Demand for Energy and Energy Generation: Does Regional Energy Policy Play a Role? Paul OJEAGA 1* , Odejimi DEBORAH 2 1 PhD Bergamo Italy, Graduate of Industrial and Applied Economics from the Department of Mathematics, Economics and Operations Research Bergamo Italy 2 PhD Benin Nigeria, Dean of College of Arts and Social Sciences Igbinedion University Okada Prepared for Global Energy conference in France 2014 Abstract Does regional energy policy play a role in regional energy generation? What does the implication of the current industrialization trend mean for the generation and the supply process across regions? And to what extent does regional energy policy affect energy security (energy supply risks) in regions? This study investigates the effect of regional energy policy on regional generation characteristics in seven regions of the World using regional panel data from 1980 to 2010 a period of 31 years although some years of data are missing. It was found that regional energy policy were been shaped by pollution concerns and that cost reduction needs had strong effects on energy security (energy generation resources supply). The method of estimation used is the quantile regression estimation method which provides robust estimates after controlling for heterscedastic errors and is robust in the presence of outliers in the response measurement. Energy policy has strong implication for access to sustainable supply of energy generation resources however it had little or no effect on energy generation itself. Industrial demand for energy particularly in the developed countries were probably also making developed countries depend on more nuclear and hydro energy generation sources. Keywords: Kyoto Protocol, Energy Policy, Energy Generation and Generation Sources. 1.0 Introduction In this section we introduce the topic of discussion. World demand for energy is on the increase particularly with the industrialization drive currently being experienced in emerging economies. For instance from 2016 the United States will no longer be the largest importer of oil from Nigeria since their imports will be overtaken by China 1 . Other issues that bother on consumption patterns such as emissions are also likely to affect regional energy policy. It is clear that the Kyoto protocol might not be realizable in near future with major energy consuming nations withdrawing from the Doha 2012 round of talks and other circumstance that point to the fact that emissions cut are not likely to be met in the future. Energy generation across regions will be affected by the dwindling availability of fossils as well as drive in improving innovative generative capabilities for cleaner and more sustainable methods of energy production. Lots of papers e.g. Knox-Hayes, Brown et al (2013), have also tried to address issues of energy demand and supply risk in the generation process. However few have tried to relate specifically the effect of industrial demand for energy on regional specific energy generation and supply. It is also noticeable that industrial energy consumption is on the increase and noticeable industrialization trends in regions mean that this will continue to remain so in the near future 2 . Regions are also highly concerned about cost of each generation source and are likely to continue to diversify their production capabilities to mitigate supply risks Ojeaga, Azuh and Odejimi (2014). For instance the paper Cohen et al 2011 argue for diversification away from fossils due to overdependence stating that one way of risk reduction were probably depending on a variety of energy sources for generational purposes. Cost of generation- can have strong implications for –energy- stakeholders and -policy makers- forcing countries across regions to source for cheaper and sustainable ways to improve generational capabilities EU Green Paper 2001. The role of regional policy and industrial energy consumption on energy supply and generation remains unclear. The question if countries across regions are actually concerned about industrial demand for energy and the effects * Email of Corresponding Author: paul.ojeaga@unibg.it 1 Nigeria National Petroleum Corporation (NNPC) Oil Projection for Nigeria 2013 2 (World Bank Statistics 2010)