IEA Analysis Says Russia-Ukraine War Accelerates Energy Transition

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JAKARTA, THE NUSANTARA POST- Russia’s invasion of Ukraine triggered a global energy crisis which in turn has the potential to accelerate the transition of the world’s energy system from fossil fuels to renewable energy. This was revealed in the World Energy Outlook (WEO) 2022 published by the International Energy Agency (IEA) Thursday, October 27 yesterday.

In the WEO scenario based on the current policies—in Outlook it is called the Stated Policies Scenario—the total demand for fossil fuels continues to decline from mid-2020 to the end of 2050.

IEA Executive Director Fatih Birol confirmed this. According to him, the decline is even faster and more pronounced in the more climate-focused WEO scenario.

“With current policies, the energy world is changing dramatically. The response of governments around the world has been to pledge to make this crisis a historic turning point towards cleaner, more affordable and safer energy systems,” said Birol.

In the Stated Policies Scenario, the share of fossil fuels in the global energy mix falls from around 80% to only 60% in 2050. Global CO2 emissions are also slowly falling from a high of 37 billion tonnes per year to 32 billion tonnes in 2050. The decline will also occur. in the global coal trade.

This Outlook calculates based on the promise scenario announced by the governments of the world’s countries (Announced Pledges Scenario/APS) which states that global coal trade will decline by 25% until 2030 and 60% until 2050.

“Indonesia’s exports will decline by 30% until 2030 because the market for coal, which is used as fuel, such as for steam power plants, will decline,” citing the 2022 WEO report.

In the Net Zero Emission (NZE) scenario, global coal trade will even fall by 90% between 2021 and 2050 as clean energy technologies are rapidly and progressively replacing coal across energy systems.

The WEO 2022 report also projects an increase in energy demand worldwide. In Southeast Asia, annual average energy demand growth is more than 3% compared to 2021 to 2030, with coal continuing to dominate the electricity sector.

However, with the full implementation of the promises announced by the governments of countries in the region, especially Indonesia which wants to stop coal-fired power plants by 2050, the use of coal in the electricity sector will fall by more than half by 2050 and renewable energy will quickly become a source of power generation. greatest power.

According to Birol, “The journey to a safer and more sustainable energy system may not be smooth. But the current global energy crisis makes it clear why we need to move forward.”

Achmed Shahram Edianto, an energy analyst from the climate and energy think tank EMBER, said the same thing. He said, “This report confirms that the increase in global coal demand in the power sector is only temporary.

The portion of coal power generation (unbated coal) will continue to decline. Although the energy crisis has reduced the world’s attention to the climate crisis, the answer to both is the same, the transition to clean energy.

Meanwhile, Putra Adhiguna, energy analyst from the Institute for Energy Economics and Financial Analysis (IEEFA), said that the role of gas as a ‘bridge’ for the energy transition will be under great pressure. With Russia marginalized as a giant gas exporter to Europe, the push to shorten this bridge is getting stronger.

Price volatility makes it difficult for developing countries importing LNG (liquefied gas) to compete with large markets. “This also suppresses the reputation of gas as an energy that often promises affordable and reliable energy options,” he said.

Putra added, “Indonesia still has gas reserves that could last for decades, but we must be very careful in encouraging massive use of gas at ‘false prices’.

“Protecting power plants and industries at artificial prices supported by the government is only a runway that must be used properly,” he said. (Jekson Simanjuntak)

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