Why we can achieve an accessible and desirable energy transition

As the COP28 is starting, we are witnessing an increasingly worrying and somewhat absurd picture. A new UN report just announced we were heading towards a nearly 3°C climate warming with current countries’ pledges. Yet, instead of a global impetus to increase our ambition, some states and companies – notably from the energy sector – are backtracking on their existing commitments. ?At the very moment we need to accelerate, they are slowing us down, to the detriment of the planet and the people.

As the CEO of a global energy player, and as a citizen, I am concerned. Each renunciation is a step backwards, compromising our chances of meeting our Paris Agreement goal.

The reasons invoked to alter the pace of the energy transition? Its feasibility and its cost. Accelerating it would mean imposing a burden too great for our economies, affecting our cohesion. For sure, the energy transition is a considerable challenge that requires investments at every level. But it is within our grasp and it is a desirable future for us all.

The energy transition is by no means a feat we cannot afford, nor something that requires finding new solutions. We already know the levers we need to decarbonize our economies. Some are already implemented and have proven their efficiency, others are just about to be deployed: the alliance of the electrons and molecules, decarbonized infrastructures, flexibility, energy efficiency and sufficiency. No technological breakthrough is necessary.

Furthermore, the energy transition is attainable at reasonable costs. For a company like ENGIE , it is even profitable! In the EU, almost half of emissions can be abated at a cost below the carbon price. For the remaining half, technologies are already known and even deployed, although their implementation remains often costly due to their different level of maturity. Yet, like for renewables 10 years ago, their cost will decrease as they are scaled up. From 2010 to 2022, the cost of solar panels was divided by 11 and that of batteries by 8.

Renewables, our main decarbonization levers, are becoming increasingly competitive. Today, solar and wind power are less costly than thermal, coal and gas assets. Developing them further implies investing rapidly in electrical infrastructure and flexibility technologies, yet this investment remains manageable. Overall, the weight of investments in generation, flexibility and infrastructure will be almost entirely offset by the variable cost reductions achieved in generation.

A low carbon energy system offers additional advantages – and not of the least importance. Renewables, by definition, reinforce our sovereignty by developing locally produced energy. They can also protect us from price volatility in times of crisis, since they are less dependent on the geopolitical context. Between 2021 and 2023,? the EU added 150GW of solar and wind capacity. If it was not for this added capacity, we would have resorted to more expensive thermal and gas assets for an additional costs of around 100 billion euros.

More than a reasonable option in terms of costs, the energy transition is an immense source of opportunities for our economies, and for each and every one of us. It will be a net job creator, largely offsetting losses in carbon-intensive energy sectors: about 17 million jobs – mostly local – could be created by 2030 in the IEA’s Net Zero scenario. It should also have a positive impact on household purchasing power, as the ECB estimated for Europe in its last climate stress test.

Accelerating the energy transition is the best decision we can take to ensure our prosperity and social cohesion. Slowing down the energy transition is the certainty of endangering both. Important economic losses are expected: we could lose 18% of global economic value in the case of a 3.2°C warming. And these losses would affect first and foremost the most vulnerable communities. The World Bank warned that 68 to 135 million people could be pushed into poverty because of climate change as early as 2030.

The stakes are unprecedented. Accelerating the energy transition is in our hands, it is our responsibility, and our duty to future generations. I am confident in our collective ability to reverse the emissions curve while continuing to create value. This is a transition that we are making across ENGIE , in all the countries in which we operate, and with the desire to conduct this transition responsibly and fairly.

We must not give up on the energy transition out of fear or discouragement. The transition does not mean ending our prosperity. On the contrary, it is synonymous with a new form of growth – more inclusive, responsible and sustainable!