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Current World Electricity Grids Too Weak to Sustain Energy Transition, IEA Warns

CRISIS - Atmospheric CO2 Levels by Martina Igini Global Commons Oct 20th 20233 mins
Current World Electricity Grids Too Weak to Sustain Energy Transition, IEA Warns

The Agency said that the world must add or replace about 80 million kilometres of electricity grids by 2040 to meet national climate goals and support energy transition.

Reaching national climate targets and putting the world on track to net zero emissions by 2050 will require huge efforts in improving global electricity grids which, in their current state, are not deemed suitable to support the energy transition, a new study has suggested.

In a first-of-its-kind, country-by-country analysis on the state of the world’s electricity grids published Tuesday, the International Energy Agency (IEA) said major investments were needed to upgrade what is considered the “backbone of today’s electricity systems.” According to the Agency, approximately 80 million kilometres (50 million miles) of electricity grids worldwide need to be added or refurbished by 2040, the rough equivalent of doubling the entire existing global power infrastructure.

The report also encourages countries to double annual investments in electricity grids – which the IEA says have been stagnant for over a decade – to more than US$600 billion each year by 2030. According to the study, delays in grid reform would lead to a “substantial” increase in carbon dioxide emissions, slowing down the energy transition and effectively putting the Paris Agreement goal out of reach. 

Earlier this week, the Biden administration announced $3.5 billion for 58 projects across 44 states to improve the resilience of the country’s ageing electric grid, as increasingly frequent and powerful extreme weather events are contributing to their rapid deterioration. 

“Much of [the grid] was built nearly a century ago. We need it to be bigger, we need it to be stronger, we need it to be smarter,” said Energy Secretary Jennifer Granholm, who announced the plan on Wednesday, calling it “the largest investment into national grid infrastructure in history.”

More on the topic: Texas Energy Crisis: Why Is the State’s Power Grid So Fragile?

According to the IEA, at least 3,000 gigawatts worth of renewable projects worldwide, an amount five times higher than the total solar PV and wind capacity added globally in 2022, are currently waiting to be connected to the grid.

“The recent clean energy progress we have seen in many countries is unprecedented and cause for optimism, but it could be put in jeopardy if governments and businesses do not come together to ensure the world’s electricity grids are ready for the new global energy economy that is rapidly emerging,” said Fatih Birol, IEA Executive Director.

The report emphasises the importance of governmental backing for the growth of supply chains, the provision of additional training to enhance grid infrastructure, and the need for enhanced planning systems. 

While emerging economies such as Sub-Saharan Africa face huge financial barriers to grid development, which can be solved by enhancing the compensation structure for grid companies, promoting specific funding for grid improvements, and enhancing transparency in cost management, the main obstacle in more advanced economies is public acceptance of new projects and the lack of regulatory reform. According to the IEA, the best ways to overcome these obstacles is by improving the planning process, enabling regulatory risk assessments that facilitate proactive investments, and simplifying administrative procedures.

You might also like: Understanding the Energy Crisis in South Africa

About the Author

Martina Igini

Martina is the Managing Editor at Earth.Org. She holds two BA degrees, in Translation/Interpreting Studies and Journalism, and a MA in International Development from the University of Vienna. After working at the United Nations Global Communication Department in Vienna, she joined a newspaper in Italy as a reporter before moving to Hong Kong in 2020. Her interests include sustainability and the role of public policy in environmental protection with a focus on developing countries.

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