Energy in Review: February 2023 News Roundup
A recap of some of the month’s biggest energy stories and breakthroughs.
Russia significantly reduces oil exports following continued sanctions from the West.
Russia has announced that it will reduce oil outputs by 500,000 barrels a day in March, which is about 5% of the country’s oil output. This comes after the G7 and the EU set a price cap on Russian exports late last year.
Russia’s budget deficit reached a staggering $45 billion in 2022 and it is unlikely to improve as it continues to wage war in Ukraine amid mounting sanctions from the West.
International Energy Agency (IEA) predicts that renewable and nuclear energy will be able to meet nearly 100% of growth in global electricity demand by 2025.
The IEA’s February Fuel Report outlines that by 2025, renewable and nuclear energy will meet over 90% of the growth in global electricity demand. This projection comes alongside an expected investment in electricity grids and power stations, with a focus on sustainable integration. Four countries, China, India, Japan, and South Korea, will contribute to more than half of the growth in nuclear energy generation, with Europe and the United States lagging behind, despite calls to diversify modes of green energy generation.
Gas Prices in Europe Are Lowest Since 2021.
As the Russian war in Ukraine reaches its one-year mark, European energy prices fall to less than €50/MWh, the lowest cost since 2021. A confluence of factors contributed to the avoidance of a more severe energy crisis, including a mild winter, conservation efforts, and government interventions that shielded consumers from ever-worsening costs.
Dutch officials warn that Russia is eyeing North Sea energy infrastructure.
Jan Swillens, Director of Dutch military intelligence, reveals that there is evidence proving that Russia mapped energy networks in the North Sea, paying special attention to offshore wind farms. As a result, 10 Russian diplomats have been expelled and Moscow must close its trade office in the Netherlands by the end of the month.
Eskom CEO removed from position, after the Board of Directors decide that ‘he did not need to serve the remainder of his notice.’
Andre de Ruyter, CEO of South Africa’s electricity provider Eskom, is removed from his position a month before his intended departure. Announcing his resignation in December, de Ruyter had expected to serve until the end of March in order for the company to hire a replacement. However, after appearing in an interview, during which he alluded to corruption in the African National Congress, the Board of Directors immediately ended his contract.
Eskom has been embroiled in controversy and debt as the country faces another year of daily load shedding. Though President Cyril Ramaphosa declared a state of national disaster earlier this month to emphasize the effects of the energy crisis, the Ministry of Electricity position remains unfilled.
Podesta defends US Inflation Reduction Act amid continued criticism from the EU.
In an interview with the Financial Times, President Biden’s senior clean energy advisor, John Podesta, said ‘We make no apologies for the fact that American taxpayer dollars ought to go to American investments and American jobs.’ He was responding to concerns that the act aimed at promoting American clean energy will take resources and investments away from Europe.
As tax credits and grants approaching $370 billion attract businesses and further investments, European leaders, such as French president Emmanuel Macron, believe that it has the potential to ‘fragment the west.’
References
Bloomberg News. (2023, February 10). Russia to Cut Oil Output in Retaliation for West’s Sanctions. Bloomberg.
Cluskey, Peter. (2023, February 20). Spying claims: Netherlands expels 10 Russian diplomats. The Irish Times.
International Energy Agency. (2023, February). Electricity Market Report 2023. IEA.
Ndenze, Faith. (2023, February 10). President Ramaphosa Declares National State of Disaster in Electricity Crisis. Parliament of the Republic of South Africa.
Rédaction Africanews with AFP. (2023, February 23). CEO of South Africa’s public electricity company Eskom ousted. Africanews.
Warner, Bernhard. (2023, February 17). European Gas Price Falls to Lowest Level Since 2021. The New York Times.
Williams, Aime and Bower, Derek. (2023, February 24). US makes ‘no apologies for prioritising American jobs, clean energy tsar tells EU. Financial Times.