The importance of a just energy transition explained
Jonathan Spencer Jones
Posted on: 1 February 2022
The ‘just energy transition’ is taking centre stage in what is the most radical global transformation of the energy system since its initiation almost a century and a half ago.
The ‘just energy transition’ is taking centre stage in what is the most radical global transformation of the energy system since its initiation almost a century and a half ago.
While the technology and infrastructure has continually evolved and power delivery become more reliable, most of us continue to receive power at the end of long line from a distant generating station.
But that is fast changing with the move away from coal burning to clean and renewable alternatives such as the wind and sun in the drive to limit and lower carbon emissions into the atmosphere. While utility delivered power will continue to be a major component of the system of the future, so too will locally generated power, whether from a rooftop or a nearby small community facility.
At the same time, other sectors traditionally dependent on fossil fuels such as transport and industry also are having to move towards lower emission alternatives, principally with electrification with renewables, while hydrogen – blue and turquoise in the short term, green in the longer – is widely considered as a replacement for gas.
Such a transition from a ‘centralised’ to ‘decentralised’ model has been gathering momentum slowly for years with the growing awareness of sustainability. But it has been accelerated with the Paris Agreement with emissions reduction commitments from countries around the world for what is ultimately a global issue.
Despite the momentum gathered, an energy transition such as this takes time due to the many changes needed across such a widespread infrastructure or in many developing countries building out the absence of an infrastructure
What is a just energy transition?
With this energy transition has entered into the lexicon new terms such as ‘democratisation’ and the ‘just energy transition’. In an effort to get a definition of a just energy transition, one will soon realize that it has different meanings to different people depending on a whole range of factors – social, economic, cultural, work related, even the region or country in which they are living.
For example in a round-up of views from the Enlit team, Nigel Blackaby, Conference Director, comments on those whose livelihoods and environments are impacted, while Florence Coullet, Enlit Europe Content Director, mentions equal sharing of benefits and protections for the vulnerable in society.
In an effort to get a definition of a just energy transition, one will soon realize that it has different meanings to different people depending on a whole range of factors...
Heather Johnstone, Initiate lead, highlights the role of startups and indicates that they should ensure solutions are translatable to developing countries, while Areti Ntardimou, Smart Energy International editor, and Patrick Baudin, the Energy Markets lead, also mention energy poverty but not just in the developing countries but also in the developed countries where it is prevalent although without attracting the same headlines
Out of this is it is clear that in broad terms a ‘just transition’ is one that delivers benefits across societies, countries and the globe. The detail might vary somewhat from one country to another but ultimately the delivery is as much a global responsibility as is the emissions issue.
Why is a just energy transition important?
The energy transition, with the years it is going to take, has been likened to a journey towards a more equitable and respectful world, putting people at the centre.
It is important that a just energy transition should be able to unify and empower citizens, enabling them to become stakeholders in the energy system and the broader economy. It should be able to address the scourge of energy poverty prevalent not just in developing countries but also in most developed countries, improving poverty in general as a result.
And a just energy transition should improve the overall health of citizens with fewer pollutants in the air and potentially with limits on global warming and limits on the other physical and disease-related impacts that otherwise could result.
Examples of just energy transition funds
Often the question comes up: Is a just energy transition possible?
At a country level, governments have the responsibility to deliver a just energy transition but also it extends to utilities as the key sector players with their customer relationships, as well as other direct and indirect participants.
At a country level, governments have the responsibility to deliver a just energy transition but also it extends to utilities as the key sector players with their customer relationships...
For one thing, carbon dioxide or methane molecules released into the air in one location will very quickly disperse as they enter the atmospheric circulation systems. For another one country’s or company’s efforts to reduce emissions could be negated by another’s continued emissions.
This has led to a variety of different examples of just energy transition efforts that often go hand in hand with a just energy transition fund across different continents and countries.
A just energy transition in the UK
The UK supplier SSE delivered what was believed to be the first utility just transition strategy in November 2020, highlighting 20 principles to achieve it, and others are likely to follow as they also formulate emissions reductions strategies.
SSE defined its just transition as “… one in which the necessary investment in decarbonisation is secured and: current and future employees in energy are regarded with respect and given decent work; communities in which energy assets are located or planned are regarded as key stakeholders with comprehensive engagement on all key issues; and energy consumers are provided with affordable energy and accessible energy services.”
A just energy transition in the US
In the US, a Just Transition Fund has been established as a private sector initiative to support community based organisation projects in particular in the coalfield and coal-fired generation states of the US. Since its inception in 2015, the fund claims helping communities access more than $124 million in public funding for local economic development.
In December 2021 the fund launched an initiative to drive $100 million in new investments over the next three years, with almost one-fifth of that already committed at the time.
A just energy transition in the European Union
In Europe, the European Union launched a Just Transition mechanism alongside the Green Deal in December 2019. The mechanism includes a platform and various funds aimed to channel around €55 billion ($62 billion) over the period 2021-2027 to alleviate the socio-economic impact of the transition in the most affected regions.
These funds, access to which will be via territorial just energy transition plans, will provide for a variety of activities from investments in small businesses to research and innovation and environmental rehabilitation.
Alongside the initial groundwork, the platform has launched working groups on steel, cement and chemicals as carbon-intensive sectors and a fourth on stakeholder strategy to identify good practices to engage stakeholder groups.
A just energy transition in Africa
In Africa, the South African national utility Eskom has established a Just Energy Transition Office to support its evolution “towards a cleaner and greener energy future” of net zero by 2050.
A Just Energy Transition Financing Facility is being put in place at Eskom to provide concessional funding for clean energy projects on a ‘pay-for-performance basis’ and a pipeline of such projects has been identified.
Eskom has estimated its requirement to ensure a just transition in South Africa at approximately $30-35 billion, with the ‘Just’ qualifying that the transition will not negatively impact society, jobs and livelihoods.
The work towards a just energy transition in South Africa is supported by significant funding from the US, the UK and the European Commission.
Towards 2050 goals
As a foundation for the energy transition, the just energy transition will be top of mind for years to come. While the current targets are focussed on 2050, as technology continues to evolve so too will the power system beyond then.
As an example, 5G as a communication technology has still to become widely available, even in the most developed countries, but 6G is already being developed. With communications underpinning much of the delivery of the energy transition 6G will bring concepts and opportunities so far unimaginable in the years ahead.
Notwithstanding technology advancements these will reach different people at different speeds and times, indicating that a just transition is as much dependent on the older legacy technologies and solutions as it is on the state-of-the-art.
Do you want to learn more about the 'just energy transition'?
Will a green recovery be a just transition?
‘There is no energy transition without creation of value’
Empowering the global citizen
