According to Angela Wilkinson, CEO of the World Energy Council, the world’s energy system is no longer suitable for its intended purpose, signaling a lack of progress towards a green energy transition. The council‘s recent Energy Pulse report reveals that by 2050, about half of the global energy system is projected to remain non-electrified, posing a challenge to governments’ net-zero commitments. Wilkinson expressed concerns shared by 64% of global energy leaders that the pace of change is insufficient to meet the goals outlined in the Paris Agreement.
The sluggish transition to sustainable energy can be attributed to pre-existing strains on energy capacities and security, exacerbated by the COVID-19 pandemic. Global energy markets have faced additional setbacks such as geopolitical tensions and economic recessions. The challenge lies in simultaneously expanding the energy system to meet growing demand while expediting decarbonization efforts.
Carbon taxes have been proposed as a tool to drive the transition to net zero by incentivizing the shift from fossil fuels to low-emission alternatives. However, implementing a global carbon tax is deemed unfeasible due to the complexity of administering it across diverse economies with varying regulations and subsidies. Despite this, Wilkinson emphasized the importance of a price signaling mechanism to reflect the cost of carbon for investors and consumers, highlighting the need to bear the societal cost of carbon emissions.
To achieve the goals of the Paris Agreement and facilitate an effective green energy transition, concerted efforts are required to accelerate the pace of change and address the complexities and challenges inherent in the energy system. Collaboration between governments, industries, and societies will be crucial in charting a sustainable and resilient path forward.
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