Signposts for the evolving energy landscape

Changes in the relative cost of new technologies compared to existing or alternative energy sources may further increase shifts in the global energy mix. Using Company and third-party sources, ExxonMobil monitors a variety of signposts that may indicate a potential acceleration in shifts to the energy landscape. They include:

• New, more ambitious Nationally Determined Contributions (NDCs) submitted by Paris Agreement signatories, along with broad implementation of significant policy and regulatory initiatives, such as carbon pricing.
• Increasing electrification of energy systems and technology developments that reduce costs and increase reliability of energy storage.
• Development of scalable alternative energy technologies such as advanced biofuels, leading to displacement of gasoline and distillate in the fuels market.
• Advances in carbon capture and storage (CCS) technology to lower cost and enable low-carbon hydrogen production.
• Advances in significant new capacity expansions of multiple technologies, as well as the associated financing.

Use of sensitivity analysis

ExxonMobil uses sensitivity analyses to provide greater perspective on how variations to its Outlook for Energy assumptions could affect projected energy supply and demand. The analyses for these sensitivities involve assessing technology advancements and the potential impact on energy supply and demand, resulting in a range of potential low- to high-demand outcomes for certain energy sources. The projections in the sensitivity analyses do not represent the Company's viewpoint or the likelihood of these alternatives, but can provide context to its analysis.

Recent sensitivities included light- and heavy-duty vehicles and natural gas for electricity and power generation, which ExxonMobil has included in its 2019 Outlook for Energy and 2020 Energy & Carbon Summary.