Today, we are going to discuss scenarios, and I will introduce to you some of the leading scenarios for the future of energy. What is a scenario? A scenario is an image of a possible future condition. It's not a forecast. We cannot forecast the future. We cannot predict the future. Today, we see that we are unable to predict even demand for energy in the short term. We make mistakes. We need to adjust our expectations on a continuous basis, sometimes by a large margin. So forecasting is very difficult, and one should not interpret scenarios as forecast. Scenarios will always be wrong. We can have an image of the future today, and when we come to that time, we will see that things have evolved in a direction which is completely different. So you might ask, why bother? Why are we doing it? It is always wrong. The fact is that in our everyday life, we need a view of the future. We always, even as individual, have some concept of what our future will be. As states, as governments, we need to have an idea of how things will evolve in order to adjust our decisions and optimize, if possible, our decision-making. So although we know that in actual life, things will evolve in a completely different, on a very different directions. Nevertheless, at any moment in time, we try as much as we can to project into the future, and see how we can best manage ourselves, our companies, our governments. So we need scenarios for various purposes. Sometimes, it is in order to promote specific policies. I want to convince you that we need to do more in terms of, say, solar energy, and then I propose to you a scenario that shows what the benefits might be of relying more on solar energy. I want to propose some other policy direction and then I have to evaluate what the implications of that policy directions will be. Sometimes, I need to make an investment decision. We are speaking about the energy industry. In the energy industry, there is a long time separating the moment that investment decision is made, from the moment an investment comes to fruition. I may decide today to have a new oil refinery. The refinery will be there 12 years from now. I may decide today to go exploring for oil in the Arctic, for example, my first barrel of oil, if any, may come 20 years from now. So we need to have a scenario about the future in order to decide, does it make sense? Does it not make sense to engage in this investment? Then we need scenarios also, because very frequently we are tempted to take decisions that are contradictory or policies that are contradictory. In other words, we tend to wish something and the opposite of the same thing. This is very human, okay? We solve contradictions, we solve trade-offs by assuming that they do not exist, but they do exist. They do exist. So scenarios are useful, because they point to us the critical decisions that we need to make, the trade-off that we need to accept, and we need to make a choice. So when we see a scenario, we always have to ask ourselves, what has motivated this piece of work? Why is this being presented? What is the objective of whoever as elaborated a scenario in presenting this scenario? Because everything has a bias. There is no such thing as a totally unbiased scenario. The bias cannot be eliminated. It's there necessarily. So all you can do is to be aware of the bias, and try in your mind to compensate for it. Scenarios are based on assumptions. You need to formulate assumptions about the futures in to explicit certain rules that allow you on the basis of the assumptions to project today's realities into the future, and come up with a picture of what the situation will be. Assumptions, of course, are very subjective. We have no evidence. They are assumptions. So we make assumptions about things like population growth, economic growth, about war and peace, about the policies that will be implemented, and so on. All of these things need to be explicit in some fashion, and we don't know, so we need to rely on assumptions. Much of the difference between one scenario and another is a difference in the assumptions that are underlying each scenario. Next, you have to keep in mind that scenarios are complex. It's a very significant piece of work and requires a significant effort on the part of a team, of numerous people, requires building a mathematical mode. It's not something that is done easily, so not everybody can do it. We have certain number of scenarios from companies. We have scenarios from international organizations from governments. Sometimes, from non-governmental agencies. We will present in particular the scenarios by BP and Shell, but perhaps, the most authoritative are, and most frequently quoted are the scenarios that come from the International Energy Agency. The International Energy Agency publishes every year a book called The World Energy Outlook that presents three scenarios of the possible evolution of the energy system over the next, generally, 30 years. So we will refer to the scenarios of the International Energy Agency a lot, keeping in mind that these are scenarios. There is no one that is necessarily better or worse. There is no one who is right and another one is wrong. No, they are just different images of the future based on different assumptions. So each of them has a message that is interesting and deserves to be looked at. Whether you like it or not, you have to understand why that message is there. You have to understand why that conclusion is reached. So one thing that you need to focus on when looking at scenarios, as either points of convergence between scenarios or other points of divergence. If scenario is on converge on one conclusion, then it is highly likely that conclusion will be confirmed by reality. So we need to use scenarios, focus on scenarios at the same time, in the awareness that these are just speculation. They are just images of the future, and in fact, our experience tells us that things will always go differently, and the word is always full of surprises.