The world needs a real renewable energy transition plan implemented asap from an environmental, economic, and political perspective. But are the global ecological policies currently enabling the transition from fossil fuel to renewable energy? Can we agree that the world is now on an unsustainable path? As of 2012, the world has emitted 9.7 billion tonnes of carbon dioxide into the atmosphere due to fossil fuels (World Resources Institute). In 2019 the projected carbon dioxide emissions had risen to about 37 billion tonnes (Global Carbon Budget 2019). How could such development in carbon emissions be sustainable?
Zero Carbon Emissions and the Paris Agreement
Firstly, the world needs the transition from fossil fuel to cut carbon dioxide emissions to 0% (zero carbon emissions). Zero emissions aim to keep the annual world temperature increase rate below 1.5° Celsius. By doing that, the global community would therefore meet The Paris Agreement recommendations. to the contrary, the Emission Gap Report 2020 finds that the global temperature will increase by 3° Celsius. Despite the drop in Emissions in 2020 due to the COVID19 Pandemic, the world is far from achieving its goals. In other words, these Outcomes do not meet the Paris Agreement recommendations. But the most alarming issue is the increase in global carbon emissions after the COVID19 Pandemic.
Renewable energy contributes to only a tiny share of the global energy consumed (IEA (2020), Global Energy Review 2020, IEA, Paris). The world should increase this percentage to about 40% to 80% to realize any significant change. The policies should encourage or create competitiveness between renewable energy and fossil fuels. The competition can be with or without the need for government support in the transition period.
Local and Global Renewable Energy Transition Policy
Both local and global strategies for renewable energy transition should determine policy outcomes (See macroeconomic policy objectives). In Germany, for instance, the Federal Government enacted a policy to enable the renewable energy transition, famously known as the >>Energiewende<<. The Term >>Energiewende<< means “energy transformation or turnaround,” which transcends as a call for change in the energy sector.
On the global level, the UN secretary-general has called the international community to speed up the process of the renewable energy transition. According to the UN, the global community should achieve zero emissions by 2050. But the global fight against climate change has yet to intensify, and the call to phase out fossil fuels still has to gain momentum. We should also not ignore that the global fraternity of nations fears the dependency on more renewable sources like solar power, nuclear energy, wind, and bio-generated energy.
Challenge of Renewable Energy Transition and Fossil Fuels
The world faces challenges in the implementation of the transition from fossil fuels to renewable energy sources.
Assets in the Form of Machinery
The world is full of valuable assets in the form of machinery that consume and emit carbon dioxide. A good example is combustion engine vehicles and coal power stations. Combustion engines have 10-15 years, while coal power stations have a lifetime of 40 years. Firms would be reluctant to retire such assets unless new renewable energy replacements are accessible at efficient costs.
We can argue from the above that the transition to clean energy will take decades. In history, it took decades to implement the fuel energy transitions fully. However, some countries have increased the pace of renewable energy transition through government-imposed emission standards, increasing education on sustainability, and personal relevance of sustainability. The latter is characterized by communities becoming more self-aware of their role in contributing to the solution. We can emphasize the need to make choices not driven by tax incentives or costs but by the awareness of the need for change.
Oil-dependent economies will feel the impact of the renewable energy transition. Such a global move will affect fossil-fuel-producing and -consuming countries, shifting their production and consumption plans. These Economies need to reform to become less dependent on fossil fuel extraction and sale. They should instead exploit their comparative advantage and shift the game towards increasing the renewable energy market share. Saudi Arabia has taken a massive step in this direction by constructing a $5 Billion Green Hydrogen production facility (Bloomberg). The plant is projected to produce 650 tons of Green Hydrogen. This output would dwarf that of a similar plant in Quebec, making an estimated 9 tons of Green Hydrogen per day.
The dominant players in a clean energy world may differ from those in a fossil-fuel-dependent world. Countries rich in natural resources -particularly fossil fuels- have a derived measure of Geo-Political influence. The transition to clean energy will have profound implications on who holds power in the world. Geopolitical risks can be mitigated as the demand for fossil fuel falls.
A Renewable Energy-dependent world is more electrified and more digitized. People and organizations must increase data protection to protect themselves from malicious intent successfully. This requires investments in creating awareness of prevention and security best practices for people and organizations.