Indonesia encourages oil and gas companies to develop carbon storage: Here's what you need to know about the global energy transition this week
- This weekly round-up brings you the latest developments in the global energy sector.
- Top energy news: Indonesia asks oil and gas companies to look to carbon storage; EU agrees energy consumption targets; Iran announces huge lithium discovery.
- 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. Indonesia looks to carbon storage to help reduce emissions
Oil and gas companies operating in Indonesia are being urged to install carbon capture facilities. The resource-rich country is one of the world’s biggest emitters of greenhouse gases.
The country’s energy ministry has issued new regulations aimed at lowering emissions while boosting declining oil and gas output. However, this doesn't make it mandatory for companies to install carbon capture, storage and utilization (CCUS) facilities.
"Indonesia has geological formations that can be used to store carbon emissions permanently through the use of technology," the ministry says, adding that companies should put forward detailed proposals for government approval. The carbon injected into their reservoirs could come from the oil and gas industry as well as other industries, the regulation states.
Indonesian authorities have so far approved one CCUS project at BP's Tangguh LNG facility in West Papua province. Indonesia's state energy firm Pertamina has also conducted several studies on CCUS with partners including ExxonMobil and Mitsui.
What's the World Economic Forum doing about the transition to clean energy?
Moving to clean energy is key to combating climate change, yet in the past five years, the energy transition has stagnated.
Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago. Plus, improvements in the energy intensity of the global economy (the amount of energy used per unit of economic activity) are slowing. In 2018 energy intensity improved by 1.2%, the slowest rate since 2010.
Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.
Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.
To future-proof the global energy system, the Forum’s Shaping the Future of Energy and Materials Platform is working on initiatives including, Systemic Efficiency, Innovation and Clean Energy and the Global Battery Alliance to encourage and enable innovative energy investments, technologies and solutions.
Additionally, the Mission Possible Platform (MPP) is working to assemble public and private partners to further the industry transition to set heavy industry and mobility sectors on the pathway towards net-zero emissions. MPP is an initiative created by the World Economic Forum and the Energy Transitions Commission.
Is your organisation interested in working with the World Economic Forum? Find out more here.
2. Australia ramps up investment in renewables
Investment in large-scale clean energy projects in Australia increased towards the end of last year to its highest level in four years, a report by industry body the Clean Energy Council says. A total of A$4.3 billion ($2.8 billion) was invested in renewable generation and storage projects in the final quarter of 2022, while annual investment rose 17% from the year before.
However, the report warns that Australia is lagging in deploying new wind and solar farms. It says this could impact the government's plans to grow the share of renewable energy in the national power grid to 82% by 2030 from about 30% now. "While the uptick is encouraging, one quarter doesn't mean a trend," the council's Chief Executive, Kane Thornton, says. "The current policy settings are only going to get us so far."
Last month, the national energy market operator warned that Australia's east could face the risk of power blackouts from the middle of the decade. It said renewable energy projects need to be ramped up as the country reduces coal-fired power generation.
Australia's government has pledged to invest A$20 billion ($13 billion) to rebuild and modernize the national electricity network. It aims to cut carbon emissions by 43% by 2030 and reach net zero by 2050.
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3. News in brief: More energy stories from around the world
The European Union has agreed a deal to cut final energy consumption across the bloc by 11.7% by 2030. Hitting the targets will require countries to renovate millions of badly insulated buildings to waste less energy.
Malaysia will need to double its investments in the renewable energy transition to achieve its goal of carbon neutrality by 2050, according to the International Renewable Energy Agency. It says the country needs investment of between $375 billion and $415 billion to expand renewables capacity, infrastructure and energy efficiency.
Iran says it has discovered a huge deposit of lithium – a metal used in electronic vehicles and many modern technologies. If accurate, the estimated 8.5 million ton deposit would give Iran the largest lithium reserves outside South America.
German Chancellor Olaf Scholz says the country will build new gas-fired power plants to be operated with hydrogen. Europe's biggest economy is looking to boost its renewable energy sources and become less reliant on fossil fuel imports.
India’s power generators and coal mines are being stretched to the limit to meet surging power demand stemming from a fast-growing economy and rapid electrification. A massive deployment of renewable generation has helped prevent far worse shortages, with capacity rising by 15% in January from a year earlier.
New solar installations in the US dropped 16% in 2022 from the year before, largely because a ban on some Chinese goods limited the availability of panels. However, installations are expected to rebound in 2023, according to a new industry report.
China's state planner has emphasized a greater role for coal in its power supply, saying the fossil fuel would be used to improve the reliability and security of its energy system. Fluctuating output from renewable plants has led policy-makers to use coal power to shore up the country's baseload supply.
Uganda expects to start generating at least 1,000 megawatts from nuclear power by 2031. The country is looking to diversify its sources of electricity and accelerate its energy transition.
Saudi Arabia's ACWA Power will build two solar plants in Uzbekistan, the country's energy ministry says. Uzbekistan has signed deals for a number of renewable energy projects in recent years.
The world’s first offshore " artificial energy island" is planned to be built off the coast of Belgium, Electrek reports. The floating electricity grid will connect offshore windfarms to the European mainland.
4. More on energy from Agenda
Power capacity from clean energy sources comprised a record 40.6% of the US electricity mix in 2022, according to a new report. It says sales of electric vehicles also rose by 50% in the US last year.
Hydrogen is often touted as a renewable energy lifeline for some hard-to-abate heavy industries. Different colours are used to label different types of hydrogen, but what do they all mean?
The energy challenge that the Russia-Ukraine war has caused in developing countries has intensified global discussions about climate justice. A global energy policy analyst explains more.
To learn more about the work of the Energy, Materials, Infrastructure Platform, contact Ella Yutong Lin: firstname.lastname@example.org