Progress in Energy System Transformation: The Berlin Energy Transition Dialogue
Anthony Froggatt, IGov Team and Senior Research Fellow at Chatham House, 24th April 2018
Taking stock of progress in the transformation of the global energy sector is necessary, to assess the pace of technology deployment; the impact that this is having on current systems; and the challenges ahead.
The 4th Berlin Energy Transition Dialogue (BETD) does just this, but it was also an occasion to assess the geographical breadth of the transformation. With BETD representatives from ninety countries, it is clear that there is now a global interest. Germany may be the home of the Energiewende, but the transformation is now worldwide. Furthermore, this year’s conference was the largest to date and was attended by 2,000 participants, including 30 Ministers and State secretaries.
The BETD is used as a platform to release reports that document the progress of decarbonisation including:
- The International Energy Agency released a report entitled ‘Perspectives for Energy Transition: The Role of Energy Efficiency’. One of the key conclusions of the IEA’s findings is that ‘although end-use energy efficiency alone is not sufficient to meet the temperature goals of the Paris Agreement, it can deliver 35% of the cumulative CO2 savings required by 2050’. However, the rate of energy efficiency improvements is not sufficient to capture these savings, with global energy intensity improving by only 1.7% in 2017 well below the 3% annual average required. The report notes that there needs to be clear long-term government commitment, with well-designed policies, adequate capacity for implementation and sufficient enforcement.
- A joint report from the International Renewable Energy Agency (IRENA), the International Energy Agency (IEA), and the Renewable Energy Policy Network for the 21st Century (REN21), called Renewable Energy Policies in a Time of Transition. The key conclusions of the report are:
- Renewable energy policies must focus on end-use sectors, not just power generation;
- The use of renewables for heating and cooling requires greater policy attention, including dedicated targets, technology mandates, financial incentives, generation-based incentives, and carbon or energy taxes;
- Policies in the transport sector require further development, including integrated policies to decarbonise energy carriers and fuels, vehicles and infrastructure;
- Policies in the power sector must also evolve further to address new challenges.
- Measures are needed to support the integration of variable renewable energy, taking into account the specific characteristics of solar and wind power
- Achieving the energy transition requires holistic policies that consider factors beyond the energy sector itself.
The rock stars of this year’s events were the data firms promoting blockchains and artificial intelligence, as means of increasing system flexibility; valuing and engaging consumers; and enabling decentralised generation and localised distribution. While there remains uncertainty from some of the delegates, as to how far and fast blockchain will be deployed in established systems, there are clearly some important pilots (such as Grid Singularity) and exciting small scale already taking place, including Solshare in Bangladesh.
A message from many of the keynote speeches in the plenary was that energy transformation will require action across sectors and there was recognition on the importance of addressing heat and cooling, with a conference session dedicated to it. Yet, transport and the rise of electric vehicles was not given similar status, given the transformative changes that have occurred in the last year, this was surprising.
The participants and speakers in the BETD were largely optimistic about the falling price of renewable energy arguing that they are already, or will be in the short term, cheaper than fossil fuels. Furthermore, there is recognition that Government policies and targets have been fundamental in driving the transformation to date. However, the transformation is about to get far more complicated, as higher levels of renewables impact upon the fundamentals of the operation of the existing power system while simultaneously seeking to electrify heating and transport.
While clarity is emerging over the need for, and the role of, new technologies to manage this transformation, a reflection from the BETD is that discussions on the scope of the new regulations and governance frameworks needs to be given far greater prominence if the pace and ambition of energy transition is to be met.