If you have been reading about the success of solar energy and how renewable energy is going to replace coal, then the recent news of the coal shortage and the impending global energy crisis might baffle you. For the last 2-3 weeks the newspapers have been highlighting how we are running out of coal and gas for our power plants and there might be blackouts. And, this is not an Indian problem only, right now the energy crisis is global. Post-pandemic the economy is getting back on its normal track and the energy demand is up and so are the prices of gas (the European gas prices are up by 600%)and coal.
You have a look at the global energy mix and you will know that renewable energy is nowhere close to being the main source of our energy. More than 60% of electricity still comes from fossil fuels and more than 83% of our primary energy need is met by fossil fuel sources (Statistical Review of World Energy, 2021). In India, 70% of our electricity still comes from coal power plants. A renewable energy-powered world is still a distant dream.
Over the last decade, the technical and commercial feasibility of renewable energy has changed exponentially. There is also an overwhelming commitment from the governments and corporates to move toward renewable and clean power. Yet, these commitments are not translating into the required investments for these transitions. If we are going to meet our Paris Agreement 1.5 degree scenario, overall we are looking at USD 131 trillion investment by 2050 in energy transition, which includes USD 34 trillion in renewable energy (World Energy Transition Outlook 2021).
If we look at the current status of investment in renewable energy we have a lot of catch-up to do. In 2020, we had USD 524 billion investment in renewable energy and we anticipate around USD 750 billion in 2021.
I hope that with these blackouts and energy crisis, the policy makers are getting a reminder that their commitment need to be backed up enabling policy environment and significant push on the investment in the renewables. In absence of proper planning and investment roadmap in renewable energy ecosystem, the energy transition can be a painful experience.