1. Energy security matters
Before Russia President Vladimir launched the invasion of Ukraine, the notion of energy security – nations exercising maximum control over their own supplies – was mainly for PowerPoint slides at industry conferences.
That changed forever a year ago, when severing reliance on Putin’s gas shot to the top of the national agenda in – to name but one example – Germany, which within days had to rip up decades of energy policy based around Russian hydrocarbon supplies. Cue a frantic effort by Europe's largest economy to find new sources of gas – in which it has largely succeeded – and turbocharge its renewables build, where the jury is still out.
2. Renewables now win two ways not one
Wind and solar power were already leading the charge against climate change but are now in demand for more than their zero-carbon credentials. If energy security means controlling your own supplies, a nation’s renewable resources are mercifully beyond Putin’s control.
As International Energy Agency chief Fatih Birol put it: “Renewables were already expanding quickly, but the global energy crisis has kicked them into an extraordinary new phase of even faster growth as countries seek to capitalise on their energy security benefits.” The fact that their key fuels – the wind and sun – are free is another bonus in an era of eye-watering gas prices.
3. Oil & gas giants still (mainly) oil & gas giants
Pre-invasion the world’s big fossil fuel players, especially the European supermajors, seemingly had little time of day for the oil and gas that still made up the vast bulk of their earnings, preferring to focus on energy transition activities and a growing array of emissions targets on the road to net zero.
Courtesy of Putin’s aggression and the energy crisis it sparked, however, old fashioned fossil revenues are flooding in and returns from renewables look lackluster in comparison. With BP annoucing it plans to pump more oil for longer than previously expected – albeit while insisting its green ambitions remain undimmed – and challenges over the true extent of Shell’s transition spending, Big Oil looks more like its old self than it did a year ago.
4. Policymakers CAN act fast and think big
After years of UN climate summits that have seen global decision makers move at snail’s pace, a dose of Russian military aggression has sent policymakers into overdrive. That’s particularly true in Europe, where by early March last year EU leaders had already assembled REPowerEU – an accelerated package of targets in renewables and green hydrogen designed to boost electrification and lessen reliance on imported gas.
When taken alongside the epic green policy decisions of Joe Biden’s Inflation Reduction Act across the Atlantic – with which the EU has already butted heads – the West suddenly looks like a hotbed of green ambition. As always, however, the devil’s in the detail, and unless someone can get down into the nitty-gritty and work out how to speed up permits for a new utility-scale wind or solar farm, the whole thing could end as a damp squib. In the words of EU climate chief Frans Timmermans: “It's hard, bloody hard. But it's possible.”
5. Security of energy also matters
The Ukraine war era has plunged the vulnerability of critical energy infrastructure into the spotlight as never before, most dramatically with explosions at the Nord Stream gas pipeline that many in the west blame on Russia. With its dramatically escalated role in national power mixes, offshore wind has now emerged as an area of particular anxiety.
Concerns cover not just the vulnerability of turbines at sea to physical attack – the Dutch escorted a Russian vessel out of its waters over just such fears – but also in the digital arena, with a US government report finding “specific challenges” over cybersecurity of offshore wind.