- Countries that were confidently and successfully replacing coal with lower-carbon natural gas and renewable energy are having to go slow on their energy transition.
- Europe which is by far the most proactive region in global climate action is the most impacted by the ongoing energy crisis.
- With global economies in a fast recovery mode, increased demands for natural gas have prompted prices to more than double this year.
COP 26 climate Summit next week is coming at a time when the world's attention is mostly on an ongoing global energy crisis dominated by energy under-supply and high prices. The crisis stems mainly from a sharp and unexpected rise in energy demands prompted by global economic recovery as Covid 19 pandemic recedes. Energy shortages are also caused by an ongoing divestment from high carbon fuels ( coal and oil ) when replacement renewable energy is not sufficiently available.
Countries that were confidently and successfully replacing coal with lower-carbon natural gas and renewable energy are having to go slow on their energy transition. In the Summit, there will likely be more hesitancy than certainty in committing climate mitigation actions by various countries, faced with insufficient data on how much renewable energy supply will be available to replace fossil fuels.
Europe which is by far the most proactive region in global climate action is the most impacted by the ongoing energy crisis. Russia, which supplies about 40 percent of Europe’s natural gas requirements, has been slow in stepping up supplies to Europe, as the region heads for peak winter demands.
It is also reported that wind power plants failed to deliver sufficient output due to weak summer wind speeds. Europe and other energy-intensive economies like China and India are slowing down their withdrawal from coal dependency until supplies of lower-carbon alternatives (natural gas and renewable energy) can be assured.
With global economies in a fast recovery mode, increased demands for natural gas have prompted prices to more than double this year. Coal prices have similarly gone up with increased pressure on supply. Reduced supply of natural gas is causing nations to revert to coal, reversing gains already made in carbon reduction. Replacement of high carbon coal with lower carbon natural gas has a significant impact on climate mitigation actions due to its extensive use in heavy industries and power generation
The clear message emerging from the ongoing energy crisis is that the energy transition from high carbon fuels to renewable energy will be a longer journey than climatologists and green activists would like to hear.
Oil is facing a similar predicament with prices firming up above $85 per barrel. Oil usually impacts the transportation sectors where electrification and related technologies are still evolving. Estimating the pace of transportation transition from oil to renewable energy remains the main challenge in determining how much oil to continue supplying.
How much upstream oil investments to retain, add or divest is an ongoing predicament that has consequences on oil prices. Premature oil production reduction will upset prices and global economies.
Oil-producing countries and companies are cautious not to prematurely cut oil supply earlier than global preparedness with renewable energy. There is an implied commitment to continue meeting whatever global oil demands that exist, acknowledging that these will decline as renewable energy technologies replace fossil fuels. The onus is on the renewable energy capital and technologies to plan to reduce fossil fuels demand by providing sufficient, sustainable, and affordable supplies of low carbon energy.
COP 29 will be interesting to watch. USA influence in the Summit will be diluted by known non-supportive domestic politics, especially from the coal lobbies. Asian economic giants (China, India) will likely revise downwards their previous climate commitments. Europe will as always emphasize the fastest possible energy transition. Developing countries will definitely be seeking more climate adaptation dollars, and these are likely to be less forthcoming. Oil-producing countries will demonstrate how they are adjusting their economies to a future of reduced oil demands.
With over 70percent renewable energy share in its power generation mix, Kenya is already a negligible contributor to the global climate problem. This is why Kenya should not accept the damnation of its only known fossil fuels resources – Turkana oil and Kitui coal. Kenya is however a major victim of climate change impacts and should go for whatever climate freebies we can get from the Summit, especially support for climate adaptation enterprises.