Michael Strugl on the energy transition

The future begins now. When I think of Austria in 2040, we will be living in a country that is powered by renewable energies and where resources are used efficiently and wisely. A country where there is a social consensus to work together to avert the climate crisis and preserve quality of life on our planet. A utopia? Much of what seems unrealistic to us today is possible – but only if we want it.

The European energy world has spun on its axis

We are at an unprecedented turning point. Nothing has been the same since Russian troops invaded Ukraine in February 2022. Comparatively cheap pipeline gas from Siberia is no longer available or is only available to a limited extent. This has also had a massive impact on electricity prices, as gas power plants still have to step in to maintain supplies. According to the European Commission, Europe should be completely off Russian gas by 2027, and no gas should be burned in 2050. What does this mean for our future? How can we safeguard energy supply and achieve the transition to clean energy?

Germany has impressively demonstrated what is actually feasible. What was previously thought to be almost impossible suddenly became our reality when constructing liquefied natural gas terminals: processes were dramatically accelerated. This record-breaking pace would be required in Austria to expand renewables along with grid infrastructure. The challenges are enormous: all fossil processes would have to be converted to renewables to achieve a carbon-neutral economic system by 2040. Until then, electricity demand will also increase massively, from 71 terawatt hours in 2020 to 125 terawatt hours in 2040, according to the recently submitted draft of the Austrian grid development plan.

Working together to drive expansion

We need to think bigger when it comes to the expansion of renewable energies. In the future, open-field photovoltaic installations must be just as integral to the landscape as wind farms Both technologies play a key role in making our country climate-neutral. However, to create acceptance for this, we need to involve citizens and local politicians in project planning at an early stage. Participation models are also becoming increasingly important so that projects can actually be implemented. This also requires regional and local policymakers to take responsibility for safe energy supply, and we need them to play an active and supportive role.

Another key technology for the transition to clean energy is green hydrogen. The carbon-free energy source can be used as a gas in industrial processes, can be used to operate vehicles, and can store energy. This makes it a game changer for decarbonising industry and heavy goods traffic. The goal of building up one gigawatt of electrolysis capacity by 2030 is ambitious from today’s vantage point. In addition, a large proportion of hydrogen will have to be imported in the future. It is therefore important to create the framework for developing the hydrogen economy in Austria and Europe.

We need to turbocharge the transition to clean energy .

We need to accelerate the transition to clean energy. According to the grid development plan, we will need 39 terawatt hours more green electricity by 2030 (instead of 27 terawatt hours under the Renewable Energy Expansion Act) and as much as 69 terawatt hours more by 2040. This means that we must urgently identify the space needed for the additional wind power and photovoltaic systems we need. Even though politicians have accelerated the pace of EIA legislation, we are still lacking the Renewable Energy Expansion Acceleration Act. At the same time, the demands placed on grid infrastructure are increasing: the transition to clean energy cannot succeed without high-performance power grids and flexible storage capacities.

VERBUND alone plans to invest around 15 billion euros in the transition to clean energy over the next decade. The money is to be used to finance new generation facilities, power lines and additional pumped storage power plants. Numerous individual projects are behind this, some of which have been in planning for a long time and are awaiting approval. Rising interest makes financing projects more complicated. The fact that even part of energy suppliers’ profits are still being skimmed off weakens the financial strength of the companies that are supposed to rapidly expand security of supply.

A look backward and forward

But I am convinced that the transition to clean energy can succeed. A look backward helps to explain this: after the Second World War, our forefathers – driven by their faith in the future – achieved what seemed impossible. By working together, they brought a country and a continent in ruins into a new, prosperous age. We need this kind of conviction today, too. We need to believe that we can all pull together to build a sustainable and low-carbon economy. We need to drive the transition to clean energy, expand renewables and develop new technologies. Yes, this change is difficult. Yes, it will cost us a lot of strength and enormous effort. And yes, we will have to clear a great number of obstacles out of our way. But it is possible. We’ll tackle it, because together we are the power of change!

Since January 2021, Michael Strugl has been CEO of VERBUND and president of Oesterreichs Energie, the interest group representing Austria’s electricity industry. He has set himself an ambitious goal with Mission V: to proactively drive the transition to clean energy.