Six barriers holding back Europe's energy transition
Hard-hitting report spotlights the pain points in Europe’s energy sector – and how they can be remedied
- Barriers include supply chain weaknesses, inflexible grid infrastructure and incomplete digitalisation programmes.
- Energy sector is facing its own ‘pandemic moment’ and needs to deliver an energy transition vaccine.
- Greater sector collaboration demanded to create frameworks to increase investor certainty, future-proof the grid and accelerate innovation
A new report spotlights six standout pain points that are hampering the acceleration of the European energy transition
Breaking Barriers: What's Holding Back Europe's Energy Transition, is the result of roundtable research and one-to-one interviews with hand-picked experts from the energy sector.
Their state-of-the-sector conclusions pull no punches, while their recommendations call for proactive and unprecedented action.
Produced by Enlit, the exclusive report shines a spotlight on some of the uncomfortable truths facing the post-pandemic energy sector, particularly in light of global events in 2022.
“This report doesn’t flinch in highlighting the bottlenecks to progress that the sector is facing, yet it also has a roadmap to overcome them,” said Kelvin Ross, Editor-in-Chief of Enlit.
“The energy sector is facing its own ‘pandemic moment’ and needs to deliver an energy transition vaccine: it needs to work out how to compress what usually takes several years into several months. Our report suggests where it should start.”
The six barriers highlighted by the report are:
It is important to remember that most of the energy transition costs are a one-off capital expense. These investments will make energy cleaner and cheaper in the future. However, there is a cost of doing nothing, and the current energy support packages are just one aspect of the cost of a delayed transition.
“Whatever that final bill is, we'll have to pay it. We have no option as a species. So, we need to start working out how we can pay that bill and the mechanisms for the world to do so.” – Think Tank Round Table Delegate
Supply Chain challenges
The fragility of our supply chains has been exposed by the pandemic, rising inflation, increased costs of raw materials, and the war in Ukraine. While many believe these factors will be short-lived, there are other long-term factors that must also be addressed.
“Integration with other sectors is vital. We must look into eMobility, heavy transport – shipping, aviation and trucking – cement, chemicals, steel, and heating and cooling.” Roland Roesch, Deputy-Director of the IRENA Innovation & Technology Centre
Customer Engagement and Centricity
Customers are not as engaged in the energy transition as much as we might expect. Why is this? Part of the problem is that the old system works. Customers are used to always-on power. Sixty-two per cent of our industry survey respondents believe that creating frameworks that encourage prosumerism is a leading challenge to market design.
Almost all the projects that deliver 2030 targets rely on the electricity grid. However, issues with the power grid – particularly in distribution networks – eighty-one per cent of our industry survey respondents believe that distribution infrastructure is not sufficiently resilient to meet the demands of the energy transition.
Political Will and Market Design
The unbundled European energy system is broken into functional silos where each silo must be self-sufficient. Stakeholders acting in their own self-interest often cause negative consequences for others. It is only when the entire energy system is transformed that it becomes cheaper for everyone.
“Don’t count the trains before you build the rail. There won’t be many trains.” Chris Peeters, Chief Executive Officer, Elia Group
Incomplete digitalisation programmes
“The enabling technology, the digital solutions, are not available yet. We must go from POC, to pilot, to deployment. And we must do this in a 10-year timescale.”
Ana Domingues, Director Energy Industry Executive, Western Europe Area for Microsoft.
Among the report’s recommendations are calls to create frameworks to increase investor certainty and reward customers; future-proof the grid; decouple renewables from fossil fuels; and accelerate innovation.
Paddy Young, Director of Enlit, says the report is “the outcome of active collaboration cross-sector: industry stakeholders coming together to achieve a common goal – sustainable and affordable energy for all driven by advanced technology and credible partnerships.”
“By facilitating thought-leaders, innovators and decision-makers to share knowledge and challenge the status quo across borders and time zones, we’re playing a part in the energy transition.”
This Report provides you with detailed discussion of these barriers and, most importantly, recommended actions to counter each one.
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