The harnessing of energy is what makes possible the world as we know it. The bounty can be measured in terms of virtually everything we do in the course of a day. But can we bet on that for the future?
The growth in world energy demand in the coming decades will be very large, an increase of as much as 35 to 40 percent by 2030. Can this need be met? This increase alone will be greater than all the energy that the world consumed in 1970. Underpinning it all is a fundamental shift in global energy demand, which reflects big changes in the world economy.
At the start of the 21st century, "developed" countries still represented two-thirds of total oil demand. By the end of the decade the split was 50-50 and the shift continues to this day. In terms of oil, North America, Europe and Japan have already reached peak demand. Because of demographics, increased efficiency and substitution, their petroleum consumption will be flat or declining.
The story will be entirely different in emerging markets owing to what I call the "globalization of demand." China already consumes more total energy than the United States. The same will be true of oil perhaps by the end of the decade, as China becomes more motorized. This year, 20 million new cars will be sold in China, compared to about 15 million in the United States. Some think that number could grow to 30 million.
(Read more: The Rising Irony of the Beyond OPEC Era)
Even with much greater energy efficiency, rising incomes and standards of living will mean much greater requirement for energy. What kind of energy mix would make this possible without crisis and confrontation? The answers to these questions will be critical to the future.
Innovation will be critical. Fortunately, innovation is a constant feature of the energy system. Solar and wind, which have become so prominent, really had their origins as innovations in the 1970s and 1980s.
The biggest innovation so far in the 21st century is shale gas and the development of "tight oil" that has come with it. This has now reached such a scale that it can be called the "unconventional revolution in oil and natural gas."
Half a decade ago, the United States was expected to be a major importer of natural gas. Now it is so well-supplied that it will export natural gas. U.S. oil production is up almost 45 percent since 2008, and in fact the fastest-growing source of new oil development in the entire world is the United States. This is not what was even imagined a few years ago.
This revolution is having a major economic impact. It currently supports 1.7 million jobs—a number that could go to 3 million or more by the end of the decade. It is happening so fast that thinking still has to catch up. A key question for the future is when this revolution will spread beyond North America. One thing that is clear is that natural gas will assume a bigger role in the world's overall energy mix.
(Read more: Leapfrogging the Shale Learning Curve)
The interaction of environmental concerns with energy will continue to shape the energy marketplace. The biggest question is climate change and carbon. Over 80 percent of world energy is supplied by carbon-based fuels—oil, natural gas and coal. About 75 to 80 percent of world energy is generally expected to be carbon based two decades from now.
Yet the growing importance of the climate change question ensures that this ratio will be strongly challenged both politically and technologically as people strive to decarbonize.
A move away from carbon-based fuels has already begun, but we are in the early stage of a transition—or at least a remixing of the energy mix. Wind and solar are growing rapidly, but they are still a very small part of the overall energy mix.
The two biggest sources of carbon-free electricity today are nuclear and hydropower. Nuclear is growing in some parts of the world, but in others it is stymied. While China is building up its nuclear electricity very fast, Germany intends to shut down all of its nuclear by 2022.
The pace of technological advance is not the only factor affecting the speed of any transition. Another factor is the law of long lead times.
(Read more: Why We Need to Help China Frack)
The energy system is large and complex, with an enormous amount of embedded capital. It does not turn over with anything like the speed of mobile phones. A power plant may have a 60-year life span or even more. A major new oil field may require a decade or more between exploration and first production.
By the early 2030s, the world will be using a good deal more energy. But the reason that the mix will not be too different is that rapid growth of demand in developing countries, where coal has such a big role.
The law of long lead times still remains. It is really after 2030 that the energy system could start to look quite different as the cumulative effect of innovation and technological advance makes its full impact felt.
Energy efficiency remains a top priority for a growing world economy. Remarkable results have already been achieved, but technologies and tools not available in earlier decades are now at hand.
The real advances will be embodied in behavior and value, but especially in investment—new processes, new factories, new buildings, new vehicles. There are many obstacles, ranging from financing to the fact that efficiency usually comes without the opportunity for good "photo ops." There is "no ribbon to cut."
The challenges of meeting rising energy needs in the decades ahead, of assuring that the resources are available on a sustainable basis to support a growing world, may seem daunting; and, indeed, when one considers the scale, they truly are.
Meeting them requires, among other things, the responsible and efficient use of energy, sound judgment, consistent investment, statesmanship, collaboration, long-term thinking and the thoughtful integration of environmental considerations into energy strategies.
But what provides for reasoned confidence is the increasing availability of what may be the most important resource of all—human creativity. A famous geologist once said, "Oil is found in the minds of men."
We can amend that to say that the energy solutions for the 21 century will be found in the minds of people around the world. And that resource base is growing.
_ By Daniel Yergin
Yergin is vice chairman of IHS and author of "The Quest: Energy, Security and the Remaking of the Modern World," upon which this article draws. He received a Pulitzer Prize for his book "The Prize."