Every two years, the ETH Energy Science Center hosts a summer school about energy. This year, the focus was “navigating the transition in an insecure world”. Energy Blog editors Lingxi Tang and Jonathan Peel were among the 44 attending researchers and share the school’s three main takeaways below.
Summer School Format
Planning our energy future can no longer rely on straightforward market-based economics. Failures of the free market in energy systems, in the form of geopolitical risks and carbon emissions, are coming into the spotlight for both private and public investors. As energy researchers, it is important to develop a holistic understanding of the interdisciplinary challenges that come with solving these market failures. This year in September, the second edition of the ETH Energy Summer School, titled “Navigating the Energy Transition in an Insecure World”, was designed to facilitate this exact development while bringing together a global group of energy researchers. This year, 60 researchers based in 17 countries across four continents gathered to explore three key topics: geopolitical dynamics, energy security, and financing innovation. In addition to talks delivered by academic and private industry experts, participants also presented their research to one another during open poster sessions and had the opportunity to visit a hydropower dam and a waste-to-power plant. The program concluded with group case studies, where participants applied their learnings from the week to deliver a policy brief on a proposed energy strategy for a case study country.
This year, both of us had the privilege of participating, and in this blog post, we summarise three key takeaways from the summer school. Examples in this blog post will feature the four countries tasked for our group case studies. The countries, South Africa, Japan, Colombia, and Ukraine, represent a set of diverse and unique energy challenges.
Takeaway 1: (Geo)politics can either slow or accelerate the transition
In Ukraine, geopolitics has had an accelerating effect on the transition. In 2022, when Russia invaded Ukraine, Russia tactically crippled the Ukrainian energy system by destroying 71% of electricity generation capacity and suddenly cutting fossil fuel exports. This has two effects. Firstly, Ukraine is accelerating the rollout of renewables, as a decentralised and interconnected solar photovoltaic (PV) and wind-based energy system is much more robust to enemy bombing than a centralised fossil-based one. Secondly, the EU, as Ukraine’s ally, also accelerated its move away from fossil fuels through the policy package REPowerEU. See this blog post for more details.
Japan has the highest share of fossil-fuel-based generation in the G7, and its plans to scale up nuclear and renewables are further stymied by strong political and local opposition. Less well-known than nuclear, it has extremely high geothermal potential (i.e., 23 GW, which is significantly more than Iceland at approx. 7 GW), but strong opposition from the Onsen (Japanese bath) lobby has limited geothermal to just 0.3% of its electricity supply. In this case, political interests are blocking Japan’s plans to decarbonise.
In South Africa and Colombia, domestic politics are also slowing the transition, but there is potential to unblock opposition by pursuing a just transition to renewables. South Africa, with both the world’s most coal-dependent electricity supply and crippling grid unreliability, is burdened by the vertically integrated state-owned utility, Eskom. Despite rich renewable resources, South Africa has a slow renewable growth, as Eskom is the single buyer of electricity and prioritises contracts with its own coal plants. Unbundling Eskom is the clear solution, but with 91,000 workers, political opposition is strong. By driving a just transition, like through the Komati power station project, South Africa can create buy-in for the unbundling, while upskilling its workforce. Similarly, in Colombia, local and indigenous communities resist local renewable infrastructure, and Colombia’s national training service, SENA, is providing free vocational training for low-income groups.
We next discuss how, in situations where politics can slow the transition, transitioning to wind and solar becomes more attractive as a means of increasing energy security while decarbonising.
Takeaway 2: Decarbonisation and energy independence go hand-in-hand
A prominent argument for fossil-fuel-based electricity sources is that they are dependable and secure energy sources. However, this is no longer true. As shown in our case study countries, renewables are increasingly the safer, more resilient choice—while also supporting decarbonisation.
For example, South Africa continues to tap into its abundant domestic coal supply to generate ~80% of its electricity. Even if we put the pollution and emission problems aside, a retiring coal power plant fleet means that South Africa will need to pivot to another source soon: either other fossil fuels or renewables. South Africa already imports 99% and 98% of its oil and gas needs, respectively, and further reliance on fossil fuel imports would worsen the country’s exposure to foreign supply shocks and geopolitical pressure, compromising both sustainability and security. With abundant solar and wind resources, locally deployed renewables help South Africa to strengthen energy independence through local, decentralised generation while contributing towards its net zero target.
Renewables opponents might point out that even domestic solar and wind have their supply risks, especially for countries with political tensions with China, which leads in solar and wind manufacturing, and by committing to a renewables-dominated energy strategy, a country may become vulnerable to being held ‘hostage’ by China. In response, Professor Tobias Schmidt introduced the ‘Stock vs Flow’ argument, which argues that between a one-time technology import (renewables) and a continuous fuel import (fossil fuels), the former would be the less vulnerable choice.
Finally, as mentioned above, the decentralised nature of solar and wind energy becomes a key feature in military security. This advantage is key for countries with concerns about the military security of their energy supply, such as Ukraine.
These examples show that transitioning towards renewables brings both energy security and sustainability. However, the high upfront investments needed for renewable infrastructure raise key economic questions, which we explore in the next section.
Takeaway 3: Economics makes the transition both inevitable and exponential (but only in rich countries)
This takeaway was the storyline behind the many expert lectures at the summer school. In the keynote lecture of the summer school, Professor Schmidt set the stage, comparing renewables to historical technology transitions, and showing that, in the mid-2020s, the transition is now inevitable. The most impactful factor in this has been an unprecedented drop in the cost of solar PV – in 2010, the IEA predicted that there would be 18 GW of PV peak additions in 2024, when in reality there was 590 GW. The business case of renewables was reinforced with a talk from managing director Mr Griesshaber of Energy Infrastructure Partners AG. Investors do not trust the partners with their money because of a rosy vision for the future, but because they expect exceptional returns; return on investment from energy infrastructure from 2009 to 2024 was 16%, trumping all other assets (private equity, housing, shares, gold, etc.) and over 90% of new global energy generation built is now solar, wind, or batteries. We now have alternative technologies to fossil fuels that are cheaper and cleaner, and funding this replacement is already a massive source of growth and profit for many companies, investors, and nations.
We also learned that financial forces are more powerful than political ones, at least when markets are liberalised. Professor Hodge spoke to us about the US transition and showed that even in an era of “drill, baby drill”, the state building the most renewables is Texas due to its liberalised energy market, and new power generation capacity nationally in 2025 is expected to be over 90% renewable, as shown in Figure 2. Additionally, in a talk from Professor Fischhendler, we learned that even in politically unstable areas such as the West Bank, the Cyprus Buffer Zone, and Tibet, conflict actually increases the uptake of renewables as they offer energy independence at a reduced cost.
Finally, Professor Egli showed how financing can also stand in the way of the transition. Figure 3 shows that, in OECD countries and China, investments in renewables are now outpacing fossil fuels, but in all other countries, there’s no such investment transition. This is because the transition is essentially switching from a system with low initial investment but high operational costs to one with high initial investment but low operational costs, so whether renewables are cheaper depends on the cost of borrowing, which is much higher in non-OECD nations. This is important because these countries that are locking themselves into fossil infrastructure are those that will experience the largest population and economic growth this century. It is therefore paramount that we use our global financial institutions to de-risk energy-related borrowing in the global south.
