Lockdown energy use “a glimpse into the future”

LOCKDOWN ENERGY USE “A GLIMPSE INTO THE FUTURE,” SAYS ENAPPSYS CHIEF

Energy consumption habits for 2020 may provide us with a glimpse into the future with renewables expected to take a higher market share as the world begins to shift away from fossil fuels, according to the director of energy market analyst, EnAppSys.

The coronavirus pandemic caused overall European energy consumption to slump by 3 per cent for 2020 owing to the knock-on effects of lockdowns on energy demand.

Renewable sources such as wind and solar power are expected to continue to push out more traditional fuel types - gas, coal and lignite - from the energy market as trends in expanding renewable energy portfolios continue into the 2020s.

Analysts predict these are general trends we should see going into the future.

Jean-Paul Harreman, director of EnAppSys, told Industry Europe that the coronavirus pandemic was a wake-up call for companies to increase flexibility with their energy supplies.

He said: “I very much doubt the effects the pandemic had on the energy market will be permanent, at least in the shortterm. We may see more minor increases in renewable energy use than predicted, but the statistics show that once demand returns to normal, consumption habits nearly always bounce back.

“What we saw with the lockdowns was behaviour in energy markets not predicted for at least another three-to-five years, with renewable energy having a higher degree of penetration within consumption markets. At points, the gaps between renewable generation and demand were so small that it put pressure on short-term markets.”

Demand for energy reached its lowest during the summer months, which saw gas generation offering a way to balance out gaps in the market where renewables fell short.

Harreman stated this was due to gas assets being far more flexible in Europe than energy derived from coal or lignite.

Coal suffered a huge collapse in March, but levels have recovered and even exceeded 2019 levels, partly owing to an increase in gas prices going up past the marginal costs of coal, although Harreman primarily attributed this to Asian markets.

“Switching away from fossil fuels has been an ongoing trend for years but it has not had a great effect on the markets or its prices outside of what we have seen in 2020 with the pandemic. This is a real glimpse into the future once sustainable platforms become the norm,” he added.

The chaotic effects of the pandemic have highlighted the need to make energy platforms more sustainable to prevent such catastrophic effects in the future.

A number of industries have made efforts to switch away from more traditional fuels.

The global automotive market has seen a greater shift towards hybrid and fully-electric vehicles throughout the year, although a semiconductor shortage - attributed to significantly

increased demand for electronics as more people are stuck at home due to lockdown - has hindered these plans for now.

A number of countries, including the UK and Portugal, have opted to outright ban the sale of diesel and petrol vehicles in the wake of the pandemic, as they attempt to switch to more renewable platforms as part of their post-pandemic recovery plans.

These legislative bans have been met with praise from officials and executives within the automotive industry, with some believing stimulus packages may not be enough to stop their use.

Oil prices have been in flux for the past year, with the price even dropping below zero in the US for the first time in history due to significantly reduced demand.

This has been marked with a significant shift towards renewables as its lack of sustainability has been highlighted by the pandemic.

Harreman said: “The pandemic has certainly not slowed down the move towards sustainability, but it has made it clear that flexibility around renewables generation is highly valuable. Companies should look to flatten their profiles - handling the intermittency of renewables around market behaviour has become crucial.

“The world has certainly not seen a slowdown in global trends. It has shown that if we are going to continue pushing for increased sustainability things such as interconnected markets, influences from other countries and flexibility in production processes and generation must increase, with its value having been tested throughout 2020.” n

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