The climate crisis has become a mainstay topic globally over the last decade. And the buzz around Climate Change and the need for sustainable energy sources will only continue to grow as we move toward greater consumer demand for access to renewable sources of power and a lack of energy security when reliant on fossil fuels.
Globally, the energy sector has faced a great deal of upheaval over the last few years. From the COVID-19 pandemic disrupting the supply, the energy prices shocks throughout 2021 into 2022, to the current crisis in Ukraine highlighting how vital energy security is.
In this blog, we look at how the crisis in Ukraine is affecting energy use globally and how it is a push for countries to transition from fossil fuel to renewable energy sources. Due to the hold Russia has on a large portion of the Globe’s fossil fuel energy source, the fallout from the invasion itself, and the rising prices of fossil fuels, the world is wondering if now is the time to expedite the move to renewables.
Russia – a global, top three fossil fuel provider
With many countries cutting ties with Russia, it brings to question – what about our energy?
Russia provides much of the world with fossil fuels for energy. Notably to Europe where in 2019 the union imported around 40% of its natural gas, more than one-quarter of its oil, and about half of its coal from Russia REF1.
Since the invasion, the EU has planned to cut ties with Russian resources by at least two-thirds by the end of 2022, and an ultimate goal to eliminate ties entirely over time REF2. However, the EU is continuing to see high consumption rates of Russian fossil fuels since the invasion – with an estimated $58.5 billion in payments to Russia since February 24, 2022 – and the number only continues to grow REF3.
“The war adds to the series of supply shocks that have struck the global economy in recent years,” the IMF stated in a report. “Like seismic waves, its effects will propagate far and wide — through commodity markets, trade, and financial linkages.”
Countries are reconsidering their energy supplies, where it comes from, and the source of – trying to sever their energy dependence on Russia. Just recently, Germany announced it is accelerating its efforts to transition to a 100% renewable electricity system by 2035 REF4.
Besides the dependency on Russian fossil fuels, experts are also looking at the impacts the invasion of Ukraine will have on climate change and global warming, more specifically how it could speed things up.
The environmental fallout of conflict
As the turmoil continues to unfold, we are seeing the impact of the physical conflict itself on climate and the many associated risks. Namely, burning fuel tanks, damaged gas pipelines emitting increased carbon emissions, and the threat of nuclear weapon usage.
Ukraine itself generates about half of its electricity with nuclear power – with 15 reactors generating energy that are at risk of explosion REF5. As well, the metals in the fired weapons – shells, rockets, missiles – will remain in the atmosphere for decades to come.
The European Climate Foundation raised the ambition to net-zero emissions in Europe by 2050 REF6. And the crisis in Ukraine is a reminder of how quickly things can turn around and the importance of transitioning to renewable, clean energy sources as soon as possible.
The idea of renewable energy sources is far from new. At the end of April 2022, the US state of California came in at 99.87% powered by renewable resources. With 66% solar and 25% wind generation and the remaining parts a combined geothermal, biomass, biogas, and hydro power REF7.
Renewable-ready attitude with those facing the price at the pump
From 2021 and into 2022 we have seen shocking prices of gas and oil, and consumers have been left feeling frustrated. The pandemic left most people inside – no longer commuting to work, school, events, and more. Driving the demand for gas and oil down extensively. Still, when the pandemic began to ease, the demand for gas and oil rose at a rapid rate, and oil companies were not prepared for the sharp incline and have been slow to catch up. Thus, the increase in price began.
Bringing us to early 2022 and the Russian invasion of Ukraine. As mentioned, Russia is a large global supplier of oil and gas and brought into question the overall security of energy – raising the prices of oil across the globe. Prior to the COVID-19 pandemic, oil prices were in decline due to a bidding war between Saudi Arabia and Russia to provide the world with fossil fuels. But with Russian oil now being banned in most of the world, the prices continue to be driven to all-time-high numbers.
Transitioning to a world run on renewables
With 73 Countries committed to net-zero CO2 emissions by 2050 REF5, the recent events involving Russia and Ukraine beg the question – is it time to speed up the transition to renewables?
In summary, the crisis in Ukraine has drawn fierce attention to the question of energy security and led businesses and governments to challenge current strategies. Is the phase-out of finite resources feasible, or equally, does it highlight the need to increase and accelerate the provision of renewable sources of energy?
At Hansen, we believe that the future is one that will rely heavily on renewables. As such, Hansen enables this energy transition to renewables and empowers companies with its market-leading suite for Energy and Utilities.
To read more on the current Energy Transition and predicted trends for the future, check out the Hansen Energy Transition Series 1, Series 2, and Series 3.