The combined effect of the global lockdown, more ambitious climate policies and the rise of renewables will have a significant effect on European power prices up to 2040, as well as the sales revenues of renewable energies. Carlos Perez-Linkenheil at Energy Brainpool uses their Power2Sim model to look at the data in the IEA’s latest World Energy Outlook 2020 and make quantitative forecasts. The pandemic has caused structural distortions to the … [Read more...]
The IEA’s World Energy Outlook 2020 at a glance
This month the IEA published its annual flagship World Energy Outlook (WEO). Simon Göss at Energy Brainpool picks out his highlights. This year’s WEO has four scenarios, two of them new: an updated “Stated Policies Scenario” (STEPS: what governments have promised), the new “Delayed Recovery Scenario” (DRS: due to Covid), an updated “Sustainable Development Scenario” (SDS: what’s needed to meet the Paris targets), and the new “Net Zero Emissions … [Read more...]
Europe has enough Gas infrastructure. Why build more?
In early November a first vote is expected in the European Parliament on the Recovery & Resilience Facility’s €672.5bn budget. Esther Bollendorff at CAN Europe runs through the arguments against providing any funding for new gas infrastructure. She presents evidence to show that the EU is already oversupplied with gas import capacity, and all new fossil gas transmission projects have been rejected by the market since 2017. Solar and wind … [Read more...]
Are 1.5°C scenarios supplanting “Business As Usual” as the new benchmark?
The world energy outlooks published annually by the IEA, BP and DNV GL look very different this year. 1.5°C scenarios are being taken much more seriously. Could it be because of the trauma of Covid-19, or the extraordinary – though still insufficient – success of renewables coupled with the rising ambition of climate-aware governments and their policies? Either way, they are helping to shift the debate away from the mainstream “business as usual” … [Read more...]
The energy transition needs some of the $12tn global Covid stimulus. But much less than you think
Governments worldwide have committed over $12tn to recover from the Covid-19 pandemic, spent over the next 5 years. Current estimates say the energy transition needs $1.4tn/year globally between 2020 and 2024 to get us on the path to meet the 1.5oC Paris goal. Clearly, there is an opportunity here. Although support for healthcare systems and the overall economy are the stated priority of governments, much of that $12tn is still not committed. … [Read more...]
Renewables shares outperformed fossil fuels over 10 years. Have investors noticed?
Shares in listed renewables firms are outperforming their fossil fuel equivalents, both in terms of returns and volatility. But although investment is rising, they’re still not getting enough to meet our 2050 targets, says the IEA. Why? In this article summarising the first of a series of reports they look at the 5 and 10 year record of the two verticals. In all the three territories analysed – the U.S., the U.K., and Germany/France - renewables … [Read more...]
BP Outlook 2020: “peak oil” has already happened
BP’s latest Outlook predicts – for the first time - that oil saw its peak in 2019. In each of BP’s Outlooks, published annually since 2011, they have revised their predictions for the global energy landscape to 2050 as new data comes in. The growth of clean energy and the changing shape of climate policies have seen each successive forecast increase the share of renewables at the expense of fossil fuels. This year even gas has seen its prospects … [Read more...]
France’s recovery plan: will support for emissions-high sectors compromise a new Green economy?
The French recovery plan, formally presented today, combines emergency rescue measures, economic stimulus and longer-term investments. A substantial €32bn out of the €100bn budgeted is earmarked for the green economy. But Sébastien Treyer at IDDRI asks whether rescue measures for traditionally emissions-high sectors - tourism, aviation, automotive, buildings, agri-food – will collide with climate targets. He references studies that should be used … [Read more...]
Global Coal Database: Covid lockdown may accelerate phase-out
E3G has created a database to track coal’s phase-out across the globe. Though much has been achieved, dating back to 2010, it’s still not on target. Chris Littlecott and Leo Roberts at E3G look at the data from different territories. The OECD and EU28 have made very good progress: 71% of these countries are pursuing coal phase-out, with 58% on track to be coal free by 2030. The article points at successes in the US, the UK, Spain and Germany … [Read more...]
Germany’s Corona stimulus package: what’s in it for energy, climate?
€30bn of Germany’s €130bn Corona economic stimulus package is dedicated to the energy sector and the climate. Simon Göss at Energy Brainpool runs through the four main areas of focus. There’s €11bn to fund a reduction in the EEG levy (renewables surcharge) to help electricity consumers. €9bn goes to creating a hydrogen industry for Germany. There’s €7bn to promote e-mobility (tax exemptions, subsidies, co-financing of charging stations and … [Read more...]
Will Member States support the EC’s green recovery plan?
The EC’s “Next Generation EU” plan for a joint loan of €750bn is a major breakthrough as it accepts the need for the member states to share a large debt burden to revive the EU economy. It will be in addition to the European budget under discussion before the pandemic crisis. The other breakthrough is that green policies – climate neutrality, biodiversity, “food-to-fork” - are central, explains Nicolas Berghmans at IDDRI. He summarises the plan, … [Read more...]
Why savings from the 2009 Buildings Refits stimuli were poor. Let’s do better this time
“Shovel ready” buildings renovations and refits can play an important part in a nation’s economic recovery programme. It gets money straight into the pockets of manual workers doing the refits, across the whole country, cuts the energy bills of all (both low and high income households), and accelerates efficiency gains for meeting climate targets. But first we need to learn lessons from the U.S. renovation stimuli of 2009, says Meredith Fowlie at … [Read more...]
Sales down, but cash preserved too: Regulators take note when setting new Utility rates
Utilities are suffering financial impacts because of the current pandemic, and regulators will be asked to address them when they set new electricity rates. The intention will be to help the utilities recover while keeping bills affordable for their customers. But not all the impacts on the utilities are bad news, explains Jim Lazar at RAP looking at the U.S. Though revenues have dropped and some labour costs risen, there is a list of things that … [Read more...]
EU Recovery Package mustn’t sideline Green R&D
Today (Wednesday 27 May) the EC releases its COVID-19 Recovery package and Multiannual Financial Framework. The Green Deal and net-zero ambitions are expected to be a substantial part of it. Eleonora Moro and Léa Pilsner at E3G draw attention to Research & Innovation (R&I, or R&D), often in danger of being seen as a luxury in times of crisis because the big wins are not immediate. Already, the EU could do much better. Looking at … [Read more...]
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