The energy transition is... in transition

Published on
July 26, 2022
July 21, 2022

In 2017 the energy transition was defined by Professor Vaclav Smile as “the change in the composition (structure) of primary energy supply, the gradual shift from a specific pattern of energy provision to a new state of an energy system.” However, when we speak about energy transition nowadays, most often it refers to the transformation from fossil-based to zero-carbon energy. This transition to zero-carbon is not a luxury but an absolute necessity to limit the impact of climate change. It's all over the news (media), as an example having the highest ocean temperatures in history (ever) recorded last year.

On a positive note, commitments towards energy transition in (multinational) companies has never been greater. 21% of the 2,000 biggest companies* in the world are committed to net zero targets. And while governments are expected to lead such initiatives, private companies in several instances are more ambitious about decarbonizing their products or services.

But...it's not about words, it's all about action!

Employee attitudes towards energy transition are also taking a positive turn. In a study by Deloitte and Reuters** more than 64% of respondents stated that energy transition commitments play a major role in whether they would work for a company. That's a staggering number, climate impact as a driver for new hires + employee retention.

Promises are great, but what do we have to do to make real change? One of the key drivers is electrification, being the biggest and most obvious enabler. As an example, full electrification of U.S. transportation, and commercial + residential sectors would reduce greenhouse gases by 70 percent.**

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Need for electric speed

Transport is contributing massively to global warming. Worldwide, transport is accountable for 16% of greenhouse gas emissions***. In the largest three "car" markets, these numbers are significantly higher. As an example, China transport makes up 25% of emissions, in Europe it’s 27% and in the United States it's even higher with 29%! The pandemic created a drop in these numbers, but we are already starting to see getting back to pre-pandemic levels.

The need for drastic change in the transport sector is high, together with hydrogen and solar. Some weeks ago we met the Head of Strategy of one of largest Ports (+ ecosystem) in the world and they are doubling down on hydrogen terminals + several MoUs with large players globally.

Fortunately, after a somewhat slow start the electric vehicle revolution is picking up speed. Many brands have brought their electric models to the market and automakers have announced another $526 billion collective investment through 2026. This is double the amount they planned a few years ago.

The big question remains is sales of electric cars will increase as much as projected. It’s like swapping from an old Nokia to the new iPhone without all the extra features and possibilities. Additionally charging an electric vehicle is not yet as fast and easy as filling up your tank with gas. Especially on long trips, finding a charger can still be challenging.

However, worldwide EV sales in 2021 doubled the amount of 2020 and keep rising consistently into 2022****. Norway, the leader in electric vehicles (adoption) sales closed of 2021 with 90% sales of EV in the month of December, which leaves (yes, we know you can count, but we want to amplify our enthusiasm) only 10% for other types of cars!*****

The Netherlands have the second highest market share, but remarkable enough one of the lowest charger to EV ratio (albeit density of country could be the explanation?)

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A latte convenience... Fortune 500 companies seeing opportunities

A coffee, a breakfast, and a charged car. Starbucks is here to add more comfort to our electrical car charging experience. With 15,000 locations in the US, Starbucks envisions itself to be the perfect location to charge your vehicle. (Meanwhile charging yourself with a big cup of coffee along the process...)

The coffee giant has partnered with Volvo and Chargepoint this year for a pilot to install charge points in parking lots of Starbucks locations on route between Denver and Seattle. Based on the results of this pilot Starbucks will ultimately decide if it wants to roll this out across the country. It's part of the company’s goal to be resource positive and capture more carbon than emitting.

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* https://www2.deloitte.com/content/dam/Deloitte/uk/Documents/energy-resources/deloitte-uk-global-energy-transition-trends-2022.pdf

**https://www.eesi.org/electrification/be

*** https://www.woodmac.com/news/opinion/evs-the-biggest-lever-in-driving-the-energy-transition/

**** https://www.iea.org/data-and-statistics/data-product/global-ev-outlook-2022

***** https://insideevs.com/news/558447/norway-plugin-car-sales-december2021/

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