Electricity, gas, energy, renewable energy. What’s next for the energy transformation?

Today we are in a situation where coal is triumphant again. Electricity generated from coal is growing and heading towards a new annual record in 2021, undermining efforts to reduce greenhouse gas emissions to date, warns the International Energy Agency (IEA). After a decline in 2019 and 2020, it is estimated that global energy production from coal will increase this year by 9%, to 10,400. TWh.

Too 2022 will bring another consumption recordwhich may last for another two years. The IEA stresses the need for swift political action to prevent such a scenario. Renewable capacities must grow at an even faster pace. The role of the governments of individual countries will be of key importance, which should aim at increasing the capacity of renewable energy sources, including by removing bureaucratic barriers, by using various types of incentives and facilitations, and by promoting the wider use of renewable energy in various sectors.

More than half of the world’s electricity production from coal takes place in China. It is estimated that it will increase by 9% this year in the Middle Kingdom, despite a slowdown at the end of the year. In India, an increase of 12 percent is forecasted. If these figures were to be true, we would be dealing with all-time records in both countries. This is despite the fact that they introduce very large amounts of solar and wind energy into the system at the same time.

The production of energy from coal in the United States and the European Union is expected to increase by almost 20% in 2021, but will not exceed 2019 levels. In these two markets, coal consumption in 2022 should decrease, e.g. due to the rapid development of renewable energy.

In Poland, 80 percent. the energy produced this year came from coal. Such data was provided by the Energy Regulatory Office on the occasion of the publication of new tariffs for the new year. Meanwhile, last year it was below 70%, in 2019 about 75%, and in 2018 over 78%.

The crisis we are facing is the effect of many factorswhich overlapped at one time, such as the tense situation on the gas market due to the specific trade policy of Russia, a rapid economic recovery translating into an increase in energy consumption, long windless periods, cold winter, high demand for gas in Asia, which competed for LNG loads with Europe. All this caused energy prices to soar.

The green transition also contributed in part to the crisis. – This is not the only reason, but let’s face it and let’s not pretend that it does not play any role. Because it plays, said Ole Hansen, head of commodity strategy at Saxo Bank. He explained that the constant minimum load on the energy system required to meet the basic needs of consumers in the past was provided by conventional power plants, including coal-fired.

As part of the green energy transition, Europe, which has made the most progress in this regard, is shutting down conventional power plants and replacing them with renewable energy production. – It is easy to increase and decrease the amount of gas supplied to the power plant, but we are not able to determine what the wind strength will be in two weeks – said Hansen.

Renewable energy supplies are indeed variable and difficult to plan. We felt it this year, when the production of wind energy in the European Union decreased by 3%. due to poor wind conditions. This the first annual decline in more than three decades. In 2015-2020, the average annual increase was around 10%. In contrast, hydropower generation decreased due to the drought in Brazil, the United States, China and Turkey.

The summit was organized in this crisis year COP26. The slogans appearing during this year’s event were widely echoed around the world. There were widespread voices underlining the need to renew efforts to reduce emissions, more intensive and more intensive.

And although the effects of the summit may arouse mixed feelings, because the declarations made do not lead to limiting the temperature rise up to 1.5 degrees Celsius, or even up to 2 degrees Celsius, however, do not exclude reaching the destination. The process will be the subject of further debates leading to ever bolder decisions.

Almost two hundred countries from all over the world participated in the event. The inertia of such a body is enormous. Working out a common position in such a broad group seems to be a daunting task. And although there were critical voices, including the Swedish activist Greta Thunberg, who summed up that the results of the summit were simply “blah blah blah”, it should be noted that nearly 200 countries agreed with the conclusion that fossil fuels, in particular coal, will have to start to emerge.

Joanna Maćkowiak-Pandera, president of Forum Energii, indicated during one of the last conferences – sharing the previously quoted position of the IEA – that the only right solution for the future is increased investment in renewable energy sources. – We need new powers. Until 2030, we have a choice of large-scale renewable sources and gas to complement the system, she said. She added that new projects are necessary because more coal blocks will be closed over time.

Monika Morawiecka, president of PGE Baltica, also indicated the need to take action. – Bet on decisive acceleration of RES development. It is necessary to unblock the possibility of investing in onshore wind and invest in transmission networks, because without this the transformation process will not take place. We must have a lot of renewable sources in the system to be able to talk about other technologies, such as the one based on green hydrogen, she said during one of the debates.

Ole Hansen from Saxo Bank also emphasized that we must focus on generating solar and wind energy on an even larger scale, while investing in interconnections that ensure flow and easy access between regions where such production is diversified. – In addition, there is the possibility of storing electricity in batteries and a new generation nuclear power technology, which according to research may prove to be safer than current technologies, and at the same time produce more energy from the same amount of uranium – he said.

Of course, there are also voices, especially in Poland, that departing from coal is a mistake. We give up the raw material in our possession, becoming addicted to our own wishes, incl. from Russian gas. Although it is possible to discuss the costs of obtaining domestic coal and its quality – domestic power plants often opted for imported coal, cheaper, with better parameters.

However, you must remember that this game is not only about the economy, but most of all about the environment, the condition of which has been severely damaged. The climate is changing to our disadvantage, and if we do not change it, we will have to a disaster. We feel the effects of the changes now. However, this is only a prelude to what awaits us in the future.

Before the COP26 summit, UN Secretary General António Guterres called for stop treating nature like a toilet and criticized the continued use of fossil fuels, likening it to “digging our own graves”. Summarizing the event, he announced: “This is an important step, but it will not be enough. It’s time to go into emergency mode. The climate battle is the fight of our lives and this fight must be won.”

Nobody puts down their arms. In a year’s time, another conference will take place where countries are to declare new, higher emission reduction targets on 2030 year. So far we have stumbled on the bumpy road to transformation. But – as experts point out – this does not mean that we have failed. We should act faster and more decisively.

Monika Borkowska

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