Government success in upping the pace of the worldwide renewables build-out since Russia’s invasion of Ukraine sent shockwaves through the global energy markets in February 2022 is among the key “takeaways” from the first year of the war, International Energy Agency (IEA) executive director Fatih Birol has said.
Birol, writing on LinkedIn, said “cleaner alternatives” to Russian oil & gas “are growing rapidly as governments seek to strengthen their energy security”, with renewable energy capacity swelling around 25% worldwide in 2022 to almost 300GW, while at the same oil & gas revenues into Moscow coffers tumbled 38%.
“Russia played the energy card and didn’t win, with oil & gas revenues plummeting… over the past year and set to drop even more in the years ahead. It now faces the likelihood of further declines in oil & gas output this year and a permanent loss of standing in the energy world,” he said.
“The amount of renewable power capacity added worldwide rose by about a quarter in 2022; global electric car sales leaped by close to 60%; investments in energy efficiency jumped; installations of heat pumps surged, especially in Europe; and nuclear power is making a strong comeback.”
Birol said: “Government actions and policies were vital. While it has suffered some social and economic bruises, Europe has made real progress in reducing its reliance on Russian fossil fuel supplies and improving the resilience of its energy system.”
He highlighted the ten-point plan launched by the IEA in the weeks after Russia’s incursion into Ukraine that outlined a plan for the European Union to “rapidly reduce its reliance” on the superpower’s fossil gas supplies, as well as the agency’s work since in “debunking prominent myths about the global energy crisis”.
“[The] first [of these ‘myths’ is] the claim that Russia is winning the energy battle. Not true. Second, [is] the fallacy that the crisis is a clean energy crisis. Not true. And [the] third [is] the narrative that the crisis will derail efforts to tackle climate change. Not true.
“As we made clear in our World Energy Outlook in October , the crisis is set to accelerate the clean energy transition as governments respond with stronger policies,” said Birol.
“It is important here to stress that the energy crisis is global. Although some of the biggest disruptions have been felt in Europe and made a lot of the headlines – major impacts are being felt in many emerging and developing economies,” he underlined, noting that the number of people globally without access to electricity “rose last year for the first time in decades as energy prices spiked amid the crisis”.
When Russian invaded Ukraine, according to IEA figures, it was by far the world’s largest exporter of oil & gas, with the EU buying around 50% of the country’s exported oil and over 60% of its gas. Russia’s pipeline flows to Europe have slowed dramatically since, down by 80% from pre-war levels
However, Birol caution the world was “not out of the energy crisis yet” though Europe’s mild winter had “bought a vital commodity – time”.
“That’s time for bold policies to work. Time to implement the structural changes that will insulate energy systems against future volatility,” he said.
“My hope and expectation is that governments will take even stronger policy action to further accelerate clean energy transitions – not only to reduce emissions but also because this crisis has made clear that faster transitions offer a way to enhance energy security and to benefit from a huge opportunity for jobs and industrial growth.”