Global energy transition stalls, Germany struggles with affordability
World Economic Forum
The global energy transition has stalled, partly because of the continued use of coal power worldwide and slower-than-necessary improvements in energy intensity, according to the 鈥淔ostering Effective Energy Transition鈥� report, (). The report rates economies on their security of energy supply, environmental sustainability, and economic development and growth. Access to energy has improved, the report found, but the world鈥檚 energy systems have become 鈥渓ess affordable鈥� and 鈥渘o more environmentally sustainable鈥� over the last five years.鈥淭hree years after the global milestone of political commitment through the Paris Agreement, this lack of progress provides a reality check,鈥� the authors write, pointing out that global CO2 emissions were expected to rise by more than 2 percent in 2018, 鈥渢he highest in recent times.鈥� Coal consumption increased in 2018, after declining for the previous three years, and investment in fossil fuels as a share of total energy investment grew in 2017 for the first time since 2014.The report鈥檚 Energy Transition Index (ETI), first released last year, ranks 115 countries on the performance of their energy system and readiness for the energy transition. Sweden is ranked first, as it was last year, followed by Switzerland and Norway.
Germany is ranked 17th, down from 16th last year. The report鈥檚 authors note that in general, European countries and other advanced economies rank well on the ETI due to 鈥渨ell-developed and modern energy systems鈥� that offer reliable access and energy security, as well as policies that create a supportive environment for energy transitions. 鈥淭he key challenges for energy transition in these economies relate to affordability and environmental sustainability,鈥� the authors write.
The report鈥檚 authors ranked Germany among the top three countries (with India and the UK) for renewable energy policies, and note that 鈥渢he success of green energy transition鈥� in Germany offers lessons for developing nations. But high retail electricity prices 鈥渉ighlight the complexity of keeping energy prices affordable while investing in energy transition,鈥� the report says. 鈥淩ecent evidence suggests rising electricity prices are affecting households and small business more than large industrial energy consumers, which affects the equity and inclusiveness in sharing the costs of energy transition,鈥� the report adds.
