Ensuring resilient energy transition needs to be top-priority: WEF study

The new special edition report by WEF listed key recommendations for governments, companies, consumers and other stakeholders on how to progress the energy transition

A new study by the World Economic Forum (WEF) has called for urgent action by both private and public sectors to ensure a resilient energy transition to address the challenges to environmental sustainability, energy security and energy justice and affordability.

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The pace of energy transition needs to be supercharged, as demonstrated by recent spike in fuel prices and challenges to energy security, the WEF said in its report "Fostering Effective Energy Transition 2022".

According to the report, the urgency for countries to accelerate a holistic energy transition is reinforced by high fuel prices, commodities' shortages, insufficient headway on achieving the climate goals and slow progress on energy justice and access.

An annual country benchmarking report, the new special edition report also listed key recommendations for governments, companies, consumers and other stakeholders on how to push the energy transition.

"Prioritising a resilient energy transition and diversification of the energy mix is crucial in responding to energy market volatility," the WEF study said.

The report notes that more countries need to make binding climate commitments, create long-term visions for domestic and regional energy systems, attract private sector investors for decarbonisation projects and help consumers and the workforce adjust.

"Countries are at risk of future events compounding the disruption of their energy supply chain at a time when the window to prevent the worst consequences of climate change is closing fast," said Roberto Bocca, Head of Energy, Materials and Infrastructure, WEF.

"While there are difficult decisions to be taken to align the imperatives of energy security, sustainability and affordability in the short term, now is the time to double down on action," Bocca added.

The report also pointed out structural barriers to balancing energy affordability, security and availability with sustainability, saying it was due to compounded shocks to the energy system from a post-pandemic surge in energy demand, fuel supply bottlenecks, inflationary pressures and reconfigured energy supply chains as a result of the war in Ukraine.

“The current energy crisis reveals just how important energy is to people and the economy,” said Espen Mehlum, Head of Energy, Materials and Infrastructure Programme for Benchmarking, WEF.

To navigate this challenging situation, countries must pursue diversification on two fronts - not only in the domestic energy mix in the long term but also in considering their fuels and energy suppliers in the shorter term, the WEF said.

The report noted that of 34 countries with advanced economies, 11 rely on only three trade partners for over 70 per cent of their fuel imports.