The ABC of the Energy Transition: Part 2

May 06, 2024

Thing you didn't know you didn't know

The energy transition is perhaps among the most difficult and, at the same time, most important tasks humanity has ever had to face. Experts unanimously agree that we are running out of time and that this extremely challenging task can only be tackled in a joint global effort. In these ABCs of the energy transition, Jonas Puck, Academic Director of the Executive MBA Energy Management at the WU Executive Academy, debunks the most common myths about the energy transition and expounds on background facts about little known correlations in a field that will shape our planet’s future more than anything else.

ABC of Energy Transition
Part 2 of the ABC of energy transition. All images in this article created in ChatGPT with DALL E
Energy Transition ABC: M

ABC of the Energy Transition: Maritime Momentum

Energy harnessed from the oceans and seas could make a considerable contribution to enabling the energy transition. Considering the enormous energetic momentum of water, it’s clear that wave or ocean thermal energy converters and tidal power plants harbor a potential for the sustainable generation of electricity. Having said that, the respective technologies are still in their infancy, and numerous environmental protection issues are yet to be solved. This concerns, for instance, the effects of such plants on the flora and fauna as much as on the local population and regional tourism.

Another unsolved issue is the fact that energy is produced where it is not needed. So how to transport it from the seas to the end user without losing too much of it on the way? And still: we should definitely keep an eye out for future uses of energy generated by the oceans and seas.

Energy Transition ABC: N

ABC of the Energy Transition: Net-Zero Navigations

To curb global warming, the global economy must reach net zero emissions fast. This is a monumental task requiring drastic measures across all industries. The former goal of containing global warming to a plus of 1.5°C compared to pre-industrial levels has effectively become unrealistic as almost every country lags behind in reaching its climate goals.

The specter of rising energy prices drastically affecting prosperity and competitiveness – something particularly companies fear – does not help either. But not all manufacturing enterprises need to worry. With the exception of players in the energy-intensive steel and cement industries, the energy costs of an average producing company amount to only one to three percent of its overall expenses.

Energy Transition ABC: O

ABC of the Energy Transition: Oil Oxymoron

You would think that soaring oil prices would prompt consumers to switch to renewable energy sources. That’s partly true because when prices are high, people look for alternative and cheaper energy sources to save money.

But that’s only one side of the story. Oil and gas corporations are major investors in renewables as they too are forced to develop new business models in the long run. As long as they make enough money from oil and gas sales though, they tend to hold back on investments or scale them down. So even if the current prices seem like a strong incentive to move away from fossil fuels, the pace of the transition to renewable energy sources is much slower than one would expect.

Energy Transition ABC: P

ABC of the Energy Transition: Plastic Pollution

The production and disposal of plastics both considerably contribute to driving climate change. Plastic causes greenhouse gas pollution across its entire life cycle. in the production of the raw material oil it is derived from, its actual production and transport, and when it is not properly recycled and ends up on landfills (methane) or is burned (CO2 and other harmful substances). Reusing and recycling plastics could, reduce pollution, but the effects are still quite limited.

And the fact that standards of and approaches to handling used plastics vary greatly across the world only exacerbates the situation. While EU countries recycle, on average, just over 42% of their plastics waste, this number is as low as 9% in the US. Countries in Africa and Asia fare even worse as they have little to no infrastructure to manage their waste.

Energy Transition ABC: Q

ABC of the Energy Transition: Quota Quandaries

It’s basic math: a quota and the absolute sum can differ significantly, and one can often not be interpreted without the other. And the same goes for depicting the share of fossil fuels in an overall portfolio. If a country proudly states that the quota of fossil energy sources in its energy portfolio has dropped by 15%, this does not necessarily mean that the total sum of energy from fossil sources used has decreased. In fact, the reduced share of fossil energy is often associated with significantly increased total energy consumption, particularly in growth regions.

So what sounds like good news at first, alas, sometimes simply means that the CO2 pollution has decreased in an insignificant way, or maybe not at all.

Energy Transition ABC: R

ABC of the Energy Transition: Rebound Reaction

It’s a phenomenon as old as Thomas Edison’s invention of the light bulb. Already back then, people turned it on more often than necessary. Efficiency increases usually make things cheaper for consumers. This leads to what has been termed the “rebound effect”. When a cheaper energy source that enables people to save energy and money becomes available, people often end up using more, effectively offsetting their savings. A simple example: you buy a car with outstanding mileage and use it for every short trip, such as the 5-minute drive to the supermarket. This phenomenon can also be observed on the macroeconomic level. If the energy-conscious behavior of one group of consumers results in a drop in energy prices, this can lead to increased consumption by another group of consumers.

There are also indirect rebound effects, such as when money saved by increased energy efficiency is spent on energy-intensive fields. The rebound reaction also comes into play in the development of products. Flat-screen televisions are more energy-efficient than CRT televisions. However, as people are buying ever larger screens, energy consumption through TV use is still increasing every year.

Energy Transition ABC: S

ABC of the Energy Transition: Storage Struggles

For gas and nuclear power plants, the energy output can be controlled. When it comes to wind, water, and solar energy this becomes difficult. When the weather is stormy but sunny, power plants feed massive amounts of electricity into grids, causing electricity prices to become negative and threatening the entire system. What’s paradoxical about this is that the grid operator is then forced to pay the consumers to get rid of excess electricity.

When it’s very windy in Germany for example, windmills produce additional electricity that Germany has to pay, e.g., Austria to accept the surplus that would overburden the stability of their grid. Austria feeds this electricity into pumped-storage power plants, which pump water into mountain water reservoirs to store energy. When more electricity is needed in Austria, this water is released again. In the future, it will be a challenge to develop ways to efficiently store energy.

Energy Transition ABC: T

ABC of the Energy Transition: Tipping Point Tragedy

The climate system’s tipping points are no longer the hobbyhorse of climate experts. They have also entered public discourse. And for a good reason! Even though the Intergovernmental Panel on Climate Change (IPCC) emphasizes that, contrary to common belief, tipping points are not actually points at which the climate would “tip” irreversibly, they are still something to worry about. When they are reached, the (climate) system changes its nature entirely. They are abrupt climate effects that rapidly change for the worse and are sometimes, but not always, irreversible.

And they often trigger a chain reaction. One tipping point sets off the next one. If one sub-system is destroyed, this affects further sub-systems. The weakening of the Atlantic meridional overturning circulation (AMOC), melting polar ice caps, and thawing permafrost are only some examples of such tipping points.

Energy Transition ABC: U

ABC of the Energy Transition: Urbanization Utopia

Urbanization is both an opportunity and a threat for climate protection. Cities cause the most emissions, but they can also pioneer the changes needed for the energy transition. Just think of green buildings and efficient infrastructure and sustainable mobility offers such as bike or car sharing. Usually, however, green lungs and recreational parks are located at the outskirts of cities.

The notion of keeping things regional, which will be an important requirement for the energy transition to succeed, plays a particular role in cities. Sustainable farming to produce the food needed for a big city like Vienna takes place outside the city’s borders. This means that urbanization will only be a stepping stone to a zero-emissions future if we find ways to ensure regional (food) provision in urbanized areas. And it is also why innovative approaches with the potential of becoming real game changers will be so important.

Energy Transition ABC: V

ABC of the Energy Transition: Vivid Visions of Birdkill

In many regions of the world, renewable energy portfolios rely heavily on the contribution of wind farms. At the same time, there are ecological and social aspects about them that have gotten animal lovers all riled up. In Germany, the threat these power plants supposedly pose to birds constantly makes headlines. Apparently, a shocking number of songbirds find their death through a collision with wind turbines.

Many people feel strongly about this topic, but actual research paints a different picture. Even if a wind turbine would be built in every suitable spot across Germany (which would increase the number of the country’s windmills by about 90%), the number of birds killed in collisions with rotor blades would only come to 1% of the birds falling prey to pet cats every year. While all beings are precious and deserve protection, the extent of birdkill is often exaggerated.

Energy Transition ABC: W

ABC of the Energy Transition:Willing to Win Elections

One of the biggest challenges for the energy transition can be traced back to the political election mechanisms that prevail in most (democratic) countries. Politicians do not always make decisions based on what’s best for everything and everyone involved (people, the environment, etc.) but act with upcoming elections and garnering votes for themselves in mind. This also explains why so many measures are implemented that are clearly the worst of all possible options in the long term.

Add to that the fact that, especially with issues such as the energy transition, the impact of decisions can only be felt many years later. Populist systems, where people often have little to no information or are prevented from checking whether claims made are actually correct, are a particular hazard. And this is why education and independent media will have to play a vital role as we transition to a zero-carbon future.

Energy Transition ABC: X

ABC of the Energy Transition: X-treme X Factor

The X factor represents everything we cannot anticipate and plan for on our way toward a transformation of the energy sector. It stands for all the unpredictable events, developments, and technologies that can have an impact on how things pan out. Often, these things are negative in nature (particularly at first sight). Just think of the catastrophe in Fukushima, which changed public sentiment about the use of nuclear power, especially in Europe. Or the war in Ukraine, which has ruined all the progress made in terms of a nuke-free future and even incited a kind of renaissance of nuclear power plants.

But also, happy events can be disruptive in a positive sense. Think of ground-breaking (r)evolutions such as energy storage solutions requiring far less resources than in the past, which have the potential to change framework conditions from the ground up in a very short amount of time.

Energy Transition ABC: Y

ABC of the Energy Transition: Yes, to Youth Empowerment

Fridays for Future has impressively shown how empowering the youth can make a real difference in the fight against climate change. Many of us are not (yet) too worried about rising temperatures because for now, we do not (yet) or only rarely feel the immediate consequences. For future generations, however, this will be a whole different story.

This is why it’s important to raise special awareness of this topic particularly among young people. They are not only the leaders of the future but if they join forces, they have the power to convince decision-makers that there is no topic more urgent than the energy transition already today. And again, education will play a crucial role in building awareness, both among younger and older people.

Energy Transition ABC: Z

ABC of the Energy Transition: Zero-Emissions Science Zigzag

Science and research will have to play a major role in discovering and developing solutions to combat climate change and realize the energy transition. This includes technological innovations as much as probing social, economic, and political aspects. Many experts agree that science has been instrumental in improving the efficiency of renewable energy sources and storing energy. Others, however, keep repeating that research must do so much more. Particularly where the development and marketing of further alternative energy solutions are concerned, there is still a lot of room for improvement. But it would be unfair to put all the responsibility entirely on researchers’ shoulders. Also, politics and companies can make important contributions to the energy transition, for instance by earmarking additional investments in their annual R&D budgets to be used for innovations related to the energy transition.

MYou can read more about the energy transition and paths to renewable energy in the first part of our big energy transition ABC.

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