Energy Transition

The global energy crisis ‘could speed up the green transition’: What you need to know about energy this week

Top energy stories: Energy prices expected to fall in 2023; Italy plans to double gas production; Could the global energy crisis speed up the green transition?

Top energy stories: Energy prices expected to fall in 2023; Italy plans to double gas production; Could the global energy crisis speed up the green transition? Image: Unsplash/Sungrow EMEA

Roberto Bocca
Head of Centre for Energy and Materials; Member of the Executive Committee, World Economic Forum
Stefan Ellerbeck
Senior Writer, Forum Agenda
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Energy Transition

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  • This weekly round-up brings you the latest on developments in the global energy sector.
  • Top energy stories: Energy prices expected to fall in 2023; Italy plans to double gas production; Could the global energy crisis speed up the green transition?
  • For more on the World Economic Forum’s work in the energy space, visit the Shaping the Future of Energy, Materials and Infrastructure Platform.

1. News in brief: Energy stories from around the world

The World Bank expects energy prices to decline by 11% in 2023 after this year's 60% surge following Russia's invasion of Ukraine. However, slower global growth and COVID-19 restrictions in China could lead to a deeper fall, it says. The bank projects an average Brent crude price of $92 a barrel in 2023, easing to $80 in 2024 – but this is still well above the five-year average of $60.

Asia has surpassed Russia as the biggest supplier of oil products to the EU, according to shipping organization BIMCO. It says 4.4 million tonnes were delivered to the bloc from Asia in October. “The increase in clean oil product imports from Asia to the EU have more than replaced lost volumes from Russia,” says BIMCO’s Chief Analyst, Niels Rasmussen.

The EU’s gas use fell dramatically in August and September as industries cut production in response to soaring prices and scarce Russian supplies. Usage dropped by 14% in August and by 15% in September compared with the five-year averages for these months, according to EU statistics office Eurostat.

China's strict COVID-19 policy is constraining coal supplies and pushing up prices, according to Reuters. The world's top coal consumer still relies on the fuel to heat homes across much of its colder northern regions, and Beijing is determined to ensure sufficient supplies this year after shortages led to unprecedented power outages in 2021.

Italy plans to double its national gas production to 6 billion cubic metres (bcm) per year in a further effort to cut its dependence on Russian supplies. The newly elected government will also authorize new offshore drilling in the Adriatic Sea as part of plans to become “the energy hub of the Mediterranean”, Industry Minister Adolfo Urso said.

Germany is looking for help from Brussels to revive its solar panel industry and improve the EU’s energy security. Once the world's leader in installed solar power capacity, Germany's solar manufacturing collapsed after a government decision a decade ago to cut subsidies for the industry.

Europe's two largest energy companies, Shell and TotalEnergies, each reported profits of more than $9 billion in the third quarter. The strong earnings are likely to intensify calls in Britain and the European Union for further windfall taxes on energy companies to help households cope with soaring power bills, Reuters says.

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2. Global energy crisis could hasten green transition, the IEA says

The drop in Russian fossil fuel exports following its invasion of Ukraine will transform the global energy landscape for decades and can help speed up the green energy transition, according to the International Energy Agency (IEA).

"The energy world is shifting dramatically before our eyes,” IEA Executive Director Fatih Birol says. “Government responses around the world promise to make this an historic and definitive turning point towards a cleaner, more affordable and more secure energy system.”

global energy crisis clean energy investment
Global clean energy investment is set to rise above more than $2 trillion per year by 2030. Image: IEA

The IEA's annual World Energy Outlook report has a “Stated Policies Scenario” that shows the trajectory implied by current government plans. This puts global clean energy investment on track to rise to more than $2 trillion a year by 2030, up by 50% from current levels. While this is a sign of progress, the organization says significantly more funding will still be needed to reach the required $4 trillion of annual investment laid out in its “Net Zero Emissions by 2050” scenario.

The agency also says Russia will never regain the share of the global energy supply mix it had before its war on Ukraine. It predicts Moscow’s supply of internationally traded energy will fall to 13% by 2030 from about 20% in 2021. The IEA also says global demand for every type of fossil fuel is set to peak or plateau for the first time in the agency's history of modelling.

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How is the World Economic Forum facilitating the transition to clean energy?

3. India’s Russian oil imports soar

India has been increasing its oil imports from Russia – so much so that they made up 23% of the country’s total oil intake in September, their highest ever share. India is also now Russia’s second-biggest oil customer after China.

The shift is a result of India benefiting from discounted prices for Russian oil, after Moscow lost some of its Western customers because of its war on Ukraine.

"The discount on Russian oil has narrowed now but when you compare its landed cost with other grades such as those from the Middle East, Russian oil turned out to be cheaper," a source at one of India's state refiners told Reuters.

India’s oil imports from the Middle East consequently fell to a 19-month low last month. Iraq remained the top supplier while Russia overtook Saudi Arabia as the second-biggest provider.

India's monthly oil imports global energy crisis
Russian oil is making up a bigger share of India’s imports than ever before. Image: Reuters

4. More on energy from Agenda

Global nuclear power generation rose by 3.9% in 2021, a new report from the World Nuclear Industry says. A total of 411 reactors are operational around the world – 26 fewer than just over a decade earlier. Statista’s Katharina Buchholz takes a look at the latest data around current trends in nuclear power generation.

With the energy crisis raising bills for millions of people around the world, families are turning to other forms of cooking that use less energy. Amin Al-Habaibeh, Professor of Intelligent Engineering Systems at Nottingham Trent University, has been conducting some experiments to find out how different cooking methods compare.

Heating, ventilation and cooling systems make up approximately half of buildings’ energy consumption. Enerbrain’s Iacopo Predieri asks how we can heat as well as cool buildings more efficiently and effectively.

To learn more about the work of the Energy, Materials, Infrastructure Platform, contact Anne Therese Andersen: AnneTherese.Andersen@weforum.org

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