Understanding Main Drivers of Global Decarbonization

The global energy system is going through a period of historical change in which a large shift in energy sources is taking place. The opportunities and challenges of the global energy transition extend beyond borders, because fluctuations and deficiencies in available and required energy can only be compensated on regional and global scales. Abandoning fossil fuels (decarbonization), as a path to achieving climate neutrality, implies massive energy restructuring and new investments. From a global perspective, priority of decarbonization is to phase-out coal in the Asia-Pacific region. What undoubtedly characterizes the XXI century are many pilot and alternative technologies that have a high potential for decarbonization (so-called “game changers”), the low prices of fossil fuels exist because they leave out the external costs they impose on health and the environment, as well as necessity to make moves both on the demand and supply side of the economy in order to have greater use of RES. Consequently, this paper analyses and explores the potentials of the following three main drivers of restructuring of energy systems: (1) combination of market price signals and CO2 pricing, (2) increased use of renewable energy sources (RES), and (3) rapid diversification of energy supply through the usage of alternative technologies. With the aim of conducting research, the work is chronologically based on the analysis of the global energy system, where neglected imbalances on the side of energy supply and demand are highlighted. On this occasion, energy sources that supply the EU nowadays are descriptively explained, and the analysis includes the causes and consequences of this outcome. In order to understand main drivers of global decarbonisation, it should be emphasized that unlike permanent resources that are always available, regardless of the form of human activity directed at them, RES have the power of regeneration, provided that the intensity of their renewal is not threatened by the extent of their use. Therefore, the use of these resources may be time-limited, despite their renewable nature. According to that fact, this paper deals with the analysis of the use of alternative sources which indicates diversification of energy supply in the short and long term.