“To get out of the energy crisis, we need an energy revolution”

Welcome to our watershed moment. The changing climate, disappearing biodiversity, rising costs of living, energy crisis, and food crisis…we find ourselves in a state of multiple, overlapping emergencies – or permacrisis, which has been named the word of the year for 2022.

The World Meteorological Organization has recently reported in their 2022 Global Climate Report that the past eight years are on track to be the warmest on record. Just in the past 12 months, we have experienced a wide range of extreme weather events including heatwaves, droughts, wildfires, dry rivers, apocalyptic flooding, and many more. While this is the reality of a world just 1.2 degrees warmer, the policies currently in place are projected to lead to about 2.7°C warming by the end of this century.

At the same time, energy poverty is soaring across Europe. At least 50 million Europeans are living in energy poverty today – as a result of an energy crisis that is hitting society’s most “vulnerable”. The effects of the energy crisis are felt even more profoundly due to extreme temperatures caused by climate change.

Meanwhile, fossil fuel energy companies have been announcing record-breaking profits – a stark contrast too hard to ignore. In 2022, Shell Energy posted quarterly profits of 11.5 billion pounds which is a 92 per cent increase compared to 2021. The Dutch TTF Natural Gas Futures – which is a virtual gas trading platform – have risen by 112% since the start of June 2022. Norwegian firm Equinor paid out an additional $3 billion dividend to shareholders in 2022 after a strong second quarter, while France’s Total SE saw its income triple to $9.8 billion.

It’s not fair, and it’s not okay. The gravity of this inequality begs important questions such as: how did this happen, and how did we get here? Even though a common conception in Europe has been that the energy crisis happened solely due to Putin’s war in Ukraine and his consequent weaponisation of energy resources, that is not the full picture. We did not get here overnight. The war was certainly a tipping point that made things worse but it was not the primary cause.

When it comes to the current crisis, there were already some supply-side constraints leading up to an energy crunch before Putin invaded Ukraine. As economist Helen Thompson explains in the latest issue of the Green European Journal, the crisis pre-existed the war as a result of two significant moments: the first was the fall in oil production in 2019, causing a gap between global consumption and production which meant a sharp rise in oil prices, and the second was the dramatic increase in China’s demand for gas imports in 2021, which led to competition over LNG between Asian and European countries who ended up paying much higher prices than the US. As a result, energy costs were already putting pressure on households from the autumn of 2021.

Moreover, this is not the first time we are facing a fossil-fueled energy crisis. Since the world became dependent on oil and gas, we have been through several energy crises, which followed the pattern of boom and bust, of crisis and recovery. In the 1970s, the 90s, and now in 2022, we find ourselves once again in the grip of soaring fossil fuel prices.

This pattern signals the fact that the main issue lies in the fragility and unsustainability of the fossil-fueled energy systems and the socio-economic model we depend on to warm, feed, and sustain ourselves.

Since the energy crisis started to take its toll on Europe, politicians and the fossil fuel industry’s proxies have been trying to double down on fossil fuel production as a solution to the soaring energy prices. This ‘fossil-flex’ included a return to coal, labeling gas and nuclear as green energy resources through the EU Taxonomy, and building brand new fossil fuel infrastructure such as LNG terminals.

Therefore, amidst the greenwashing and pushbacks against climate goals, the remedy for the crisis is not only a little bit more renewable energy here and there but adopting a different way of thinking about energy systems, a change in discourse, or more simply put an energy revolution. Now, the big question is: How do we make that happen?

Short-term measures, please meet long-term thinking

It has always been hard for institutional and bureaucratic political institutions to address overlapping and interconnected emergencies that required immediate responses while not losing track of important medium- and long-term goals. As the EU is adopting immediate measures to support households and businesses in the face of the high price of energy, these short-term responses to the crisis must go hand in hand with and pave the way to long-term solutions and climate goals to ensure that everyone has access to affordable renewable energy in the future.

Solidarity rules

The energy revolution in question cannot be achieved without deepened solidarity within and between European societies, since the capacity of local, national, and European authorities to respond to the challenges caused by the energy crisis depends on effective cooperation across borders. While some Member States still implement measures that imply that they can find solutions to the crisis on their own.

At the beginning of the crisis, each Member State shaped its own plans which led to the approach of uncoordinated national relief packages. However, for some member states that could not afford a national fiscal response, this meant not being able to properly help and provide state interventions to protect households and businesses. Without a coordinated EU approach, broad subsidisation of households and businesses in one Member State will lead to the emergence of tensions, an imbalance, and divisions which will be susceptible to further exploitation by Putin. Therefore, a common European response is crucial to make sure that such political and economic fragmentation is avoided.

Renewable energy is the future

To address both the climate crisis and the energy crisis, it is vital that Europe shifts quickly to fossil-free renewable energy. As Friends of the Earth Europe puts it, “We have the technology to build a 100% renewable energy system – now we need the political will.”

Renewables not only produce clean, emission-free energy, but they are now also cheaper than fossil fuels. According to a recent report released by the International Renewable Energy Agency, nearly two-thirds of new renewable power added was cheaper than the cheapest coal-fired power plants in G20 countries in 2021.

While the plans to end dependence on Russian fossil fuels have sped up Europe’s transition to renewable energy, it is important to be wary of falling into similar dynamics of fossil fuel production and consumption which include becoming dependent for renewable energy on similar regimes to Russia like China, producing greenwashed energy that is actually non-renewable like blue-hydrogen and committing neocolonial resource grabs for renewable energy in countries like Morocco, Algeria, and Egypt.

Energy communities are the way forward

The way to profoundly change the way we produce energy production is through a people-powered energy transition. All over Europe, people are taking back power from the fossil fuel industry by forming local energy communities as a democratic antidote to our energy, poverty, and social issues. Energy communities are initiatives that allow citizens to take control of their energy production and consumption. In practice, solar and wind farms set up in fields or solar panels installed on rooftops are owned by local people which decentralises energy systems. These energy communities not only counter climate change but also bring economic and social benefits. However, despite these benefits, energy communities have only been growing slowly due to the political, economic, and social barriers citizens have been facing during the process of starting their projects, including limited access to finance and a lack of recognition and strategy from national governments in supporting the projects, strict licensing, etc.

What about Energy Demand Reduction?

While there is more or less an agreement amongst political circles around the need for renewable energy supply, one aspect that gets overlooked consistently in the current political focus is energy demand reduction. This is crucial as, ultimately, the cheapest energy Europe will ever get is what it does not use.

Meanwhile, seven out of 10 buildings in the EU are energy inefficient – which means a huge amount of energy is currently being paid for and wasted. According to a new report by E3G, IEEFA, Wuppertal Institut and Neon, if Germany focuses on housing and building decarbonisation now, it can save more gas than the amount new LNG terminals would import. Therefore, we need to improve the energy efficiency of our homes to reduce our energy consumption needs, and this is why energy efficiency and demand reduction need to be at the forefront of the energy revolution.

Looking ahead

From where we stand today, with the mounting crises we’re facing, the fossil-reflex, the pushbacks by conservatives, greenwashed decisions, and many different measures to implement to transition into net-zero, the road ahead might look blurry and full of challenges. However, there is still hope, and it lies in about the ability and willingness to reimagine our energy systems and bring about an energy revolution that repairs profound ecological and social damage and protects the most vulnerable.

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If you are interested in energy issues, you can also read our publication on The Future of Sustainable Energy.

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Coppieters Foundation is financially supported by the European Parliament. The European Parliament is not liable for the content of the conferences, events or the opinions of the authors of our publications.

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