The Covid-19 pandemic accelerates the pace of transformation
Expanding the use of clean energy at the expense of oil
The opening of a wind farm for renewable energy in France.
A.F.B.
Biden wants to support green infrastructure plans.
Reuters
The demand for wind and solar energy is expected to increase in the future.
EPA
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The shadow of oil is the driving force for cars, the fuel that feeds wars, the driving energy of the economy, and the commodity influencing geopolitics, but the world is currently on the way to converting to another source of energy.
After the "Covid-19" pandemic affected the global economy earlier this year, demand for oil fell by more than a fifth, and prices collapsed.
Since then, oil prices have seen a volatile recovery, but a return to the pre-pandemic situation is unlikely, as oil producers have had to face the weaknesses of their industry.
As a result, ExxonMobil, for example, exited the Dow Jones Industrial Average after it had been a member of it since 1928. Many oil-producing countries had hoped to secure a price between $ 70 and $ 80 a barrel for the purposes of their budgets, but today they only get 40 Only dollars a barrel.
Oil prices have fallen before, but they are different from today.
As people, governments and investors become more interested in climate change, the clean energy industry is gaining new momentum.
The capital markets have witnessed a remarkable turnaround, with clean energy stocks rising 45% this year.
With interest rates close to zero, politicians are backing green infrastructure plans.
The Democratic presidential candidate, Joe Biden, wants to spend $ 2 trillion removing carbon from the US economy.
The European Union has allocated 30% of the $ 880 billion monitored recovery plan to combat "Covid-19" for climate measures, and the President of the European Commission, Ursula von der Leyen, used the State of the Union speech last week to confirm the European Union's desire to reduce greenhouse gas emissions by a percentage. 55% over 1990 levels in the next decade.
Better than an oil era
It seems that the energy system in the 21st century will be better than the oil age, more human health, more politically stable, and less politically volatile, but this transformation carries great risks.
If this shift is unregulated, it may increase instability in oil-producing countries, and China may focus control of the green supply chain, and the most dangerous thing is that it occurs very slowly.
Today, fossil fuels represent 85% of the world's energy sources, but this source is characterized by accelerating air pollution, as it contributes to two-thirds of greenhouse gas emissions, and pollution resulting from burning fossil fuels kills more than four million people annually, most of them in major cities In the emerging world.
Oil also causes political instability.
For decades, some oil-producing states, such as Venezuela, whose oil provides little incentive to develop their economies, have been overwhelmed by policies of receiving handouts, corruption and cronyism.
In an effort to ensure the security of its oil supplies, the world's major powers competed to influence these countries, not least in the Middle East, where America has about 60,000 troops.
Fossil fuels are also causing economic volatility, as oil markets are hit by an erratic cartel.
The concentration of the world's oil reserves in certain regions makes supplies vulnerable to geopolitical shocks, so it is no wonder that the price has fluctuated by more than 30% during the half year 62 times since 1970.
New energy system
And the picture of a new energy system appears to be emerging. With bold measures taken, supplies of renewable energy, such as solar and wind energy, could rise from 5% today to 25% in 2035, and nearly 50% by 2050. The use of oil and coal will decrease, although cleaner natural gas will remain central, and this structure will ultimately have huge benefits.
Most importantly, this carbon-free energy will limit the causes of uncontrolled climate change, including devastating droughts, famine, floods and mass disruption.
Once these sources are used, they will be more stable politically as well, because the supply will be geographically and technically diversified.
Oil states will try to reform themselves and depend on the taxes they impose on their citizens.
Oil-consuming countries, which previously sought to secure energy by interfering with the politics of oil producers, would instead be interested in organizing the management of their energy industry.
The 21st century system should be less economically volatile.
Electricity prices will not be determined by a few large players, but by competition and incremental gains in efficiency.
Better energy system
However, even as a better energy system emerges, the risks of a bad transition to the new phase loom.
In this regard, two dangers appear to the surface. The first is that an autocratic China could gain temporary influence under the new global energy system, due to its dominance in making key components and developing new technologies.
Today, Chinese companies produce 72% of the world's solar energy units, 69% of lithium-ion batteries, and 45% of wind turbines, and they also control a lot of refining minerals necessary for clean energy, such as cobalt and lithium.
Rather than being an oil-dependent country, the People's Republic of China could become an "electric nation" in the next six months, announcing investments in electric vehicle infrastructure, testing a nuclear plant in Pakistan, and drawing up plans to store cobalt.
China's economic influence depends on how quickly other economies move.
Europe is home to gigantic developers of wind and solar farms, and companies such as Orsted, Enel and Iberdrola are building such projects in the world.
European companies are leading the race to reduce the continent’s emissions as well, and America’s path was affected by the emergence of oil and shale gas, which made it the largest oil producer in the world, with the support of the Republican Party that rejects measures to eliminate carbon. If America behaves well on climate change - for example, A carbon tax and new infrastructure - capital markets, national energy plants, and universities will make it a formidable green power.
The other big risk is the transformation to which the oil-producing countries, which account for 8% of global GDP, and whose population reach nearly 900 million citizens, will undergo.
As demand for oil dwindles, these countries will enter a fierce battle for market share, and those with cheaper and cleaner crude oil will win.
• Chinese companies today produce 72% of the world's solar energy units, 69% of lithium-ion batteries, and 45% of wind turbines. It also controls much of the refining of minerals necessary for clean energy, such as cobalt and lithium.
The picture of the new energy system is emerging. With bold measures taken, supplies of renewable energy such as solar and wind energy could rise from 5% at present to 25% in 2035, and nearly 50% by 2050, and the use of oil will decrease. And coal, although cleaner natural gas will remain central.
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