Yergin: Climate Change and Energy are Converging into New Era of Clean Energy

Entering a Period of "Great Bubbling" Driven by Innovation across
the Energy Spectrum
CAMBRIDGE, Mass.--(Business Wire)--
"High energy prices, climate change and energy security are
converging as the new engine driving the development of clean energy,"
Daniel Yergin, chairman of Cambridge Energy Research Associates (CERA)
and executive vice president, IHS Inc., said today in Washington, D.C.
"There is a major shift in public opinion towards clean energy, which
is being bolstered by the growing conviction that new carbon policies
will reshape the competitive landscape of the global energy business."

Yergin spoke at the 2008 National Governors Association (NGA)
Winter Meeting. The organization's members are the governors of the 50
states, three territories and two commonwealths of the United States.
Making the nation a global leader in clean energy was the key topic of
this year's meeting.

Citing CERA's new study, Crossing the Divide: the Future of Clean
Energy, Yergin said that renewable power and biofuels could be
supplying as much as 16 percent of the global electric and
transportation needs by 2030. "We are going through a period of what I
call the 'great bubbling,' a high degree of innovation all across the
energy spectrum," he said. "To paraphrase a famous phrase about states
as the laboratories of democracy, the states today are truly
'laboratories' of energy innovation and initiative for the nation.

"There are a broad range of opportunities and benefits, as well as
risks, and pitfalls, as the modern energy industry increasingly moves
to adopt clean technologies that will be part of the alternative,
low-carbon pathway to the energy future," Yergin told the NGA
audience. "All participants in the global energy business, from
traditional firms such as electric power companies and oil and gas
companies to new entrants such as venture capital firms and high tech
companies will play a role in shaping this changing energy future. So
will government at both the state and federal levels."

On current oil prices, he added, "A major reason for the current
leap to around $100 a barrel is the economy - but now a weak U.S.
economy, rather than the strong global economy that has been so
important the last few years. A slowing U.S. economy, rate cuts by the
Federal Reserve and expectations of more, and a weak U.S. dollar -
along with the reappearance of inflation around the world - are
driving investors into oil and other commodities. Instead of the
traditional 'flight to the dollar' during times of uncertainty, we are
seeing a 'flight to oil.'"

He cited several key insights from the Crossing the Divide study:

-- Renewable power technologies are poised for substantial growth
- Wind will make the largest gains, followed by solar power
and biomass -- despite near-term bottlenecks in wind turbine
manufacturing, supply shortages in silicon and competitive
pressures from escalating component costs.

-- Government policy remains a key driver for clean energy
advancement - Putting a price on CO2 emissions, setting
mandates and providing subsidies all work to kick-start clean
energy technologies by meeting the economic competitiveness
and cost advantages of conventional technologies. The
challenge in the years ahead is to provide subsidies in a way
that ensures that these technologies get off the drawing board
and are able to wean themselves from support - allowing for a
phase-out rather than an increase in subsidies - as they
become commercially viable on their own. It is also important
that mandates be set at achievable levels and with care so as
not to create unexpected pressures from higher prices.

-- Clean energy portfolio - A full range of clean energy
technologies along with demand side responses will be needed
to address the challenge of redirecting global greenhouse gas
emissions trends. While many clean energy technologies are
commercially available, more work is needed to develop and
demonstrate a broader set of technologies including advanced
coal systems.

-- Conventional emission-free technologies - Nuclear and
hydroelectric generation will account for most of the clean
energy impact for the next decade, and almost half the gross
clean power additions by 2030. The coal resource base and
utilization in the United States and China will create a
powerful drive to develop "clean coal" technologies.

-- Asia demand and manufacturing - Rapid economic growth may push
Asian energy needs from 30 percent of current global demand to
40 percent by 2030; combined with its manufacturing
cost-competitiveness, this could make Asia a nexus for clean
energy technology research, development and equipment
production.

-- The Economy - Economic growth affects energy demand and carbon
emissions as well as the political and financial support for
research and development of new clean energy technologies.

-- The Big Three: "The Big Three" in terms of energy consumption
- the United States, the European Union and China - will have
a major impact on development of "clean energy," along with
certain other countries, particularly Japan, India and Brazil.

Yergin explained how CERA's analysis in Crossing the Divide uses a
scenarios framework to assess the prospects among the various clean
energy technologies and help define key risks and opportunities as
companies seek to place their technology bets. The analysis addresses
new and conventional energy technologies that can provide energy with
a minimal carbon footprint and facilitate greater energy security.
These technologies include biofuels, renewable power technologies,
carbon capture and storage, nuclear and hydropower.

About CERA

Cambridge Energy Research Associates (CERA), an IHS company (NYSE:
IHS), is a leading advisor to energy companies, consumers, financial
institutions, technology providers, and governments. CERA
(www.cera.com) delivers strategic knowledge and independent analysis
on energy markets, geopolitics, industry trends, and strategy. CERA is
based in Cambridge, Massachusetts, and has offices in Bangkok,
Beijing, Calgary, Dubai, Johannesburg, Mexico City, Moscow, Mumbai,
Oslo, Paris, Rio de Janeiro, San Francisco, Tokyo, and Washington, DC.

For information about Crossing the Divide, contact Michael
Banville at mbanville@cera.com.

(C) 2008, Cambridge Energy Research Associates, Inc. All rights
reserved. CERA and the CERA logo are registered trademarks of
Cambridge Energy Research Associates, Inc.

CERA
Bethany Genier, 617-866-5000
bgenier@cera.com

Copyright Business Wire 2008