As renewable energy sources are so expensive there is demand for them in developed countries only

28 october 2016 | IA REGNUM

Deputy Head of the Department for the Fuel and Energy Sector of the Analytical Center Irina Pominova believes that Europe needs alternative energy for political purposes, i.e. to reduce its dependence on imports of fuels. Renewable energy is still expensive and unstable but developed nations are seeking to boost their energy security. For Europe, renewable energy sources are first and foremost a way to reduce dependence on energy imports. As for nuclear energy promotion, there is a lot of disagreement between European countries,” Ms. Pominova told an IA REGNUM correspondent.

Irina Pominova
Irina Pominova
Department for Fuel and Energy Sector

Nuclear power may see increasingly more competition from alternative energy since both nuclear power and renewable energy are being used primarily for electric power generation and are viewed as ‘clean’ energy that help achieve climate change targets. But, first, this competitive pressure first emerged in mid-2000s when renewable energy entered a phase of active growth, while the nuclear power sector, by contrast, was going down, a trend that picked up pace in 2011 after the Fukushima-1 incident in Japan. Secondly, the most important consideration in the development of nuclear power is economic efficiency and safety, Ms. Pominova noted.

“As the prices for hydrocarbons fall, there is more pressure being put on nuclear power from fossil fuels as well. As for supporting ‘clean’ low-carbon energy, an important factor with regards to renewable sources was the signing of the Paris Climate Deal, but in this context, the wide adoption of renewable sources (reducing costs) creates a threat primarily for coal,” the analyst explained.

At the same time, today renewable energy sources are facing several problems such as investment barriers in developing countries as well as the slow pace at which alternative energy is developing in the heating sector. At the same time, the main ‘tech’ barrier in the developing nations is still the high cost of renewable energy even for the most competitive solutions such as wind and solar power, the expert noted. Another reason is the lack of state support measures. Specifically, when it comes to connecting to the grids without which renewable energy cannot be widely adopted, the expert explained.

“In the heating sector it is bioenergy that is most in demand but it is not as competitive while the positions of traditional energy sources are still very strong here. In the transport sector, biofuels are already competing not only with petroleum that has become significantly cheaper but in many cases with natural gas and electricity. In addition, a few questions emerged regarding the first-generation biofuels (made from crops), including from the point of view of the overall positive effect on the climate,” the expert informed.

Ms. Pominova is also sure that because of the relatively high price of renewable energy, it is most in demand in the developed countries where there is the political will and the requisite state support for promoting it and where the public want to and can afford to pay more for ‘clean’ energy. And when it comes to the developing nations, especially in regions faced with the problem of energy shortages (Africa, South-East Asia and India), it is the economy that is given top priority, and despite the expanding climate related restrictions, these countries are going to continue building power plants using the most affordable technologies. On the other hand, renewable energy sources hold promise for those countries as well, as an option for building decentralized systems, through international support for alternative projects, and, possibly, to develop domestic energy sources, the expert believes.

China, that consumes 22% of all the energy produced in the world and where coal is at the core of the country’s entire energy balance, should be regarded separately, Ms. Pominova believes. “For China, switching to renewable sources is dictated by environmental considerations and energy security considerations. In addition, China is one of the largest producers of alternative energy in a few areas. It should be noted here that China also has the world’s largest plans for nuclear power development,” Ms. Pominova summed up.