What would you answer if I asked you about the evolution of the economy? And what should the energy of the future be about? Surely the answer to the first question is pessimistic. As Herodotus said, “your state of mind is your destiny”. Pandemic, economic crisis, inflation, war, recession, stagflation… It is difficult to remember a single year that we have not had disastrous news. And, despite this, our economy has not stopped growing since 2014, excepting, of course, 2020. Even next year, growth forecasts for our economy vary between 1.4% and 2.1 %. If we were to judge our economy by our state of mind or by the defeatist news we sometimes read, we would be in a permanent recession.
The answer to the second question is also conditioned by our negative view of events. The invasion of Ukraine has completely disrupted energy markets that were already experiencing strong increases in 2021. Gasoline, electricity, gas… Skyrocketing prices that have an impact on our economy, since mobility, transport and all industrial and productive processes require Energy. Energy dependence is, therefore, a vulnerability of our economy. A mantra that we have been repeating in the Association of Renewable Energy Companies for 35 years now. Spain is one of the European Union countries with the greatest dependence on fossil imports. In 2021, Spain spent more than 46,575 million on energy imports. The economic deficit of the energy sector, weighed down by these fossil imports, represented in magnitude 97% of the global deficit of the entire Spanish economy.
We see, therefore, how our energy mix conditions our economy. The two questions with which we opened this article are much more interrelated than it seems, because what we decide today about the energies we use tomorrow will condition our economy.
Recent years have been characterized by a consensus around the Energy Transition and the development of renewable energies. In fact, these energies had already starred in the European Green Deal, a series of initiatives to turn renewables into one of the pillars of economic recovery. If clean energy was considered essential for economic development and transformation before the pandemic, much more so after the various setbacks our economy has suffered.
However, recent events have been used to discredit renewable energies and seek to break that consensus. The false concept of the “cost of the energy transition” has been self-interestedly invented. The idea behind all these criticisms is similar: “if we are facing an energy crisis with soaring prices, we should use…”. Any example can then be inserted, from reactivating old coal plants to installing new nuclear plants. This reasoning ignores the technological advances to integrate into energy systems and the reduction in costs of renewable energy experienced in the last decade. Wind and photovoltaic, with cost reductions of 71% and 90% respectively (Lazard, 2020), are today the most cost-competitive electrical technologies. So cheap that the Lazard study already compares the new plants against the existing ones: it is cheaper to dismantle existing plants and install new renewables than to continue generating with the old ones. This is the real reason for its rapid development all over the world.
If a decade ago we had not suffered that absolute stoppage of more than six years in renewable development in Spain, and we would have continued with the growth we had until then, the energy problem today would probably be half. The impact of the tensions in the global energy markets on our local prices would be much less. And the technological developments to be able to cover all the demand with renewables would be much more advanced, without having to resort to the technologies of the last century. In other words, we would be experiencing the current energy crisis much calmer and at a much lower cost.
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Therefore, when we hear those siren songs that promise better energies using other sources, let’s contrast them with the real data.
Spain does not have oil or gas, even if they were non-polluting energies (which they are not) and cheap (which they are not), they would still be vulnerable. There are some energies that our country has in quantity, with generous energy resources. Wind, sun, water, biomass… Even this year, in the worst European drought in the last 500 years, 42% of electricity has been renewable. It will not be strange that we will soon reach more than half of the electricity production. However, the Energy Transition must benefit all sectors: biofuels in our tanks, biomass boilers, electric mobility, renewable hydrogen for our industry…
Renewables are our oil, a non-polluting, clean and native oil. We must bet on them, undoubtedly interested. They must be the lever to create employment and develop industry. In Spain, today we have more than 111,000 workers in a renewable sector that represents 1.6% of GDP, but the potential is much greater. We are talking about a sector with global investments of 365,900 million euros per year, investments led today by the capitalist United States and communist China. As we can see, energy and the economy do not understand political positions.
The renewable revolution does not understand ideologies, it only understands technology, economy and health for citizens, the environment and the planet. So next time you’re asked about renewable development, remember: Steps Back in the Energy Transition? Not even to gain momentum!
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