Europe Accelerates Clean Energy Transition Due to Ukraine Invasion
The suspension of the Nord Stream 2 gas pipeline between Russia and Germany is just the start of a much larger new energy strategy that Europe is accelerating in light of Russia’s unprovoked invasion of Ukraine . It’s a pivot from Russian gas dependence to renewable energy that European leaders have been talking about for many years, since the 1990s.
“Europe should be independent of its gas imports and it has the opportunity to be,” said Sandrine Dixson, co-president of the Club of Rome and ambassador of the Commission for the energy transition and one of the co-authors of a 1990s directive on clean fuels. . “We immediately need to look at where we can optimize our energy system. Where can we guarantee efficiencies? How can we start looking at supportive policies…ensuring that they protect those citizens who will be most at risk? »
Russia currently provides 40% of Europe’s energy, but a new European Union strategy will be unveiled around March 1st demands that this be reduced by 40% by 2030 – that is to say in eight short years. It forces European energy companies to store as much natural gas as they can now to need less Russian gas next winter, and will speed up the approval of renewable energy projects.
Better late than never
“Europe hasn’t invested in the infrastructure it should have to really allow renewables to develop,” Dixson insisted, referring to previously presented plans to avoid this kind of gas crisis. “We made it clear that energy efficiency first, then we had to triple investment in renewables and we put the targets in place.” She said they should have moved away from their reliance on gas “when we had the last gas crisis and the Ukraine crisis”, likely referring to Russia’s annexation of Crimea.
Dixson suggested that fossil fuel subsidies be stopped and moved to stimulate a clean energy economy. The Energy Transition Commission is releasing an analysis next week that includes this, it said, which also “looks at the long-term role of storage, how we design incentives for renewables, (and) the fact that we need new retail market structures, which protect consumers from marginal price volatility.
“We presented so many reports during the first energy-climate package where we made it clear that, for example, if we got the building directives in place across Europe, by 2030 we would be weaned at 100 % of Russian gas, and yet here we are,” Dixson lamented. “We take it for granted that gas will continue to be on the market, and that’s the real problem. Europe should be independent of its gas imports and it has the possibility of being so… We must consider a total change in our infrastructures.
Climate change and geopolitics
Various European countries and the EU have drawn up a series of strategies to tackle climate change, some of which were announced at the United Nations Climate Conference known as COP26 last November. These include announcements to reduce methane and one to reduce deforestation made by President Biden and British Prime Minister Boris Johnson during a panel hosted by Dixson. For example, Germany approved $68 billion for climate and green infrastructure investments last December.
Many leaders recognize that Europe would be in a much better position today – especially in light of Russia’s attack on Ukraine on top of already high energy prices – if they were away from Russian gas years ago, but some European decision-makers who have been on the fence would have needed the current crisis to convince them to act now. A new analysis from the Institute for Energy Economics and Financial Analysis (IEEFA) has found that European policymakers have focused too much on building gas infrastructure rather than diversifying energy sources. But they are intensifying now.
Italy is raising corporate taxes on energy companies and Spain is approving a utility tax, Dixson said, adding that some countries are putting policies in place to protect consumers from high electricity bills.
European policymakers, including Dixson, concede that it will take time to build renewable energy infrastructure and that gas will be needed in the transition, as well as nuclear.
Dixson insisted, “We just need system thinkers. And we need to stop having these short-term knee-jerk reactions to geopolitics and how we transition to low-carbon energy. We cannot continue to operate like this. We need to have the right infrastructure in place. We need to think about what that looks like. We need to have the right capital flows. We need to send the right signals to the public sector and to the private sector in terms of investment. »
The new European energy strategy and the recommendations of the Energy Transitions Committee next week will reveal how serious they are for accelerating this global transition. Maybe it will provide guidance in the US as well.
This could be one of the biggest unintended consequences of Vladimir Putin’s invasion, and one that will backfire on him and Russia economically and politically for years, probably decades to come – but it will benefit the planet in the process. .