KEY FINDINGS OF FOSTERING EFFECTIVE ENERGY TRANSITION 2022:
1. The energy transition is not keeping pace with the growing climate urgency, and recent compounded disruptions have made the transition even more difficult. High energy prices, risks of energy supply shortages, and soaring demand for fossil fuels are simultaneously challenging energy affordability, energy security and access, and sustainability.
2. It is crucial to develop adequate enablers and support mechanisms to keep the momentum of the transition through this turbulent phase. What is needed now, more than ever, is a holistic approach that delivers concurrently on the three transition imperatives – energy affordability, availability, and sustainability – at an accelerated pace.
3. The lack of access to an affordable energy supply has emerged as a key threat to a just transition. Actions are necessary to protect those most vulnerable through appropriate support measures, in a way that incentivizes efficient consumption. Behavioral interventions and fourth industrial revolution technologies can help households and businesses alike.
4. Energy diversity – and security – are in short supply. Dual diversification (of supply source and supply mix) is key to strengthening countries’ energy security. Diversifying the ecosystem of import partners in the short-term and diversifying the portfolio of domestic energy with low-carbon alternatives in the long-term can yield significant benefits.
5. Supply-side interventions will need to be augmented with demand-side efficiencies. Current energy market volatility and security constraints provide an opportunity to supercharge the transition by boosting demand for clean energy and fostering more efficient energy consumption from both industrial and end consumers.
Figure 7 within report: Share of global electricity generation by source, 2000-2021
6. Regulatory frameworks need to be strengthened to drive the necessary actions and investments. Anchoring climate commitments into legally binding frameworks would not only ensure that those commitments endure political cycles, but also provide enforcement mechanisms to keep the long-term implementation efforts on track.
7. Industrial activity generates more than 30% of anthropogenic emissions, yet many industries face considerable challenges to decarbonize. Going forward, “clean demand” signals could be the necessary turning point to scale the projects and investments required for the development of low-emission industries.
Figure 10 within report: Emissions by sector vs global emissions (51 GTCO2e)
8. The solutions to industries’ net-zero chokepoints are seldom found within a single company or even industry. A new generation of ambitious multistakeholder collaboration models between suppliers and customers, industry and cross-industry peers, and the wider industrial ecosystem of stakeholders has emerged and needs to be built upon.