Written by Joe McDonald
Jun 15, 2023
Written by Joe McDonald, CEO of tem.
The world is at a turning point in terms of energy production and consumption. As we work towards meeting climate targets, the transition away from fossil fuels is becoming increasingly urgent and not just a question of “if” but now importantly also “when”. However, as we have seen with phasing out coal, the actual transition could drag on for years – certainly longer than we need for climate targets to be met.
When we look at the motivations behind prolonging the phase-out, it comes down to both a small group of people dragging their feet because they're currently raking in loads of cash from centralised fossil fuel commodities, and another small group stalling because they stand to make a fortune from new centralised fossil fuel production in developing economies.
Before we think about how to effect the rate of the transition it is important to think about what a sustainable energy system looks like? There are two main paths that can pave the way:
A new, fairer decentralised energy system where profit and benefits are shared locally with end-users through a combination of local wind, solar, hydro, battery (and yes maybe sci-fi-like micro nuclear fusion reactors).
Big energy companies and backroom government deals to build large centralised sustainable energy projects such as massive offshore wind farms, expensive subsidised nuclear power plants and other transmission-connected assets.
The good news is that both will get us to our needed carbon targets, I feel strongly that this is inevitable. But the bad news is that the pace of transition and its impact on wealth and power distribution can vary significantly depending on which strategy takes the lead. It could be a missed opportunity that will cost us dearly as a human family.
Both of these paths require enormous amounts of government stimulation. The first path requires a dynamic, smart government that engages with improving the standard of living of the people they govern and is willing to amend complex local planning, tax/subsidy and other regulatory barriers in order to build many distributed and digitalised renewable energy projects. The second requires behind-closed-doors deals with a few individuals to provide simple, large-scale planning and tax/subsidy incentives.
The question then becomes: which path is most likely to be taken? When reflecting on the sort of world we live in today, it's clear that “behind-closed-doors” deals with a few individuals are often the norm.
The hope is that when the majority grasps the emerging window of opportunity to reshape both our environment and economy, history will break free from repetition.. Which is why it’s important for governments, companies, and individuals to take action now to move towards thoughful sustainable energy production and consumption.
The transition away from fossil fuels will not be easy and is at real risk of being dictated by those already in power that have proven to not have aligned interests with the end-users of the energy markets. Yes it is necessary for the health of our planet and for future generations, but the real opportunity goes beyond only environmental impact and offers an opportunity for a better, more sustainable future for all.
Watch this space.