February 1, 2023

Marco Chown Oved

When Russia launched its invasion of Ukraine last winter, it looked like it would derail the global green energy transition from fossil fuels.

European leaders scrambled to buy up as much natural gas as they could, even restarting shuttered coal plants to make up for the sudden shut off of Russian gas. As oil prices soared, and profits in the oilpatch reached historic highs, leaders from Germany to Japan came to court Canada to increase its liquid natural gas exports.

All of a sudden, fossil fuels had become a key geopolitical resource to ensure “energy security” rather than a leading cause of climate catastrophe, leading some environmentalists to throw up their hands in frustration.

But nearly a year later, the impacts of that illegal invasion are trickling in, and they’re not showing any retreat from renewables. Instead of increasing our reliance on fossil fuels, the war in Ukraine has sped up the global transition to clean energy.

“The EU relied so much on Russian gas, it went into a buying frenzy last year, which led many to believe that it was doubling down on fossil fuels. It wasn’t,” said Dave Jones, head of insights at Ember, a U.K.-based clean energy think-tank.

“We needed some short-term supply, but what was happening behind the scenes was more of a fundamental transition that went into hyperdrive.”

Ember’s research shows that European renewable power surpassed natural gas as a generation source for the first time in 2022, after outstripping coal in 2019.

Last year was also the first year where investments in renewables exceeded those in fossil fuels, according to the International Energy Agency (IEA).

“The fossil fuel energy crisis distracted people from the bigger picture and only now are we coming to realize what a momentous turning point 2022 was,” Jones said.

While oil and gas have long been touted as a way to ensure “energy security,” the spike in prices last year dispelled many of the notion, said Mark Winfield, a professor of environmental studies at York University.

“They learned a very powerful lesson about the risk of relying on an external energy supply,” he said.

Rather than finding new sources of natural gas to ensure energy supplies for coming winters, Europe is weaning itself off the international oil and gas market altogether.

“Energy security will not be a brake, but an accelerator for clean energy transitions as a response to what we are experiencing now. This will be the world’s response to Russia,” said IEA executive director Fatih Birol.

According to another report put out by research firm BloombergNEF, renewable energy investment surged past the $1 trillion (U.S.) mark last year for the first time.

“Our findings put to bed any debate about how the energy crisis will impact clean energy deployment,” said Albert Cheung, head of global analysis at BloombergNEF. “Rather than slowing down, energy transition investment has surged to a new record as countries and businesses continue to execute on transition plans.”

Even BP, one of the world’s biggest oil companies, said demand for fossil fuels is falling faster than predicted.

In its annual energy outlook report, BP projects oil consumption will fall 5 per cent faster and gas demand 6 per cent faster than before the invasion. Those gains will drive down emissions by 3.7 per cent in 2030 and 9.3 per cent in 2050 compared to the company’s previous projections.

“We’re seeing the world moving much faster on the transition to green energy,” said Merran Smith, founder of Clean Energy Canada, a climate program at Simon Fraser University. “Yes, there is still a market for oil and gas, but it’s clearly in decline — and that’s accelerating.”

Beyond electricity, where governments control the markets, consumers drove a shift away from gasoline and natural gas consumption as they switched in record numbers to electric vehicles and heat pumps.

The IEA estimates that 13 per cent of all new car sales in the world were electric in 2022. That’s up from only 3 per cent in 2019. And more than half of those cars were sold in China.

In Canada, we lag, with only 7.7 per cent of new cars being EVs. But much of that is due to a lack of supply and long wait times for EVs.

New federal EV sales mandates, set to take effect this year, could go a long way toward ensuring more EVs are made available for purchase and cut those wait-lists, which are up to two years long.

Sales of electric heat pumps, which replace gas furnaces and boilers, are also soaring in Europe as consumers react to natural gas prices, which more than doubled in some countries.

Global sales of heat pumps grew by nearly 15 per cent, according to the IEA. In Europe, sales doubled in the first half of 2022, after the Russian invasion of Ukraine.

“We’re seeing people acting with a gold rush mentality,” said Smith. “Canada is going to miss out if we don’t leap at this opportunity.”

“Why focus on being the last barrel of oil extracted when we could focus on being the first tank of green hydrogen?”

Originally posted on Toronto Star