in the Balance
As the period between Shell’s 2023 and 2025 reports shows, reality is likely to be a combination of these scenarios, rather than just one, as today, elements of all three are very much alive.
Shell is careful to point out, too, that the scenarios do not represent company policy, or imply any particular advocacy.
They do, however, put some clear choices into perspective.
AI, for example, promises accelerated technological advances and faster growth.
The trade-off is, however, a slower path to net zero and a likely greater impact from climate change.
Non-renewables continue to be a key pillar of the energy mix for longer, too, as countries seek to meet surging demand for electricity. A boom in small-scale nuclear power is also an important outcome.
Perhaps what can be predicted with some certainty, then, is that tackling trade-offs like these is likely to be the business of governments, corporations and populations for many years to come.
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