burning desert

“It is time to act – no excuses”

Christian Bruch, CEO of Siemens Energy, on what needs to happen at COP27

“Together for Implementation. Just and ambitious” – this is the motto of COP 27. In Sharm El-Sheik, representatives from more than 200 countries currently discuss concrete measures to successfully shape the energy transition. We need nothing less than an immediate, overwhelming, and coordinated global effort to avert the worst impacts of climate change – in all regions of the world and all sectors. Five actions are essential.

By Christian Bruch

This week, one year after Glasgow, the world is meeting for another climate summit in Sharm El-Sheikh, Egypt. And the situation could not be more pressing. Unfortunately, the world is a long way from the decade of implementation proclaimed in Scotland – on the contrary, 2021 ended with the highest GHG emissions ever measured worldwide. Global energy demand is growing exponentially as well. Furthermore, energy markets and policies have changed due to the Russian invasion of Ukraine, not just for the time being but for decades to come.

 

In short: Together for Implementation. Just and Ambitious – the motto of this year’s COP27 conference in Sharm el-Sheikh could not be timelier and more precise because action is needed more urgently than ever. 

But COP27 needs to deliver much more than just words, because time is running out.

We have less than a decade to stop the irreversible effects on our planet. We need to act now to achieve rapid change. And the action taken needs to benefit everyone in society. The recent IPCC report has made it abundantly clear: Without significant changes, global warming will increase to 3.2 °C. We need to cut emissions by 45 percent by 2030, compared with 2019 levels, to limit warming to 1.5 °C.

 

The good news, as the just-released World Energy Outlook notes, is that something is moving. Governments around the world are acting – taking longer-term measures to protect consumers from the effects of the crisis. Some are trying to increase or diversify energy supplies, and many are trying to accelerate structural change. Among the most notable activities are the Inflation Reduction Act in the United States, the Fit for 55 program and REPowerEU in the EU, Japan’s Green Transformation (GX) program, South Korea’s goal to increase the share of nuclear and renewables in its energy mix, and ambitious clean energy goals in China and India. Overall, global clean energy investment is expected to exceed $2 trillion by 2030. That’s an increase of more than 50% compared with today. It is definitely the right direction. But it is not enough.

 

We need nothing less than an immediate, overwhelming, and coordinated global effort to stave off the worst impacts of climate change – in all regions of the world and throughout all sectors. We need to balance the energy triangle of affordability, reliability and security. Each country has different challenges and target positions, so it needs other answers to drive the energy transition. There is no one-size-fits-all solution. However, there are five points that we can consider as unifying elements.

Approach to energy transition – 5 points of consistency 

1.     Accelerate renewables: For the energy transition to succeed, the use of renewable energies must be massively increased worldwide. By 2050, the share of renewable energies in the United States needs to triple at the very least. The Asia-Pacific region will have to increase its share by four times to 10 times compared with 2020 – by comparison in Europe, we assume a three- to fourfold increase. Such gains can be achieved only if the framework conditions are right, regulatory barriers are lowered, and, in particular, access to enormous quantities of materials is guaranteed. After all, we know that the material intensity per installed kW is significantly higher compared with conventional technologies.

2.     Improve energy efficiency: Unfortunately, the continuous increase in energy demand due to economic growth and population increase counteracts all current efforts to reduce emissions. Therefore, the first and most important task is to conserve energy wherever possible. This effort will also require greater electrification of industrial processes and transport. Electrification of today’s transport sector would roughly double global electricity production.

3.     Strengthen the electrical grid: The increasing share of renewable energy and increasing electrification require more robust grids – grids that will not only serve an entire country’s needs, but will also link supply and demand within a region or across regions. Germany will need to add up to 4,700 miles of transmission lines and the United States up to 600,000 miles of them. For developing countries, however, this is an even greater challenge. In Africa, many power systems are still known for their frequent outages and grid instabilities – nearly 25% of households in Africa that have access to electricity have power available to them only half of the time, occasionally or never.

4.     Use the existing infrastructure as a bridge: Amid all of the massive investments we all need to make, we cannot and should not overlook one fact: The existing infrastructure can and should be used – even if it is based on conventional technologies – to bridge the gap. We will also have to gradually transition away from this technology to lower CO2 intensity.

5.     Get a handle on the supply chain and the necessary minerals: More materials and minerals are needed for the energy transition. A typical electric car requires six times the mineral inputs of a conventional vehicle, and an onshore wind plant requires nine times more mineral resources than a gas-fired plant. Since 2010, the average amount of minerals needed for a new unit of power generation capacity has increased by 50% as the share of renewables in new investments has risen. 

The energy transition is complex – but essential

To make the energy transition a success, I would like to highlight three additional points: First, as far as possible, we need a transparent, forward-looking plan for all regions.

Second, we need to balance global and local supply chains and factories.

And third, huge funding is required globally to fulfill the commitments of the Paris Climate Agreement.

 

After all, climate change is a global issue, temperatures will not stop rising in Berlin or Washington if emissions do not fall in New Delhi. More than two-thirds of global CO2 emissions come from emerging and developing countries. The trick will be to sustainably promote economic growth in these countries by deploying our technologies, providing financial support, and promoting the local workforce.

The job of combating climate change and systematically advancing the energy transition is a joint task that requires new thinking and action. 

We need a new era of public-private partnerships. That’s why IRENA and Siemens Energy initiated the Alliance for Industry Decarbonization to achieve country-specific net-zero goals, foster the decarbonization of industrial value chains and enhance understanding of renewable-based solutions and their adoption by industry. The Alliance will also work to strengthen dialogue and coordinate action by industrial stakeholders throughout the public and private sectors. We believe one thing in particular: A multi-stakeholder platform fostering such discussions and collaboration can accelerate global action. On November 11, the representatives of 22 companies will meet in Sharm-El-Sheikh to discuss and commit themselves to a clear strategy for execution and implementation. We need clear action.

 

I would like to close on a positive note: The energy transition is the biggest investment program since the dawn of industrialization. If governments, business and society work together, energy transition is a massive opportunity. There is no excuse for waiting any longer. I am looking forward to some high-impact days in Egypt.

 

About the author: Christian Bruch is President and Chief Executive Officer of Siemens Energy AG, one of the world’s leading energy technology companies. The company works with its customers and partners on energy systems for the future, thus supporting the transition to a more sustainable world.

November, 2022

Combined picture and video credits: Siemens Energy; iStock Photo