The energy transition is a pathway toward transformation of the global energy sector from fossil-based to zero-carbon by the second half of this century. At its heart is the need to reduce energy-related CO2 emissions to limit climate change. Decarbonisation of the energy sector requires urgent action on a global scale, and while a global energy transition is underway, further action is needed to reduce carbon emissions and mitigate the effects of climate change. Renewable power and energy efficiency measures can potentially achieve 90% of the required carbon reductions.
The energy transition will be enabled by information technology, smart technology, policy frameworks and market instruments. IRENA has assessed decarbonisation pathways through REmap, and is also equipped to back up and accelerate the vitality transition through providing the necessary knowledge, tools and support to Member countries since they raise the share of renewable energy inside their power sectors.
The Energy Transition Netherlands has numerous dimensions. The ubiquity of energy in modern industry and society will ensure that the impacts are felt across the global economy. Policymakers have a chance to pursue pathways that effectively channel the transition to provide a future energy system that is certainly secure, sustainable, affordable and inclusive. A powerful enabling framework and multi-stakeholder collaboration are key for the effective energy transition.
There are several universal drivers for energy transition, which turn it into a concern for all countries to actively investigate their priorities:
Demand and provide shifts: Global energy consumption is predicted to increase by 30 percent from 2017 to 2040. This growth is driven primarily by non-OECD countries, because they move nearer to universal use of energy and consume more energy to back up economic and industrial growth, so when western world decouple energy consumption and GDP. Additionally, the near future demand also will be met by a more diversified primary energy fuel portfolio, driven from the gradual replacement of coal in power generation by renewable energy sources and natural gas, by reduced interest in liquid hydrocarbons because of electrification of transport, and by increased prioritization of national energy security and import independence.
Innovation: Innovation has become a constant companion from the energy system, ushering previous transitions from biomass to coal, and subsequently from coal to liquid hydrocarbons. While previous transitions were gradual processes, the power sector is looking forward to a dynamic future. Recent trends in technical maturity and cost reductions in solar photovoltaics, onshore and offshore wind, battery storage and unconventional fuel extraction fundamentally have altered the worldwide energy balance. Moreover, technologies like smart grids, demand response and blockchain will start new frontiers for the future energy system by changing the relationship between consumers and suppliers.
These new energy market participants demand new set of skills, highlighting the requirement for human capital development.
Environmental concerns: The power system contributes two-thirds of global greenhouse gas emissions. The necessity to act has materialized in landmark international cooperation (as in the Paris agreement) and national renewable energy targets in countries such as India and China. Private sector organizations have stepped up their responses: the Norwegian sovereign wealth fund announced divestment from coal-based assets, while oil and gas majors have raised stakes in alternative energy and Swiss Re is implementing ESG benchmarks across its entire $130 billion investment portfolio.
However, progress on environmental sustainability is slow, since the carbon intensity of the worldwide energy system remains flat, while air pollution has worsened in lots of countries and two-thirds from the world’s energy consumption is not subjected to efficiency interventions. Moving forward, as countries work to satisfy increased demand, environmental concerns will intensify vaaelo implications for energy system reliability and fuel diversity planning.
Driven by these trends, the energy transition is well underway, and there are significant opportunities for countries to boost the performance with their energy systems.
Policy decisions made today determines whether or not the energy system of the future can do delivering across its three key imperatives: economic growth and development; energy security and universal access; and environmental sustainability. The challenges within the current system are largely because of path dependencies from historical over-(or under-)prioritization of one of these three key imperatives. Consumption patterns and sunk investments represent significant socioeconomic lock-in, adding to the device inertia.