Relevance: GS-2: Regional and global groupings and agreements involving India and/or affecting India’s interests; Effect of policies and politics of developed and developing countries on India’s interests; Important International institutions, agencies and fora; Conservation, environmental pollution and degradation

Key Phrases: Global energy transition, Glasgow Climate Summit (COP26), net zero emissions by 2050, European Green Deal, REPowerEU programme, clean and efficient technologies, decarbonization.

Why in News?

• In light of Russian invasion of Ukraine, the big question is whether it would have irreversible impacts on the global energy transition and what are the ways in which it can delay that transition even in an optimistic scenario.

Key Points:

• When the world leaders met at the Glasgow Climate Summit (COP26) to firm up their ambitions for a decarbonized planet, no one imagined how drastic would be the turn of events around them in only a quarter.
• It is doubtful if any of the scenarios created for countries’ declared goal of achieving net zero emissions by 2050 took geopolitics in to account, much less the risks arising out of an unstable region.
  • However, the Russian invasion on Ukraine did upset this apple cart in one go.
• The basic architecture on which all of climate change fight is built - the unrestricted flow of technologies, material, and finance; and most of all, the global collaboration – itself stands challenged today.

Concerns:

• The recent decision of the U.S. to impose sanctions on Russian energy may very well have far reaching ramifications, from the point of view of the European Green Deal and its energy transition.
• While the EU plans to reduce its dependence of Russian gas by two-thirds before the end of 2022 under its `REPowerEU’ programme, it is worth mentioning that natural gas was, and remains, an important part of its energy transition especially for the coal rich member countries.
• With unrestricted gas supply under threat now, experts opines that there be a rush to fire up those very coal power plants that were about to be mothballed.
• An IEA (International Energy Agency) 10-points Plan of March, 2022 recognizes that `The main near-term option would involve switching away from gas use in the power sector via an increased call on Europe’s coal-fired fleet or by using alternative fuels – primarily liquid fuels – within existing gas-fired power plants.’
  • The IEA paper underlines that `Accelerating investment in clean and efficient technologies is at the heart of the solution, but even very rapid deployment will take time to make a major dent in demand for imported gas’.
  • It is estimated that the restart of 17 GW of coal power plants across Germany, Italy, the UK, Spain, Portugal, and France could be employed to compensate the gas shortage.

• Reportedly, in countries like Germany, Spain, and UK; fossil fuels options, including fracking, are once again under consideration; at least in short-term.
  • But how short would that short-term be and the resultant increase in global emissions are some imponderables.
• Furthermore, the rethinking on military spending among EU member countries may take a priority over decarbonizing for some time to come.
  • Germany and Sweden already enhancing their defence budgets: USD 112.7 billion of the 2022 budget and 40 per cent increase in the defense budget for 2021-2025, respectively
  • At the minimum, this could very well tamper the speed of the transition. Or the U.S., U.K., and EU may still continue with their original ambitions but effectively back loading the key targets towards 2050.
• On the other hand, countries might also need to reallocate funds to cushion their citizen from inevitable soaring energy prices.
• There are concerns that the combination of these factors yet again delay a timely discharge of their commitments towards USD 100 billion a year climate financing by 2023.
  • After all, to garner the additional yet scarce resources to address domestic and regional compulsions, that too after prodigious stimulants during the pandemic, possibility of prioritization may not be ruled out; particularly if those very resources are meant for others, the developing countries.
• In that scenario, the developing countries may have to face the double whammy; on one hand cope up with the rising energy prices and the resultant inflation and on the other hand, lack of resources to pump prime their decarbonization efforts.

Conclusion:

• Post the cold war era everyone assumed that geopolitics has reached a steady state. But this was not to be. And the way situation is developing, a return to the status quo ante seems rather difficult.
• The impact everyone is hoping for, however, is that this energy crisis will force Europe and U.K. to double down on their efforts to transit to clean energy, that an urgent need to be energy secure will accelerate countries’ investments in clean technology development and deployment.
• However, the question arises if these enhanced investments in their domestic transition will leave sufficient fiscal room for these countries to still honour their commitments of USD 100 billion a year climate financing by 2023?  So, in one way or the other, there is a likelihood of consequences for energy transition taken as a whole.

Source: Economic Times

Mains Question:

Q. The recent changes in Geopolitics would have irreversible impacts on the global energy transition. Analyse Critically (250 Words).