How coronavirus has impacted the world energy industry
‘We can humanise energy and we must do so urgently’
The brutal shock of coronavirus has had a deeply uneven impact on communities and economies around the world. The world energy industry is no exception.
The crisis has highlighted the importance of energy in all our lives, for homes, health and digital productivity. It has also tested the resilience of grid systems and spurred new investment in deeper decarbonisation of heat and transport sectors.
Access to modern energies is easily taken for granted; affordability, reliability and equity matters are frequently overlooked. Despite free sunshine, household energy debt, fuel poverty and even defaults on mini-grid payments are increasingly evident.
Only the lucky few have abundant energy to light, heat or cool their homes. Hundreds of millions live with zero access to electricity and billions more people lack energy for clean cooking, sanitation and better livelihoods. The gap between those with abundant access and those without enough energy is widening.
Should societies bet on techno-fixes to provide the cure all? Many green energy solutions are in their infancy and there is little thought about new and different future energy needs. Neither technology promoters nor capital market investors focus on the human pace of the “race to zero”. Affordability and energy justice matters are mobilising more people and communities, especially those impacted by transition, to become involved.
The time to humanise energy
Political and policy discussions are starting to touch on the new social energy agenda and it will be important to look beyond peak demand for coal and oil, and address winners and losers, and meet growing demand.
We can humanise energy and we must do so urgently. The flows of clean, affordable, reliable and equitable energy are the lifeblood of progress. Securing clean energy and flexible storage for everyone will not be easy. It can be achieved through investment in renewables and other clean energy friends, net-zero emissions heat, power and liquid fuels.
The race to zero ignores this nuance and risks extreme polarisation between green-only energy winners and many more losers. Whose energy decisions are being driven by concerns about the end of this week, the end of the world or both?
The scale and scope of the existing energy system and materiality of the renewable power revolution are not well understood. It is frustrating to be engaged in so many debates which reduce the “tutti fruiti” of modern energies and their uses to the apples or pears of solar and wind power. Not everything can be electrified, yet. Lack of energy literacy, including among some investors, policy-shapers and journalists, is a risk to the future of humanity.
Building forward together
People, new uses and demand dynamics are missing in energy outlooks. We owe it to future generations to maintain a healthy planet. Let us inspire children to keep reaching for the stars. Energies for flying cars, meteorite mining, quantum warp drive engines are exciting possibilities.
Building forward together will involve recovery along multiple pathways and benefits from a new mindset of customer centricity and demand-driven solutions. There needs to be a safe space for honest discussion of the full costs to society, stranded communities and the “more energy” implications of new human and economic development models. We can offer a safe space, as the world’s oldest, neutral and independent world energy organisation, to address these political undiscussable questions.
By the United Nations Climate Change Conference, COP26, in November, the work on new metrics for the “S” in environmental, social and governance, or ESG, reporting by energy investors and firms should be concluding, not starting. And by the end of 2021, we can all share stories of success in humanising energy, which inspire future generations of energy entrepreneurs.