Energy transition and the post-COVID world

Alexey Gromov, Principal Director on Energy Studies took part in third session of the joint project of IMEMO RAS and Interfax "Russia and the World: Professional Conversation", dedicated to the topic “Energy Transition and the Post-COVID World”.

The Special Guest of the session is Alexander Novak, Deputy Prime Minister of the Russian Federation.

Moderator - Sergei Brilev, Deputy Director of the All-Russian State Television and Radio Broadcasting Company TV Russia, President of the Global Energy Association.

The discussion was attended by:

• Rae Kwon Chung, Nobel Peace Prize Laureate; Member of the International Committee for the Global Energy Prize;

• Elena Telegina, Dean of the Faculty of International Energy Business of the Gubkin Russian State University of Oil and Gas (NRU), Corresponding Member of the Russian Academy of Sciences;

• Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance.

The Session’s participants discussed, what changes have occurred in production, consumption and lifestyle during the pandemic; what is the rate of Energy Transition, and what limits it; whether oil is needed after 2030, and who will become the main player in the energy market after the pandemic; what is the role of Russia in the Green Agenda, and what challenges will Russian oil and gas companies face.

Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, noted that in the prospects for "energy transition" much depends on the behavior of so-called uncertainties. They relate to the behavior of three main groups that determine energy development, or at least have a decisive influence on it: consumers, regulators and investors.

Gromov noted that the model of energy consumption is changing, factors of new mobility are emerging - for example, more and more representatives of the younger generation are abandoning their own car in favor of public transport, electric vehicles, and taxis. "On the other hand, the energy transition requires colossal investments and they need to be taken from somewhere. That is, the consumer will pay for the energy transition, first of all. And in this regard, the question is how much today's consumer is ready to give up energy comfort in favor of a more climatic friendly, climate-efficient energy consumption model," Gromov continued.

"Another important point is, of course, the behavior of the regulator. And a lot has been said about this today - the course towards decarbonization and building carbon-neutral societies in the European Union, China, Japan and Korea will certainly be decisive for energy companies that are building long-term business,” the expert noted.