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Global electricity production continues to rise – IEA


Worldwide Climate change The latest International Energy Agency Monthly Electricity Statistics report, which includes November 2021 data, shows that the total production of all member states of the Organisation for Economic Co-operation and Development is still rising.


Total net electricity production was 868.2 TWh in November 2021, up by 1.4% compared to October 2021 and up by 3.7% compared to November 2020. From January to November 2021, total net electricity power production was 9784.8 TWh, up by 3.4% compared to the same period in 2020.


Total renewable electricity production was 268.0 TWh in November 2021, an increase of 3.1% compared to November 2020, and mostly stable compared to October 2021 (-0.6%). The share of total renewable electricity in the electricity mix was 30.9% in November 2021. Combustible fuel power production was 475.4 TWh in November 2021, up by 2.6% compared to October 2021 and up by 4.9% compared to November 2020, with a share of 54.8% in the electricity mix. Natural gas power production rebounded in November 2021, with 260.0 TWh production, an increase of 2.3% compared to the previous month, and


8.0% on a year-on-year basis.


The most striking changes were exhibited by renewables generation in Australia, where November 2021 was abnormally wet and cloudy. There was a drop in solar power production to 2.8 TWh, a 7.3% fall month-over-month. Despite growing solar installed capacity, this represented a decrease of 2.5% compared to November 2020. However, the climate conditions were beneficial to wind and hydro power production. Hydropower production was 1.4 TWh, representing a 37.9% increase from the same month in 2020, while wind power production was 2.2 TWh, up by 12.8% (year-on-year).


Conflict adds impetus to Asia’s energy transition Asia Energy policy


The invasion of Ukraine is leading to further turmoil for global energy markets already badly affected by extreme price volatility over the past two years. Oil prices have now passed US$100 per barrel for the first time since 2014, while other commodities like liquefied natural gas (LNG) – which has recently seen record low prices followed by record highs – are set to experience continued volatility. For Asian economies dependent on imported fossil fuels, volatility since 2020 has caused fuel shortages, government subsidy burdens, inflation, food scarcity, and political instability. The invasion is likely to exacerbate commodity price volatility, undermining economic growth and recovery from COVID-19. Natural gas and coal are often pitched as more reliable fuels for power generation than renewables. As a result, many Asian countries continue to support new fossil fuel infrastructure. Now, advancing alternative technologies to bolster energy security is seen as a viable alternative that is free from geopolitical interference and contributes to


both long-term climate and financial stability. There are three immediate implications of the Russia-Ukraine crisis on Asian economies. First, global energy prices will likely remain high and volatile for the near term. Prices were already widely expected to remain elevated in 2022, due primarily to the economic rebound.. LNG prices, for example, were already susceptible to upward pressure due to interregional competition for cargoes between Asia and Europe, low European storage levels, limited piped exports from Russia to Europe, and harsh weather during the 2021-22 winter. The second implication of the crisis is that continued commodity price volatility will continue to wreak havoc on national efforts to recover from the COVID-19 pandemic. Specifically, high-priced imports are raising consumer power prices and stoking fears about future fuel shortages in the region. As a result of exorbitant LNG prices, proposed and existing gas assets in Asia may go under- utilised and risk becoming stranded assets. The third implication of the conflict is that fossil fuel companies are likely to argue that the


world needs more fossil fuel infrastructure, not less. In the wake of the invasion, Japan’s JERA announced a partnership with ExxonMobil to build a new LNG import facility in Vietnam, Australia said it would target emerging LNG importers in Asia, and Pakistan’s hopes to build a north-south LNG pipeline.


However, two lessons from the conflict should be clear. First, energy insecurity and volatility are part and parcel of global fossil fuel markets. Myriad factors can affect commodity prices, including geopolitical conflicts, pandemics, outages at export infrastructure, and even ships getting stuck in major shipping routes. Such unexpected occurrences can trigger nationwide energy shortages. Therefore, the continued build-out of LNG and other fossil fuel import infrastructure will only reinforce existing vulnerabilities. The second lesson is that low-cost, domestic renewables represent a crucial hedge against the volatility of globally traded fossil fuels because renewables like wind and solar do not require fuel inputs, and have demonstrated consistently lower and stable costs over time.


Germany to spend $220 bn on industrial transformation by 2026


Germany Energy transition Germany has earmarked 200 billion euros ($220 billion) to fund an industrial transformation between now and 2026, including climate protection, hydrogen technology and expansion of the electric vehicle charging network, its finance minister Christian Lindner announced on 16 February. The €200 billion in funding is for the


transformation of the economy, society and the state, said Lindner, adding that this also included the removal of renewable energy levies. This is an intensification of the country’s efforts to cut reliance on Russian gas by boosting infrastructure to import liquefied natural gas (LNG) and possibly relying more on coal-fired power plants. At the same time, Germany is planning to boost investment in


6 | March 2022 | www.modernpowersystems.com


renewables for energy production. Economy minister Robert Habeck said, in an interview with Reuters: “More urgently than ever, we need to invest in our energy sovereignty. And I am glad that we as members of the coalition are pulling in the same direction. Now we must make every effort to become more independent and climate- neutral.”


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