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How sustainability boosts energy security – WEC

… falling prices making cleaner sustainable technologies more affordable

Boosting the sustainability of energy systems goes hand-in-hand with improving energy security and equity, according to a World Energy Council and Oliver Wyman report.

The global energy system can be made more environmentally sustainable while simultaneously improving energy security, defined by the diversification of sources, and energy equity across nations’ populations, according to research launched Monday this week.

The 2020 World Energy Trilemma Index, created by the World Energy Council (WEC), a network of energy leaders and practitioners, in partnership with consultancy Oliver Wyman, was launched at the WEC’S World Energy Week virtual event.

Improving the sustainability of energy systems is often seen as a cost to the host country, or tradeoff with other factors. “The Trilemma Index actually tends to illustrate that the opposite is true,” says Martin Young, the WEC’S senior director, insights, to Petroleum Economist, based on the results of the 130-country policy development and performance index.

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Energy security is based on the diversity and import dependence of a country’s energy system, among other things. Making that system more sustainable, by increasing its diversity and improving its efficiency, also improves its security. This is demonstrated by the highest overall scoring countries in the Trilemma, which have both high security and sustainability scores.

The energy equity component is based on a more complicated mix of factors, as the Trilemma Index tries to replicate the UN Sustainability Development Goal 7 (UNSDG7) by looking at energy access and cost.

“More diverse energy systems tend to be market-based with efficient pricing, although the lowest prices tend to be subsidised either implicitly or explicitly within concentrated energy systems that are less sustainable,” says Young.

He stated that the poorest countries have focused on improving energy access. This can entail relying on less sustainable energy systems. However, with an increasing uptake of renewables, these can be cost-effective for remote areas and for some grids. “Falling prices are making cleaner sustainable technologies more affordable and developing countries can also learn from the mistakes made by others” Young, World Energy Council.

Cambodia, Myanmar and Kenya improved the most since 2000 in the overall Trilemma, as a result of a focus on energy access, electrification, energy generation diversity, and infrastructure investment.

Some countries can improve sustainability without damaging equity and security but the challenge is not equal for all countries. “National and regional contexts can make this more complicated for some areas than others,” says Young.

Switzerland, Sweden and Denmark are the top three rated countries across all three Trilemma dimensions, having maintained consistent and balanced performance coupled with steady economic and population growth over a number of years.

“OECD countries have been particularly effective, but these richer countries have focused for a number of years on improving energy policies with competitive and diverse energy markets. They have effectively decoupled GDP growth from increased emissions. The UK is a great example of this.

Countries can learn from one another by understanding which energy policies are effective. They can then consider how these policies may work in their own contexts in their search for optimal solutions. While the top environmental sustainability performers in 2020 are Switzerland, Sweden and Norway, somewhat less predictably Azerbaijan and Ukraine have since 2000 significantly improved their sustainability performance by decarbonising their energy systems.

“Cost is a key challenge, with oil producers reliant upon high export prices being particularly affected,” says Young. “These countries are challenged by the current low oil price environment, which makes it more difficult for them to broaden their economies and diversify their energy systems.”

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