Category: Diversifying our energy mix
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An efficient energy mix is the key to maximising energy accessibility. This is particularly relevant to the power sector and provides a tool to harness the full potential of a region’s energy capacity.
The concept of energy mix needs to be applied locally as different regions within a country possess distinct energy resources and are weighed upon by varying regional energy-demand pressures.
There is no unique energy mix that can cater to all energy issues of a country or a group of countries. Unfortunately, policymakers tend to enforce general laws that go against the local characteristic of the energy mix, resulting in policy failures.
The European Commission’s stance on renewables is a prime example. Countries in the European Union, led by Germany, spend billions of Euros per annum to subsidise renewables in an effort to meet carbon emissions reduction targets. However, the regulations have very little to offer in terms of local energy mix strategy. This has attracted criticism of the Commission from within the European Union as well as from countries like Poland outside the EU.
More importantly, despite the drive towards renewables, coal demand in Germany’s power sector is rising, and the country has recently embarked on developing a new generation of hard-coal fired units. This can be seen as a policy failure, and costing the country at a time of weak economic growth.
Energy mix needs to be based around the local economy and not the other way round. This provides flexibility in adapting to changing realities, and can prevent over reliance on a single fuel. The economy of the US Midwest is heavily reliant on coal, which is an obstacle to the development of other energy sources such as natural gas and renewables.
The US Midwest economy has benefitted from the abundance of coal, in accordance with the local utilisation of energy sources. However, it is not exploiting the full potential of other energy forms that the region possesses. As coal technology in the region advanced before gas and renewables, the economy became coal-based. This in turn is hindering innovation in other energy forms.
A bottom-up approach is preferred compared to a top-down approach in establishing local energy-mix policies. This ensures robust infrastructure development, benefitting various sectors of the economy evenly.
For instance, rural parts of India have some of the largest biomass resources in the country. However, they are some of the most deprived in terms of energy accessibility and infrastructure development. Successive government policies largely ignored this strength and focused on energy developments aimed at industrialisation instead. This has resulted in the mass movement of the rural population towards urban centres, in turn adversely affecting the country’s agricultural sector, which once employed almost three-quarters of India’s population.
Establishing an efficient energy mix is the key to unleash a country’s full energy potential. The Golden Mean of Aristotle, the Doctrine of the Mean by Confucius and the Middle Way of Buddha all render themselves in establishing the same goal.