Fostering Effective Energy Transition for All

The need for global energy transition is now more important than ever. Several factors are making it imperative for policymakers, businesses, and individuals to actively and rapidly shift to a more sustainable alternative, than what we presently rely on.

The increased impact of climate change is one major driver. The current system’s reliance on fossil fuels is environmentally hazardous and ultimately unsustainable. Fossil fuels (coal, oil, and gas) are the primary drivers of global climate change, responsible for over 75% of greenhouse gas emissions and nearly 90% of CO₂ emissions.

The Earth’s supply of fossil fuels is also dwindling. Research from 2015 suggests that oil and natural gas reserves may be depleted within approximately 50 years, while coal reserves could last for about 100 more years. However, if we continue our current rate of fossil fuel consumption, we risk triggering catastrophic consequences for humanity and ecosystems, including unprecedented heatwaves, floods, droughts and other devastating impacts.

Despite international agreements to limit global warming to 1.5°C, many governments continue to authorize new fossil fuel exploration and extraction. “You’ve got governments issuing new licenses or permits for coal that are completely decoupled from their own climate commitments,” said Mark Campanale, founder of Carbon Tracker Initiative. He further added, “it’s like a country announcing that they’re going on a climate change diet and they’re going to eat salad for lunch and then sneaking back to their office and working their way through a box of donuts.”

Other factors such as the rising global population, coupled with increasing energy demands does put the onus on global leaders to find a balance between fulfilling global energy needs and keeping climate change checked. 

Countries Are Pivoting

Global leaders face the urgent challenge of meeting growing energy demands while ensuring sustainable access for future generations. Renewable energy sources are gaining increasing attention as a key solution. While transitioning from 12% to over 57% solar and wind energy generation by 2030 requires a rapid transformation, the success of Uruguay, Denmark, and Lithuania demonstrates that such change is achievable. These countries have all achieved average annual growth rates in solar and wind power over a five-year period that exceed the necessary pace for global targets.

Uruguay has achieved remarkable success, generating up to 98% of its electricity from renewable sources. Initially focusing on wind power, Uruguay rapidly increased its capacity, reaching 40% in less than a decade. This was followed by expansion into solar and biomass, resulting in a nearly completely decarbonized energy mix. Within two decades, Uruguay transitioned from reliance on oil imports and carbon-emitting power generation to a renewable energy system owned by the state but funded by private investment. Now a net energy exporter, Uruguay supplies surplus power to Brazil and Argentina.

Similarly, Denmark, seeking to reduce its dependence on Russian gas, aims to quadruple its onshore wind and solar power generation by 2030. The North Sea also offers significant offshore wind potential, estimated at at least 35 GW. Denmark is pioneering the development of the world’s first energy island in the North Sea. At full capacity, this hub will provide clean energy from surrounding wind farms to power 10 million European households.

These are examples that have laid the groundwork for other nations to follow. But each have to chart their own path, overcoming barriers to achieving it.

Needs Work

To achieve a sustainable energy future and reach net-zero emissions by 2050, a global effort is crucial, requiring significant policy adjustments and financial commitments. Governments must prioritize inclusive energy policies, ensuring affordability and accessibility for all, especially vulnerable populations. This includes facilitating knowledge sharing and technology transfer by addressing barriers like intellectual property rights. Investing in research and development, particularly in battery storage technology, is vital. Effective storage solutions will enable the reliable use of renewable energy sources like solar and wind power, providing consistent and affordable electricity, even in remote and off-grid communities.

Reaching the 2050 net-zero target necessitates a massive investment in renewable energy, estimated at $4 trillion annually until 2030. This requires a concerted effort from global financial systems, including multilateral development banks and both public and private financial institutions. Domestic policy reforms are also essential to streamline renewable energy projects and attract private investment.

More impetus will also need to be diverted towards subsidizing renewables than fossil fuels. This transition will not only reduce emissions but also boost economies, create jobs, improve public health, and promote greater equality, especially for the world’s poorest and most vulnerable communities.

With strong political will and adaptable policies, nations with diverse circumstances can rapidly transition from a reliance on polluting energy sources to a sustainable energy model.

Photo Caption: Solar panels fitted on a terrace in Uruguay.