With COVID-19 pandemic in the world’s kernel, societies have been petrified – first by the health crisis and next, the ensuing economic shocks.
Then comes a highly probable longer-term predicament - a vicious circle that will confront global population with more devastating impact, and that is the worsening jolt of climate change risks especially if policymakers won’t be judicious enough in aligning their ‘economic recovery goals’ within the injunction of the Paris Agreement.
In “Rethinking the 2020s” presentation to Asian journalists, Jeremy Bentham, vice president for Global Business Environment and Head of Shell Scenarios of multinational energy giant Royal Dutch Shell, puts on sharp focus the three précis on how nations may choose to bounce back from the scarring torment of the COVID-19 pandemic.
He outlined that in Shell’s ‘Wave Scenario,’ the response of countries could be focused on the
“repair of the economy,” and environmental concerns will likely receive less attention or even neglect; then on the “Islands scenario”, governments and societies may tend to prioritize their own security and technology choices in meeting energy needs and may still overshoot the timeline and goals of the Paris covenant because decarbonization efforts could come late and slow.
Further, in Shell’s “Sky 1.5 scenario,” the response of nations to the health crisis could be centered on an all-inclusive strategy that appends overall public well-being -- including institutional improvements that will also prudently factor in the environment, hence, there could be accelerated decarbonization efforts integrated in policy agendas.
Surge in energy usage
According to Bentham, “there is always danger that as the world economy recovers, you get that surge in energy use and emissions that is described in the wave scenario,” thus, he noted that if countries will really need to re-calibrate plans and set their sights on ‘net zero emissions’ or carbon neutrality pathways that are well within the Paris Agreement’s grail, then the best bet for government leaders and relevant stakeholders would be to balance policies with the Sky 1.5 scenario or the accelerated decarbonization targets on their energy transition agendas.
Regrettably, the Shell executive qualified that even prior to the wallop of the pandemic, “the world was no longer on track of meeting the Paris ambitions,” and while changes were being enforced by many economies then, they’re still not simply enough to achieve the global warming abatement targets -- at 1.5 degrees C limit.
“If you dig deeper, what you will find is that technology deployments are beginning to pick up the pace with the reduction in the costs of solar and wind technologies, but the policy landscape had not been that much encouraging for rapid deployments of these technologies,” Bentham narrated.
Moving on to a post-Covid milieu, he emphasized that the overall sentiment is to build on ambitions being cast for the 26th United Nations Climate Change Conference of the Parties (COP 26) that will be convened in Scotland by November this year – and this comes with an increasing emphasis for the world on “setting targets for achieving net zero emissions by 2050, or in China’s case by 2060.”
Bentham cautioned though that for these targets to be concretized, “they need to be backed up by specific policies to enable them (net zero emissions goals) and we have to be clear on the number of years on when to achieve them.”
Corollary to that, the Shell executive indicated that policymakers must likewise “recognize achieving those targets in each sector of the economy and to identify both the challenges and opportunities to decarbonization in these segments.”
Fundamentally, Bentham highlighted that each country “will have different approaches and different policies,” with him adding that what’s important is making those policies “well sequenced” and some might even require deeper research and development (R&D) initiatives prior to policy implementations or project installations.
Within the energy lens, he conveyed that some countries may still opt for feed-in-tariffs in the rollout of renewable energy (RE) ventures; accelerate the electrification of transport sectors; and some economies may even settle on broadly based carbon pricing – whether through taxation or trading schemes.
“So you need that kind of sequencing and different types of policies, but with a recognition that these are going to be sector-specific. Hence, there must be sector-specific partnerships amongst businesses that are involved in the sector and partnerships with the public sector in shaping policies that are going to be important,” the Shell executive stressed.
Fuel of the future
‘Transformation’ serves as the anchor of energy policies across countries globally; and along that paragon would be the emergence of what could be regarded as “fuel of the future.”
In Bentham’s assessment, second generation biofuels as well as hydrogen will likely gain traction as future fuels that would be feeding on the world’s energy hunger.
“I do think that you will see – and it’s already becoming established – that liquid biofuels in particular, and also gaseous biogas will be playing a role in these places,” he said.
Nevertheless, Bentham stated that “there are limitations to the amount of vegetation and land available for developing these kinds of fuel,” thus, he emphasized that these are the ‘limiting factors’ that policymakers and societies would have to address relating to targets of wider scale development of biofuels.
In his view, another technology that will have immense potential as ‘fuel of the future’ is hydrogen – which is now the subject of profound R&D initiatives as well as experimental deployments in various parts of the world.
“If you are thinking about decarbonized molecules, then hydrogen is the ultimate technology that can be used as thermal fuel…by now, it plays an important role in being an energy-dense storage that is portable and can be used as a fuel,” he noted.
Hydrogen, Bentham expounded, will complement the evolution of gas as a thermal fuel that will then primarily replace coal as a dominant technology in the power mix of many countries.
“Hydrogen is beginning to play an increasing role, and ultimately, it will be supplementing and substituting gas over time.”
By design, he contended that “hydrogen could be a gas in liquid form, and in some cases, people could be looking at carriers of hydrogen, like ammonia which is potentially a fuel for the marine sector,” with him asserting that this technology is the one that could make possibilities to usher in the world into energy transition goals with more desired outcomes – because it will not just rope in people’s need for survival, but also the economic growth aspirations of nations, and more importantly, ambitions of having more expansive care for the environment.