ABSTRACT
This chapter examines the scope for energy policy to respond to the challenge to realize sustainable development for present and future generations. For most economic activity, energy is just an input and it is neither difficult nor expensive to obtain. Energy is also a strategic issue influencing national development and energy scarcity. Fossil fuel prices, when left to the market, have not provided an incentive for improving energy efficiency or for employing renewable energy on a large scale. It is necessary to recognize that to design a sustainable energy policy for the future, it is not enough to rely on market signals that are derived from the appraisal of volume and price for energy commodities. Developing countries have been excluded from much of the discussion on global environmental change. Furthermore, their short-term economic and energy security problems imply that, if a new mode of energy and development is not found, they will increasingly contribute a substantial proportion of carbon emissions.
