We all know that the world is undergoing an energy transformation, from a system based on fossil fuels to a system based on renewable energy,in order to reduce global greenhouse gas emissions and avoid the most serious impacts of a changing climate. This article however realistic it appears, could be understood as some sort of justification of the ineluctable surrender of the fossil fuel to its time penalty.
Jarand Rystad Jan 25, 2020
Existing fossil fuel power plants will play a pivotal role in enabling the full transition to a near-zero-carbon electricity system in many countries. How can such a surprising and perhaps counterintuitive conclusion be reached? The key word is intermittency, in reference to the wide fluctuations of energy supply associated with solar and wind. Even if these two sources are, to some degree, complementary (with more wind at night and during winter, complemented by more sun at daytime and during the summer), the combination still carries a high degree of intermittency.
In this analysis, we have used data from Germany from 2012 to 2019, and scaled this up to a near 100% renewable system – assuming that the total capacity will be 160 GW, or three times the average consumption. In this system, there will still be 28 days where solar and wind combined produce less than 30% of the consumption. This happens typically during high-pressure weather systems during the winter months from November to February.
Moreover, there will on average be two extreme periods per year, with up to three days in a row when sun and wind will deliver less than 10% of Germany’s total energy consumption. Even with adjustments to imports and consumption levels, the country would still need some 50 GW of power to avoid blackouts (with 72 hours at 50 GW equating to 3.6 TWh). Total water pumping capacity today is 7 GW over four hours or about 30 GWh. Assume this multiplies ten-fold by 2050, and assume that 45 million cars are battery electric vehicles with surplus capacity of 20 kWh each. This would deliver about 1.2 TWh in total, meaning the system would still need 2.4 TWh of power or a continuous load of 33 GW.
During these periods, restarting old gas-fired power plants could be an economically rational way to deliver the power needed to keep the nation running as usual. The carbon footprint of this would be small – probably less than the footprint associated with constructing gigantic battery facilities for those few extreme cases. Germany presently has 263 gas power plants, with a total capacity of 25 GW.
Thus, finding a way to maintain these plants for emergency back-up capacity could be an enabler for an energy future based around solar and wind power. Capacity pricing rather than price per kWh is probably one of the commercial changes needed. This is the same pricing model that most people also have for home internet services, and should thus not be too difficult to implement.
The 4th International Rain Enhancement Forum (IREF) that brought together leading experts, scientists and researchers from all over the world was held in Abu Dhabi this past week. It was about the latest research and innovation in rain enhancement science together with possible collaborations to address the challenge of global water stress. The Future direction of rain enhancement research reviewed was reported on by all local media.
Emirates News Agency (WAM) — 25 January 2020
The UAE Research Program for Rain Enhancement Science, UAEREP, hosted a workshop to update its solicitation document, which will define the future calls for research proposal submissions. The workshop built on the productive discussions that took place during the 4th International Rain Enhancement Forum and its various plenary sessions.
UAEREP organised the 4th International Rain Enhancement Forum from 19 to 21 January 2020 under the supervision of the National Center of Meteorology. The event convened prominent national and international experts, researchers, scientists, and stakeholders to highlight the latest scientific and technological advancements in rain enhancement.
The full-day event brought together leading scientists and experts in atmospheric research and technologies, and centered around two main themes: ‘Cloud to Ground Science: Identifying Knowledge Gaps’ and ‘New Approaches and Technologies for Rain Enhancement’.
The session opened with a welcome speech by Alya Al Mazroui, Director of UAEREP, who outlined the programme’s purpose and ambitions.
Alya Al Mazroui said: “This workshop follows the successful fourth edition of the International Rain Enhancement Forum and the productive discussions we had over the course of the three days of intensive sessions and the Town Hall Meeting. The workshop is crucially important for our call for new research proposals and the shaping of the future direction of UAEREP’s research objectives.”
She added: “As we move forward with our efforts to enhance collaboration and seek viable solutions for global water stress, it is essential to build stakeholder consensus around our research goals and priorities to ensure the relevance and quality of proposals for the future of the our research program.”
Al Mazroui also revealed that the content of the new solicitation document will be shared publicly in mid-2020 as part of the call for research proposal submissions for the Program’s 4th cycle starting in 2021.
Participants at the workshop were provided with a detailed overview of UAEREP’s previous solicitation and management plan and the workshop structure by Dr. Richard Behnke, chair of UAEREP’s international reviewers committee.
In his presentation, Dr. Deon Terblanche, Weather and Climate Consultant at World Bank and former Director of Research at the World Meteorological Organization (WMO), highlighted the achievements and challenges of past UAEREP awardees, and the latest advances in precipitation enhancement research.
Dr. Deon Terblanche also chaired a session titled ‘Cloud to Ground Science: Identifying Knowledge Gaps’, covering key topics such as quantifying the evaporative loss between cloud-base and the surface, improving areal precipitation estimation through a combination of remote sense and ground-based measurements, and translating seeding effects on single storms into areal effects. Panelists also discussed inter-cloud interactions in a convective environment, rainfall-runoff-groundwater relationship and the impact of cloud seeding and environmental and ecological changes due to long-term cloud seeding.
The workshop also facilitated productive discussions around ‘New Approaches and Technologies for Rain Enhancement’. Chaired by Dr. Steve Griffiths, Senior Vice President for Research and Development at Khalifa University, the session provided an insight into the technologies for observing physical phenomena, data modeling, analysis, and evaluation and experimental design, technologies, and instrumentation.
Summarising workshop outputs, Dr. Robert Robinson, co-chair of the committee, outlined the key takeaways and observations from the workshop participants.
The outcomes of the IREF town hall meeting, which took place on 21 January under the theme of “Determining Future Directions for Rain Enhancement Research”, provided important input for the discussions during the workshop, and for the shaping of the new UAEREP solicitation and the research proposal calls.
The top ten emitting countries accounting for most of all Climate change impacts in the world are at this conjecture outside the MENA region but use most certainly fossil fuels originating for most from the MENA region. Climate change is not high enough on the agenda of most countries of the MENA region or anywhere else. If the MENA countries governments are serious about tackling climate change that presents challenges for the oil-producing and water-stressed region, they must quickly adapt the Best Tool to Fight Climate Change as elaborated here by Jeffrey Frankel in this article. It would, in our view, be complemented through technological innovations in areas such as solar power. In any case, the MENA region needs to put aside the current apathy towards climate change that is relatively common across the region’s countries and respond to the present challenges for the oil-producing and the non-oil producing alike.
If they are serious about tackling climate change, governments must quickly establish the expectation that the price of carbon will follow a generally rising path in the future. Lofty statements from public officials and optimal calculations from climate modelers will not do the job.
AMSTERDAM – Although many supporters of US President Donald Trump seemingly believe that global warming is a hoax, almost everyone else agrees that climate change should be at the top of the list of important policy issues. Identifying the problem, however, is not much use unless we also identify the appropriate tools to address it.
To be sure, financial institutions must fundamentally rethink some things in the light of climate change. For example, a bank or insurance company calculating risks to real-estate loans would make a serious mistake if it followed the standard methodology and plugged into its formulas the probability of a flood based on data from the last 100 years. Instead, it should take a forward-looking approach, which means using estimates of the increasingly elevated probability of such disasters.
But central banks and international financial institutions simply lack the necessary tools to have first-, second-, or maybe even third-order effects on greenhouse-gas (GHG) emissions.
So, what policy tools would have first-order effects?
In the United States, the “Green New Deal” signals commitment to the climate cause. But I fear that the legislative proposal that its congressional supporters have introduced will do more harm than good. It includes extraneous measures such as a federal jobs guarantee. This proposal creates a factual basis for a lie that US climate-change deniers have long been telling: that global warming is a hoax promoted as an excuse to expand the size of government. That is a sure-fire way to generate votes for Trump in November.
Technological innovations in areas such as solar power certainly will play a big role in mitigation. But technology is not a policy. Subsidies are a policy. There is a case to be made that governments should subsidize research in climate science and relevant technologies. There is also a strong case that policymakers should allow free trade in solar panels, turbines, and other equipment, to lower the cost of generating renewable energy at no cost to domestic taxpayers.
But the policy that will move us closest to achieving global environmental targets, such as those in the Paris climate agreement, at relatively modest economic costs, is to raise the price of emitting carbon dioxide and other greenhouse gases. If, for example, solar power or other renewables can in fact meet most of our energy needs at a reasonable cost, then a high carbon price will encourage that result. And if some other technology or approach is needed, the carbon price will reveal that as well.
The price of carbon can be raised via one of two policies: a carbon tax or cap-and-trade, that is, a system of quantitative emission limits with tradable emission permits.
In theory, the two approaches are equivalent: the quantity of carbon permits is calculated carefully, so that the resulting price when they are traded is the same as the price that would be achieved by the tax. In the real world, however, there are significant differences between regulating prices and quantities. The most important differences relate to uncertainty and political economy.
For starters, it would be great if policymakers could commit to a century-long rising path for the carbon price. People could then plan far ahead. Firms would know with certainty the penalty for building long-lasting coal-fired power plants. But, even assuming a miraculous burst of multilateral cooperation, today’s leaders cannot bind their successors 50 years into the future, which rules out precise certainty about the future price or quantity of GHG emissions.
What is critical, though, is quickly to establish the expectation that the price of carbon will follow a generally rising path in the future. To achieve this, governments must start increasing the price today; lofty statements from public officials and optimal calculations from climate modelers will not do the job.
Predicting political economy, meanwhile, is extremely difficult. In the climate-change arena, everything is judged to be “politically impossible,” and was even before Trump. Even so, at the global level governments are probably more likely to agree to quantitative emissiontargets – as in the 1997 Kyoto Protocol and the 2015 Paris accord – than to a global carbon tax, which would be considered too severe an invasion of sovereignty.
When it comes to the national implementation of any global effort to limit CO2 emissions, however, I lean toward a carbon tax over tradable emission permits. Previous attempts to introduce emission permits, such as Europe’s Emissions Trading System, have revealed a tendency to mollify industry by issuing more permits than originally intended and giving too many to legacy firms. The logic of doing so is to “make them whole,” but this can result in windfall gains when the firms sell the permits.
In any case, putting the price of carbon on an upward path, whether via a carbon tax or cap-and-trade, is the right tool for the job.
Obviously, no single citizen can expect to solve the problem of climate change alone. But whereas some individual actions are mainly symbolic, others can have an effect that is at least proportionate to the number of citizens undertaking them.
For frustrated young people, one piece of advice is clear: while going to a Greta Thunberg-inspired demonstration is fine, registering and voting is critical. If Americans aged 18-24 were to turn out and vote in the same proportions as older age groups, Trump would almost certainly not be re-elected. With Trump gone, the US could rejoin the Paris agreement and adopt effective measures to combat global warming – and other governments would lose an excuse they currently have to delay action.
Jeffrey Frankel, Professor of Capital Formation and Growth at Harvard University, previously served as a member of President Bill Clinton’s Council of Economic Advisers. He is a research associate at the US National Bureau of Economic Research, where he is a member of the Business Cycle Dating Committee, the official US arbiter of recession and recovery. Jeffrey Frankel has been writing for PS since 2000 with 159 Commentaries.
Adelle Geronimo informs that despite all the hoo-hah in the Middle East, the UAE to accelerate space tech startups is no extraordinary youth employment programme. This follows the UAE launching in October 2018, its first satellite built entirely by Emirati engineers in the UAE and after sending an Emirati astronaut to the International Space Station. The UAE plans also to establish a self-sustaining habitable settlement on Mars by 2117.
The UAE Space Agency has announced its collaboration with the Abu Dhabi-based global innovation hub, Krypto Labs, to launch the UAE NewSpace Innovation Programme, which aims to maximise the growth of space technology start-ups with NewSpace, the rising private spaceflight industry.
The programme falls under the purview of the National Space Investment Promotion Plan, which aims to heighten the role of the space industry in contributing to the economy of the UAE.
It is also in line with an MoU signed between the UAE Space Agency and Krypto Labs, which aims to increase innovation and investment in the space sector, drive a diversified UAE economy, and promote awareness through specialised initiatives that support space technology entrepreneurship.
Dr. Mohammed Nasser Al Ahbabi, Director-General of the UAE Space Agency, said, “The UAE NewSpace Innovation Programme invites students, entrepreneurs and start-ups to share their ground-breaking ideas and transform them into viable commercial products. This supports developing space technology as part of the UAE’s private spaceflight NewSpace sector, which aims to make space more accessible, affordable and commercial.”
Selected applicants will take part in a three-month incubation programme at the headquarters of Krypto Labs in Abu Dhabi, with access to the hub’s facilities. They will also have access to the innovation hub’s local and global network of investors, be mentored by global space experts, and develop their skills in business creation, marketing, and sales, among others.
Applicants will also have the opportunity to secure funds to ensure their start-ups are prepared to enter the market.
Eligible applicants must present an innovative and original idea with a clear technical approach, which generates a feasible and scalable product. The teams must have at least one Emirati team member.
Dr. Saleh Al Hashemi, Managing Director of Krypto Labs, noted, “By supporting innovators and young entrepreneurs, we aim to foster a spirit of originality and zest within start-ups to solve global challenges that keep the UAE on the frontier of the innovation map and elevate its position as a leader for innovation-focused businesses.”
Indeed, per the above, USD 10 trillion of fossil fuel investment must be redirected towards energy transformation by 2030.
Abu Dhabi, United Arab Emirates, 12 January 2020 – The share of renewables in global power should more than double by 2030 to advance the global energy transformation, achieve sustainable development goals and a pathway to climate safety, according to the International Renewable Energy Agency (IRENA). Renewable electricity should supply 57 per cent of global power by the end of the decade, up from 26 per cent today.
A new booklet 10 Years: Progress to Action, published for the 10th annual Assembly of IRENA, charts recent global advances and outlines the measures still needed to scale up renewables. The Agency’s data shows that annual renewable energy investment needs to double from around USD 330 billion today, to close to USD 750 billion to deploy renewable energy at the speed required. Much of the needed investment can be met by redirecting planned fossil fuel investment. Close to USD 10 trillion of non-renewables related energy investments are planned to 2030, risking stranded assets and increasing the likelihood of exceeding the world’s 1.5 degree carbon budget this decade.
“We have entered the decade of renewable energy action, a period in which the energy system will transform at unparalleled speed,” said IRENA Director-General Francesco La Camera. “To ensure this happens, we must urgently address the need for stronger enabling policies and a significant increase in investment over the next 10 years. Renewables hold the key to sustainable development and should be central to energy and economic planning all over the world.”
“Renewable energy solutions are affordable, readily available and deployable at scale,” continued Mr La Camera. “To advance a low-carbon future, IRENA will further promote knowledge exchange, strengthen partnerships and work with all stakeholders, from private sector leaders to policymakers, to catalyse action on the ground. We know it is possible,” he concluded, “but we must all move faster.”
Additional investments bring significant external cost savings, including minimising significant losses caused by climate change as a result of inaction. Savings could amount to between USD 1.6 trillion and USD 3.7 trillion annually by 2030, three to seven times higher than investment costs for the energy transformation.
Falling technology costs continue to strengthen the case for renewable energy. IRENA points out that solar PV costs have fallen by almost 90 per cent over the last 10 years and onshore wind turbine prices have fallen by up half in that period. By the end of this decade, solar PV and wind costs may consistently outcompete traditional energy. The two technologies could cover over a third of global power needs.
Renewables can become a vital tool in closing the energy access gap, a key sustainable development goal. Off-grid renewables have emerged as a key solution to expand energy access and now deliver access to around 150 million people. IRENA data shows that 60 per cent of new electricity access can be met by renewables in the next decade with stand-alone and mini-grid systems providing the means for almost half of new access.
Despite regional turmoil, there are two critical areas of focus to work on simultaneously.
Despite 2020 looking to be a year of volatility, the President and CEO of the Atlantic Council expressed his optimism at the “remarkable” human potential of the MENA region.
In statements ahead of the fourth annual Global Energy Forum in Abu Dhabi, Frederick Kempe noted that despite regional turmoil, there are two critical areas of focus to work on simultaneously.
“One of them is to reduce conflict, to wind down the tensions of the region. But at the same time, you have to unlock the remarkable human potential of the Middle East and the GCC,” he said.
He told the Emirates News Agency (WAM), his predictions for 2020, noting that it would be a volatile year, particularly in the energy industry.
“Geopolitical uncertainty will play a larger role on energy prices this year,” Kempe added.
Reflecting on 2019 events, he noted, “It’s remarkable that energy prices have remained so low through everything we’ve gone through – Iranian sanctions, Libyan turmoil, Iraqi uncertainty.”
However, he added, “despite all that and partly because of the glut of oil we’ve had on the market, and the US oil and gas production, we’ve kept prices remarkably stable for a long period of time.”
“I think the big question is can that hold out in 2020,” he continued.
“You see prices rise by four percent when you get into a crisis, suddenly it seems as we’re in a de-escalatory phase if prices drop by five percent, and I think that’s what we’re going to see.”
Commenting on recent US-Iran tensions, and their impact on clean energy transitions, Kempe said, “A lot of people are focusing on the wrong lessons from the last few days. No doubt, there’s been a lot of tension.
“No doubt there was, for a period of time, increased risk of violent conflict. On the other hand, both parties stood back from that,” he added.
“No one in the region wants an escalation of the current tensions,” he stressed, adding, “Everyone that participated in de-escalating came to that. I think that’s promising.”
“I think all parties see no gain in war. The US doesn’t see any gain, Iran doesn’t see any gain; certainly, the Arab and GCC countries don’t see any gain,” the Atlantic Council President emphasised.
When asked to comment on how GCC countries, like the UAE, can play a role in the 2020 energy agenda, Kempe said, “If you look at the GDP of this region, and if you took the size of the Middle East population and put it anywhere in the world, you would have three times the GDP.”
World Bank figures indicate the GDP figures for the Middle East and North Africa reached $3.611 trillion in 2018.
“So imagine how much low-hanging fruit there is here and how much opportunity there is,” he said.
According to the International Renewable Energy Agency, IRENA, figures, the adoption of renewable energy technologies created 11 million new jobs at the end of 2018.
When asked to comment on how countries and international bodies can partner further to see effective climate action, Kempe revealed that through the Council’s Adrienne Arsht Centre for Resilience, the MidEast Centre, and the Rockefeller Foundation, a new initiative will see one billion individuals become resilient to climate change, tensions and crises.
More details on the announcement will be made as part of Abu Dhabi Sustainability Week 2020 next week.
The Atlantic Council Global Energy Forum is an international gathering of government, industry, and thought leaders to set the energy agenda for the year.
Taking place in the UAE capital from January 10-12, the 2020 iteration of the forum will focus on three key themes: the role of the oil and gas industry in the energy transition, financing the future of energy and interconnections in a new era of geopolitics.
Today, 8 January 2020, it appears that the US is more relaxed about oil spike than Europe – which helps explain differences over Iran, according to Mueid Al Raee, of United Nations University.
Oil prices shot up following the US assassination of Iranian general Qassem Soleimani, rising more than US$5 per barrel to more than US$71 (£54) on January 6, its highest level since the Saudi oil refinery attack last September. Brent crude has since eased to around US$69 at the time of writing, though there is much discussion that it could climb a lot higher if the current crisis leads to an all-out war.
In keeping with many recent developments in US-Iranian relations, the Europeans have taken a dim view of America’s decision to take out the military commander. When trying to make sense of the very different approaches Iran on either side of the Atlantic, one factor that is often overlooked is that the US and Europe are affected in different ways by a rising oil price.
People tend to see more expensive oil as bad news for the global economy, but the reality is that it’s not necessarily bad for America. It may be that, in continuing to provoke Iran, driving up the oil price is almost seen by the Americans as an added incentive.
The complex oil effect
Oil pricing and its associated effects are often more complex than portrayed. As citizens, we are most often concerned with the price of fuel for our cars and the cost of heating our homes. This is the first way that oil prices affect the broader economy: if consumers have to spend more on fuel and associated taxes, they have less to spend elsewhere – and this can lead to a global slowdown.
Like all countries, the US is affected by this. Yet on previous occasions where US actions on the geopolitical stage drove up oil prices, there were also benefits to the country’s economy. Take the 2003 invasion of Iraq, which ushered in a period that would see the price of Brent nearly triple by the end of the decade. This led to a wave of investment into the US shale oil sector, which would eventually account for approaching two-thirds of the country’s total oil production.
Brent crude price, 1940s to present day
The trouble with shale oil is that it is expensive to produce, with average break-even of fields not far below US$50 per barrel. Shale oil wells also produce most of their oil in the first year of production, which means that producers have to continually drill new wells.
Due to the lower prices of the last few years, a large number of oil-related companies in the US have filed for bankruptcy, including both producers and services businesses. And while US production of shale oil managed to continue rising impressively throughout this period, mainly thanks to the bigger producers, it has been slowing down markedly in recent months.
If the oil price now trends higher, it could well mean that shale oil production in the US can resume its upward march. It also raises the prospect of US oil services companies earning more both locally but, most importantly, from foreign oil-production ventures, since there is a well-established correlation between their stock price and higher oil prices.
At the same time, six of the last eight recessions in the US were followed by high oil prices. One reason why this was not a hindrance for the economy is that, in the longer term, stable higher prices promoted the development of more energy-efficient technologies within the country.
The Americans can also argue that there are some longer-term economic benefits to higher oil prices that can help everyone. Oil-producing countries with surplus cash from oil profits invest in foreign technology and foreign assets. At the same time, oil-importing countries innovate to mitigate the profit-reducing effects of higher oil prices. These are both ultimately good for economic vibrancy and growth.
On the other hand, there are advantages to cheaper oil that are particularly important to countries in Europe – including the UK – because, unlike America, they are not oil self-reliant. Lower oil prices are shown to be beneficial for Europe’s highly energy-intensive economies and are expected to help with job creation. During the oil price drops of 1986 and the early 1990s, for instance, energy-intensive industries in Europe increased their earnings. Consumer product businesses and European airlines benefit from lower oil prices, too.
What happens next
Whether or not the Americans actually want higher oil prices, there are certainly good economic reasons why they probably won’t mind them. Deepening the chaos that started with the US withdrawing from the West’s nuclear deal with Iran is an “easy” way to achieve higher oil prices while meeting other strategic objectives.
Yet how the Europeans, China and Russia respond will also determine the global flow of oil from Iran and Iraq. Whatever the ultimate pros and cons of a higher oil price from an economic point of view, the Europeans clearly have more reasons to be unenthusiastic than the US. If the new exchange and payment instruments that have been developed by Europe to circumvent US sanctions are effective, and the US does not escalate the conflict, it may yet mean that oil prices remain stable at current levels.
Kuwait has issued a global tender to seek international experts for a major project to help diversify the economy.
Kuwait has issued a global tender looking to companies to help develop a new Entertainment City in the country.
The mega-scale tender seeks to locate the right partners to undertake planning, development, execution, operation, maintenance and investment in the project which forms part of Kuwait Vision 2035.
Al-Diwan Al-Amiri said in a statement that it aims to sign up partners “at the nearest possible opportunity”.
Considered to be one of the largest projects of its kind in the region, the mega project will actively support the ongoing efforts by the government to diversify sources of income and will contribute to the revitalisation of the cultural, leisure and tourism sectors in Kuwait, the statement added.
As part of the project, a global entertainment and tourism city will be established, featuring an amusement park and a world-class integrated entertainment complex.
Project components primarily include a ride based outdoor theme park, an indoor theme park, an aqua park, a kids’ activity and entertainment centre, in addition to gaming arcade, a snow/ski park and a multiplex and open air theatre.
Other components comprise a sports centre, a museum, public parks and social entertainment areas with landscaped areas and trails. The project also comprises 4 and 5 star villas, apartments, a retail mall, commercial areas and restaurants. It also includes an observatory, an amphitheatre, indoor water channels.
The current location for Al-Diwan Al-Amiri’s Entertainment City in the Doha region in the north of Kuwait will be expanded and developed to cover 2,750 million square metres.
The deadline for the global tendering and bidding process is set for February 27.
Al-Diwan Al-Amiri’s other projects include the Jahra Medical City, Sheikh Jaber Al-Ahmad Cultural Centre, Sheikh Abdullah Al-Salem Cultural Centre, Kuwait Motor Town and Shaheed Park.
A Frenchman is credited with being the first to discover the photovoltaic effect that produces electricity from sunlight. The first solar panel was built in the US. But when Abu Dhabi decided to build the world’s largest individual solar power project, they looked east for help.
The country partnered with Chinese and Japanese companies to construct a facility, which opened this year, with a peak capacity of 1.18 gigawatts generated by 3.2 million solar panels. That’s because Asia, more than any other region on the planet, and China, more than any other nation, currently represent the future of solar energy, and are at the heart of the ensuing industrywide transformation from fossil fuels to renewable and nuclear energy.
Decarbonization is changing the face of energy and the world economy in more ways than most consumers — and even most executives — appreciate. Besides the transition from molecule to electron, as this move toward electrification suggests, it is also shifting the industry’s economic base from West to East and reconfiguring the hierarchy of companies and geographies that define energy.
Asia is the 800-pound gorilla in the energy story. First, its continued economic growth and rising standard of living will make its constituent nations pre-eminent energy consumers for the foreseeable future. A study by BP indicates that Asia, including China and India, will represent 43% of global energy demand by 2040, and through that year, the region will account for more than 50% of the growth in demand. In contrast, energy demand among the 36 nations in the OECD, which includes most big economies in the Americas and Europe, will be flat.
China’s sunny outlook
Second, places like China are already among the most important suppliers of non-fossil fuel-based energy and technology. By 2017, China owned 72% of the world’s solar photovoltaic module production; in comparison, the US has 1% and Europe 2%. Of the eight top producers, six are Asian. Not including hydropower, China has somewhere around one-third of the world’s installed renewable capacity; the EU has a little over a quarter; and the US accounts for 14%. China also leads in the generation of hydropower.
As the electrification of transportation advances and demand grows for renewable energy storage solutions, China looks likely to monopolize here, too. China produces at least two-thirds of the world’s production capacity for lithium-ion batteries, which are used in electric vehicles (EVs), mobile phones and laptop computers (some estimates put their share at closer to 70%), and it looks likely to hang on to that lead through at least 2028. And besides being the largest market for EVs, China also controls the bulk of production.
China is the third-largest miner of the primary raw material used to produce those batteries, lithium — often referred to as white petroleum because of its mounting economic importance. Chinese producers are also buying up lithium reserves in Chile, the world’s second-largest lithium miner (Australia takes the top spot).
A fundamental overhaul
Of course, climate change is forcing the energy industry to undergo an existential transformation that may eventually see the elimination of fossil fuels entirely. While most executives at oil companies will be dead or at least retired before that transition proceeds to what seems its inevitable end, the slowing of demand is already being felt.
By contrast, the demand for electricity seems insatiable. Electrification rates continue to rise across the globe, with Asia expected to be close to 100% coverage by 2030. Much of that growth in demand may be supplied by renewables and nuclear power rather than fossil fuel-generated power, although natural gas is expected to play a role for years to come. It also may be accomplished through a decentralization of generating capacity, such as recent rural electrification projects in places like Malawi and Bangladesh where farmers and villages use solar panels and small generators to provide their own electricity.
What’s the World Economic Forum doing about the transition to clean energy?
Moving to clean energy is key to combatting climate change, yet in the past five years, the energy transition has stagnated. Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago.
Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.
Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.
Yet despite the urgency of climate concerns and the rapidly falling cost of renewable energy, the speed at which this existential energy transition will happen is uncertain, as pre- and post-tax subsidies on fossil fuels remain in place, discouraging consumers to make the change to a more environmentally beneficial and frequently cheaper source of energy. The International Monetary Fund estimates post-tax subsidies on fossil fuels like coal and petroleum — a result of unpriced externalities, such as societal costs from air pollution and global warming — totalled $5.2 trillion in 2017.
Regardless of the speed of transformation, there’s no doubt it is already well underway. That’s why places like the United Arab Emirates (of which Abu Dhabi is the largest) are building solar power and nuclear facilities, despite being the world’s eighth-largest oil producer — and making the transition with Asian partners. They see the future.
The first two decades of the 21st century saw the return of mass movements to streets around the world. Partly a product of sinking confidence in mainstream politics, mass mobilisation has had a huge impact on both official politics and wider society, and protest has become the form of political expression to which millions of people turn.
Following moments of open class warfare in the late 1960s and early 1970s, battles against the political and economic order became fragmented, trade unions were attacked, the legacy of the anti-colonial struggles was eroded and the history of the period was recast by the establishment to undermine its potency. In the post-Cold War era, a new phase of protest finally began to overcome these defeats.
This revival of protest exploded onto the political scene most visibly in Seattle outside the World Trade Organization summit in 1999. If 1968 was one of the high points of radical struggle in the 20th century, protest in the early 2000s once again began to reflect a general critique of the capitalist system, with solidarity forged across different sections of society.
The birth of the anti-globalisation movement in Seattle was followed by extraordinary mobilisations outside gatherings of the global economic elite. Alternative spaces were also created for the global justice movement to connect, most notably the World Social Forums (WSFs), starting with Porto Alegre, Brazil in 2001. It was here that questions over what position the anti-globalisation movement should take over the Iraq War, for example, were discussed and debated. Though the WSFs provided an important rallying point for a time, they ultimately evaded politics.
In the years leading up to and following the banking crisis of 2008, food riots and anti-austerity protests escalated around the world. In parts of the Middle East and North Africa, protests achieved insurrectionary proportions, with the overthrow of one dictator after another. After the Arab Spring was thwarted by counter-revolution, the Occupy movement and then Black Lives Matter gained global attention. While the public, urban square became a central focus for protest, social media became an important – but by no means exclusive – organising tool.
To varying degrees, these movements sharply raised the question of political transformation but didn’t find new ways of institutionalising popular power. The result was that in a number of situations, protest movements fell back on widely distrusted parliamentary processes to try and pursue their political aims. The results of this parliamentary turn have not been impressive.
Crisis of representation
On the one hand, the first two decades of the 21st century have seen soaring inequality, accompanied by debt and the neglect of working people. On the other, there have been poor results from purely parliamentary attempts to challenge it. There is, in other words, a deep crisis of representation.
The inability of modern capitalism to deliver more than survival for many has combined with a general critique of neoliberal capitalism to create a situation in which wider and wider sections of society are being drawn into protest. More than a million people have poured onto the streets of Lebanon since mid-October and protests continue despite a violent crackdown by security forces.
At the same time, people are less and less willing to accept unrepresentative politicians – and this is likely to continue in the future. From Lebanon and Iraq to Chile and Hong Kong, mass mobilisations continue despite resignations and concessions.
In Britain, the Labour Party’s defeat in the recent general election is attributed largely to its failure to accept the 2016 referendum result over EU membership. Decades of loyalty to the Labour Party for many and a socialist leader in Jeremy Corbyn calling for an end to austerity couldn’t cut through to enough of the millions who voted for Brexit.
In France, a general strike in December 2019 over President Emmanuel Macron’s proposed pension reforms has revealed the extent of opposition that people feel towards his government. This comes barely a year after the start of the Yellow Vest movement, in which people have protested against fuel price hikes and the precariousness of their lives.
The tendency towards street protest will be encouraged too by the climate crisis, whose effects mean that the most heavily exploited, including along race and gender lines, have the most to lose. When the protests in Lebanon broke out, they were taking place alongside rampant wildfires.
As protesters gain experience, they consciously bring to the fore questions of leadership and organisation. In Lebanon and Iraq, there has already been a conscious effort to overcome traditional sectarian divides. Debates are also raging in protest movements from Algeria to Chile about how to fuse economic and political demands in a more strategic manner. The goal is to make political and economic demands inseparable, such that it’s impossible for a government to make political concessions without making economic ones too.
There has also been a resurgence of the far-right in many countries, emboldened most visibly by parties and politicians in the US, Brazil, India and many parts of Europe. This resurgence, however, has not gone unchallenged.
The convergence of crisis on these multiple fronts will reach breaking point, creating conditions that will become intolerable for most people. This will galvanise more protest and more polarisation. As governments respond with reforms, such measures on their own will be unlikely to meet the combination of political and economic demands. The question of how to create new vehicles of representation to assert popular control over the economy will keep emerging. The fortunes of popular protest may well depend on whether the collective leadership of the movements can provide answers to it.
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