Energy is an essential resource the entire world depends on. The Russia-Ukraine war has put pressure on the systems we’ve built, we’ve had supply chain issues stemming from the pandemic, the prices of oil and gas have skyrocketed, and we are now more than ever aware of the negative environmental impacts. To combat these important issues, we can and must accelerate the transition of our current energy sources to renewable energy sources, which is why we need new policies and regulations, financial incentives, and the enactment of creative proposals
WHY SHOULD WE DECARBONISE?
Decarbonisation is absolutely essential to fight against climate change. The process of reducing and eventually eliminating the carbon (and other harmful greenhouse gas emission) we put out into the atmosphere is a required step to prevent the planet from warming any further. If we don’t decarbonise, ecosystems around the world are headed down a path that includes horrific and unprecedented disaster. To prevent future catastrophe, death, and disruption, decarbonisation is a non-negotiable first step. Additionally, there is also an attractive financial incentive to do so as the EU would save almost 100 billion euros annually from not importing fossil fuel.
WHAT IS PREVENTING THE EU FROM TRANSITIONING TO RENEWABLES?
Saying this transition is important is one thing, but acting on it is more challenging than it may seem. The current infrastructure of our energy is built on grids that are 100 years old. These were never intended to support or maintain the massive demand and load they carry today. Additionally, governmental policies and regulations are not optimised for a smooth or quick switch to these newer energy sources.
THE PROPOSALS THAT CAN MAKE THE TRANSITION HAPPEN
There are several creative proposals that take advantage of what we know may work. Thankfully, European Commission President Ursula von der Leyen has recently increased the target of renewable energy market share to 45%. Other promises include a 67% share of wind and solar power by 2030, and many large-scale partnerships in development.
One specific promising proposal is to create an institution/agency whose main goal is to remove outdated and obsolete regulations and barriers to change. As with anything that is over a century old, much of what exists currently is outdated and no longer relevant to the state of the world. If this institution were to be created, it could and should identify what is holding governments and societies back from making the change, and work towards facilitating change. Along with removing what is getting in the way of the transition, comes removing the actual amount of fossil fuels being consumed, and investing in the renewable tech of the future.
Another proposal is to develop and enable a map of optimal places for solar to be installed. The map would provide an easy way for companies to opt in and build solar at a faster pace. These places must have a lot of sunlight, but also be placed where solar panels can be installed easily without regular requirements that create hoops to jump through forcing everything to slow down. REPowerEU has already conducted research and identified auspicious areas that could be chosen such as next to train railways or on top of government buildings.
After the drop in solar prices, more and more investments were made in photovoltaics and renewable energy. Over the last decade, the price of solar has decreased by 90%, and by 2026, the price is expected to drop by another 68%, making them even more affordable. One of the most practical and promising ways we can accelerate this transition is through financial incentives. Solar installation costs are increased by taxes which could be removed by government to subsidise this vital industry. Based on the country in which you live, you pay 20-25% VAT when you install solar panels on your roof. The EU imports a lot of solar panels, which is subject to import taxes of 3-5%. The initial investment costs for solar can be reduced by 25-30% just by reducing the taxes. Other renewable energy sources can also benefit from this financial incentive.
COULD RISING ENERGY PRICES BE A GOOD THING FOR EUROPE?
While nobody enjoys paying more for something, rising prices for currently available energy could be a necessary burden to ensure the wider adoption of renewables and ultimately make them more affordable. Looking at households installing solar panel systems on their roofs, the initial price for materials, labor, and installation, will shortly turn into the benefits of much cheaper energy for years to come.
Aside from the important economic benefits, the transition to renewables is absolutely essential. The more harmful greenhouse gas emissions that are released into the atmosphere, the more harm is done to the Earth’s climate. With overall energy production likely accounting for over two-thirds of all emissions, it is one of the most important places we should focus on. By implementing the right policies, enacting the promising proposals that were outlined, and focusing our time and attention on the switch, we can save our wallets, our planet, and ourselves.
About the author:
Filip is a serial entrepreneur and a founder of Energy Shift, a blockchain powered platform that enables citizens to jointly invest in and co-own solar farms. He has previous work experience from a solar installation company, where he became an expert in solar energy. Among his vast experience in the energy sector, he was a Technical Working Group member in the United Nations’ High-Level Dialogue on Energy, providing recommendations on how the World can achieve the SDG7 targets that we set. Furthermore, he advised “Big Oil companies” on how they can transition their business model to sustainable energy. He won the European Sustainable Energy Award in the Young Energy Trailblazer category, awarded by the European Commission in 2021 and was recognised in Forbes 30 under 30 Europe 2022.
Disclaimer: This article is a contribution from a partner. All rights reserved.
Neither the European Commission nor any person acting on behalf of the Commission is responsible for the use that might be made of the information in the article. The opinions expressed are those of the author(s) only and should not be considered as representative of the European Commission’s official position.
- Publication date
- 9 August 2022
- European Climate, Infrastructure and Environment Executive Agency