Accelerating the Ongoing Energy Transition: The Next 10 Years and Beyond
Change—it’s all around us.
The United Arab Emirates (UAE) is aiming to have some of the world’s cleanest cities, to reduce its greenhouse gas (GHG) emissions by 70 per cent in the long term and to reap the net employment benefits of moving at least 50 per cent of its electricity generation out of fossil fuels.
The Roman God Janus is guiding Mexico’s energy transition, with one face pointing toward the fossil fuels of the past and the other to the renewables of the future.
Spain will meet its 2020 and 2030 GHG emission targets and wants to integrate renewables into the electricity mix even further.
In Saarland and Lausitz, two traditional coal-mining areas in Germany, initiatives are underway to take the next step after the end of coal mining: to reduce coal burning for power generation.
I recently attended the 4th Berlin Energy Transition Dialogue, where I participated in a panel discussion alongside ministers and senior experts assembled to share what we can learn from these and other experiences in the transition away from coal, oil and gas around the world.
“We are at a time where renewable energy no longer needs subsidies,” said H.E. Eng. Suhail Mohamed Faraj Al Mazrouei, UAE Minister of Energy & Industry.
The panelists agreed that consensus on how to execute the energy transition is needed, and examples of successful transition stories demonstrate that it can be done in many ways:
- Spain has sought to present the facts and figures to its population, to facilitate an informed debate.
- President Peña Nieto of Mexico negotiated cross-party consensus with the main opposition parties early in his term to get the necessary constitutional amendment to break down fuel and electricity monopolies.
- “Involve the people” has been the mantra in Saarland, while in Lausitz a voluntary group of businesses has been developing its proposal and plans for how coal and other companies should refocus and innovate post-mining.
In this IISD report, we summarize findings from case studies of coal transition in regions in South Wales, Northern Spain, the United States and China.
|South Wales, U.K.||The Welsh Development Agency had some success in attracting investment, but more went to urban areas than the valley communities where the mines had closed. Primarily service jobs were created, where pay was lower than mining.|
|Asturias, Northern Spain||Generous early retirement schemes helped families and communities maintain economic purchasing power but did not prevent social problems and migration.|
|Appalachian Region, U.S.||The Appalachian Regional Commission has used a 4 per cent sales tax on coal to offer a range of grants over a period of more than 30 years; in that time, coal mining jobs have reduced from 120,000 to 12,000. Net job creation in the region, but typically lower-paid service jobs|
|Shanxi Province, Northern China||Little progress towards economic diversification despite over 10 years of efforts. National priorities are not local priorities. A CNY 100 billion fund and assistance schemes have been more successful with formal employees.|
Highlights from report, At the Crossroads: Balancing the financial and social costs of coal transition in China
But where will the transition from fossil fuels lead us in 10 years? The panelists saw a positive future: the representative from UAE said that more than 30 percent of their electricity grids would be made up of renewable energy, while Mexico said they are aiming for more than 35 per cent renewable, a significant part of which would be distributed and would thus empower people.
Spain anticipated continuing progress provided that targets remain credible and the pace of change reasonable, while the German delegates noted that there would be many stranded fossil fuel assets to manage. IISD is confident in broad uptake of the coal transition around the world, but whether the impacts are good or bad will depend on decisions taken and processes put in place now.
Voluntary initiatives offer both peer learning opportunities and the many benefits of moving forward together. One notable example is the Powering Past Coal Alliance, which unites over 30 national and subnational governments as well as companies whose ambition it is “to accelerate clean growth and climate protection through the phase-out of… existing traditional coal power” and that place “a moratorium on any new traditional coal power stations.”
Recent commitments to ban or limit oil and gas exploration and production by Belize, Costa Rica, France and New Zealand are moving commitments beyond coal. In the concluding words of session moderator Dr. Ortwin Renn of the Institute for Advanced Sustainability Studies in Pottsdam: “we can all learn from each other.”