Rising concerns about energy security are threatening to stall the transition to clean energy. But there’s hope. Siemens Energy CEO Christian Bruch and policy expert Jason Bordoff discuss how climate and energy security can go hand in hand.
Jason Bordoff: Right, this is having ripple effects in many other parts of the world with rolling blackouts in Pakistan and Bangladesh. And coal is at record high levels as well.
Christian Bruch: So, we’re seeing that this trilemma of energy security, affordability and sustainability is closely interlinked, and so far we haven’t taken any deliberate choice in any direction. At the moment, it's neither doing good or bad to the energy transition, but now is a point in time when we have to make the hard choices. Talking is no longer enough.
Jason Bordoff: I think first there needs to be a recognition that this is going to be almost inevitably a somewhat disorderly transition. And we can try to make it as well managed as possible, but the idea that you’d get anywhere close to a goal like net zero by 2050 – which is only 27, 28 years away! – the scale of transition, the scale of the global energy system, the pace of that transition is unprecedented relative to anything we've ever seen in the history of energy. And we’re going to make mistakes along the way.
This is going to be one of the greatest sources of geopolitical risk of the 21st century. But to be clear, not doing it is even a greater risk because of the impacts of climate change, conflict, refugees, migration, flooding.
So, I think that means more not fewer tools to mitigate volatility moving forward. We need new regulatory systems to cope with more intermittent sources of electricity. We are going to need new tools of diplomacy and foreign policy to manage potential geopolitical risks such as who controls the critical minerals supply chain. And we are going to have to manage trade conflict.
I lead an organization with the word policy in its name, the Center on Global Energy Policy. I would not do that if I did not think policy was necessary (we are already seeing governments step in to subsidize or cap the price of energy), but it is certainly not sufficient. We are going to need the technologies, and Siemens Energy is one of the most important companies in the world for that.
Christian Bruch: And the problems are still ahead, and they’ll be so disruptive that we will need a new era of public private partnership: good policy and strong private capital flows, both built on solid plans. Energy infrastructure needs to be comprehensively reborn. But we shouldn’t neglect the demand side, which we can use to counter some of the volatility from generation. Additionally, we need to deal with the massive growth in electricity volume – possibly tripling in two decades. Industrial policies like in the US are needed to trigger the required grid investments and we need to make optimal use of the assets we already have – for example, with gas and nuclear. Every technology must play its part, and efficiency will be vital.
About Christian Bruch
As president, CEO, and Chief Sustainability Officer of Siemens Energy, Christian Bruch defines his purpose energizing society. “We want to ensure all people have equal opportunities to sustainable, reliable, and affordable energy – no matter where they are.”
Daniel Whitaker, based in London, is an economist and journalist who has been following the changes in the renewable energy sector for years. His work has appeared in a number of media outlets, including the Financial Times and The Economist.