The Speaker
Thursday, 22 February 2024 – 03:09

The energy crisis: an opportunity or a challenge for Europe’s renewable energy transition?

NOTE: This is an opinion article – any views expressed in this article are those of the author and not necessarily those of The Speaker or any members of its team.

By now, most people have heard of the importance of a transition towards renewable energy for combating climate change. Recently, many governments have been increasingly focusing on their climate policies, moving away from fossil fuels towards greener sources of energy. Europe is notably leading this change, with initiatives and pledges such as the ‘EU Green Deal’, a set of proposals striving to make Europe the first climate-neutral continent.

In 24 February 2022, Putin launched the war in Ukraine. His weaponisation of gas exports resulted in rising energy bills across Europe, worsened as the continent faces an uncertain and long winter, full of tough choices for securing its energy supply – for many governments, by any means necessary. It is not surprising that concerns are now being raised about the impact of the energy crisis on Europe’s climate ambitions.

Russia’s invasion of Ukraine could transform Europe’s energy landscape for decades to come. On one hand, experts including Niklas Hohne of the NewClimate institute says the energy crisis could deepen Europe’s dependence on fossil fuels. On the other hand, experts including Francesco La Camera, who leads the International Renewable Energy Agency, sees it as an opportunity to accelerate the green agenda.

Challenge – how the need for energy security is negatively affecting climate action

Unfortunately but rather unsurprisingly, most European countries have put their focus on renewable energy aside in order to tackle the energy crisis.

The first way in which governments are doing this is through a shift back to coal. According to LSE, between January and August this year, thermal coal imports to the EU jumped by 35% compared to 2021. Currently, a third of German electricity comes from coal, and countries such as Greece and the Czech Republic are extending the lifespans of coal-fired power plants and mining operations. It is probably not a coincidence that these trends have overlapped with a rise in global greenhouse gas emissions.

Secondly, the transition towards greener energy sources bears a big financial burden. The European Commission estimated that reaching the current EU 2030 climate targets would require additional investment of 260 billion Euros per year (this was before the current energy crisis had even started). The financial consequences of the energy crisis are also immense, causing many governments to allocate funding to shield households and businesses from rising energy expenses. This is not only affecting government’s budgets and willingness to invest in the green transition, but also the private sector, and its own demand for clean investment, as individuals and companies are spending more and more money on energy bills.

Opportunity – how governments can use the energy crisis to boost the green transition

The IEAs annual World Energy Outlook acknowledges the economic impact from limiting Europe’s dependency on Russian oil, gas, and coal, but is keeping an ‘environmental best case scenario’ in which no investment in new fossil fuel projects is needed.

Fortunately, although few, we have examples of countries that combine energy security with a green transition. About 70% of France’s energy comes from nuclear power. Nuclear power is not renewable; however, it does not emit greenhouse gases during its production. Very recently, the European Commission labelled this type of energy as ‘green’, and under the new EU approved taxonomy, the EU will recognise new nuclear plants built through 2030 as a transitional energy source (as long as they are used to replacing fossil fuels). In countries such as Finland, where gas makes up a smaller portion of the gas energy mix (relying on nuclear and hydropower), the impact of the war on its energy security won’t be as great.

Many argue that a green transition is not only beneficial for the planet, but also necessary to solving Europe’s energy crisis. The more we invest in clean energy today, the less we will heat the planet and, the less we will have to spend on the consequences of the energy crisis later on.

After Russia’s invasion of Ukraine, politicians are also realising the dangers of relying on countries that do not share the same set of moral values for the trading of energy. For example, Germany imported over 60% of natural gas from Russia before the war. That, combined with its rejection of nuclear power meant that Germany had very little alternative from Russian gas, causing it to temporarily delay the Green Deal (which aims to meet the long-term goal of reaching net-zero emissions by 2050), and reopen some closed coal-fired power plants, one of the most damaging fossil fuels to the environment. Other countries, such as Austria, have taken similar steps to Germany.

Conclusion

Overall, at least for now, evidence suggests that most European countries are likely to increase their greenhouse gas emissions, and take whatever action is necessary to solve the energy crisis, prioritising the needs of businesses and households over the climate emergency. Most European governments’ approach to Europe’s energy security does not seem compatible with promised initiatives for the mitigation of climate change.

It is hard to predict what is going to happen in the long term, as no one knows when this war will end, or how European countries will deal with energy policies once it does. Thus, we can’t be sure how long these (hopefully temporary) measures will last. However, governments should ask themselves this: is it worth delaying investment in accelerating a green transition and mitigating climate change now, just to have to pay the even higher price of dealing with the consequences later?

Skip to content