The energy transition

The Earth is getting warmer.

In 2023, according to the United Nations World Meteorological Organization, the global annual average temperature was nearly 1.5 degrees Celsius above pre-industrial levels (more precisely, 1.45 ± 0.12 °C).

This is a dramatic figure, because the 2015 Paris Agreement on climate change aims to limit the long-term temperature rise (i.e., the average for a decade, rather than a single year such as 2023) to no more than 1.5 degrees Celsius.

In addition to causing the polar ice caps to melt and sea levels to rise, global warming is causing other types of climate change, like desertification and an increase in extreme weather events such as hurricanes, floods and fires: the distortion of the climate risks causing incalculable damage.

The scientific community is in agreement that this is due to anthropogenic emissions of greenhouse gases into the atmosphere, especially since the Industrial Revolution. The main such gas, carbon dioxide, originates largely from the energy sector (including but not limited to the generation of electricity).

In December 2023, COP28 in Dubai closed with an explicit agreement to put an end to the use of fossil fuels, but it did not set precise targets to phase out nonrenewable energy sources. At the same time, it admitted that the world's countries are not yet on track to meet the goal of containing the global temperature rise to within 1.5° C.

COP28 called on parties to take action on a global scale to triple renewable energy capacity and double progress in energy efficiency by 2030. It also called on them to put forward ambitious emission reduction targets, covering all greenhouse gases (GHGs), economic sectors and categories. This is in line with the 1.5°C limit in the next round of national climate action plans for 2025.

The goal by 2050 is still to achieve so-called Carbon Neutrality, in other words, to reduce and avoid greenhouse emissions by offsetting the remaining emissions through the use of so-called carbon credits.

To achieve this goal, which was enshrined at COP26 in Glasgow, our main tool is the energy transition, i.e., the shift from an energy mix based on fossil fuels to one that produces very limited, if not zero, carbon emissions, based on renewable energy sources. A huge contribution to decarbonization comes from the electrification of consumption, replacing fossil fuel-generated electricity with energy generated from renewable sources, which also makes other sectors like transport cleaner; the digitalization of grids also contributes by improving energy efficiency.

Historically speaking, energy transitions are not new. In the past we have seen huge epoch-marking shifts like the transition from using wood to using coal in the 19^th century or from coal to oil in the 20^th century. But what distinguishes this transition from its predecessors is the urgency of protecting the planet from the greatest threat it has ever had to face, and of doing so as quickly as possible. 

This impetus has accelerated the changes in the energy sector: between 2010 and 2022, according to Irena data, the cost of renewable technologies decreased by 83% in the case of solar PV and 42% in the case of onshore wind.

The energy transition is not, however, only limited to the gradual closure of coal-fired power stations and the development of clean energies: it is a paradigm shift that concerns the entire system.

This solution can provide benefits not only for the climate but also for the economy and for society. 

The digitalization of electricity grids can usher in the age of smart grids and open the way for new services for consumers. From the environmental perspective, renewable sources and electric mobility reduce pollution, while coal-fired power stations can be repurposed in line with the principles of the circular economy. 

Concerning social sustainability, the new jobs created can absorb those people who were previously working in the thermoelectric sector. It is important that the energy transition be inclusive and ensure that no one is left behind.