As the European Parliament has just voted to ban thermic engines from 2035 onwards, a recent, timely study commissioned by ECR and co-authored by the Latvian Economists Association focuses on various scenarios related to the ecological transition. Despite much rhetoric on the decarbonization of the economy, the report provides food for thought on the broad challenges underpinning the transition itself.
But let us start from the facts, first. As it is well-known, the EU has committed to decarbonize its economy by 2050, by achieving climate neutrality. Against this key objective, currently roughly half of the EU’s energy supply still originates from fossils, including natural gas. While renewables are still a long way from addressing the bulk of the demand for energy, the report notes that all the scenarios assessed tend to include greater efficiency as a way to partly address rising energy demand.
To be clear, decarbonization does not entail, as it is often superficially portrayed in mainstream debates, that fossil fuels would disappear. Indeed, in all the scenarios considered in the report, natural gas would continue to serve as energy source. At the same time, nuclear energy and hydrogen technologies would also be increasingly exploited. Indeed, the report argues, we must rely more on nuclear energy, if we want to burn less gas.
In assessing the energy portfolio, one has to be realistic and acknowledge that new hydropower projects present limited scope. Moreover, prices of materials like polysilicon used in the production of solar panels, have increased dramatically, as have the prices of copper, aluminum and steel. As for green hydrogen, the technology exhibits considerable potential with projections pointing to some increased reliance. That said, however, it does not appear to be reaching maturity in the next few decades. Finally, wind-generated energy would still account for an almost negligible part of the overall energy portfolio.
All in all, the report underscores some unpleasant truths: renewable energy sources cannot meet the bulk of energy demand in the coming decades; natural gas cannot be supplanted as an energy source; and, finally, nuclear energy does have a role in the transition.
The transition, moreover, takes place amidst renewed geopolitical tensions. For instance, curtailing of technology-based exports to China is bound, most likely, to trigger a retaliatory response from Beijing. That response may well set restrictions to their exports of rare earth elements that are key to the ecological transition.
The high importance of preserving our Planet to future generations needs a more informed debate, a more realistic strategy and a less ideological approach.