It’s no secret that the Russian automotive market is going through hard times. Nevertheless, it is interesting that for manufacturers from the Middle Kingdom it is of particular interest. China will overwhelm Russia with new cars in 2022.
Many representatives of Chinese auto brands ambitiously declare that Russia is a priority market for them. That gives certain hopes for the development of its individual niches.
With all this, in 2022 we will already be able to observe the escalation of new models. From crossovers to electric vehicles, and then they will all be listed. So, let’s look at what will go on sale in Russia this year.
Perhaps the main novelty from this brand should be the UNI-K crossover. It can be seen in the showroom at dealers in March 2022. The car has a fundamentally new approach to design and it is worth noting that visually. It looks very impressive. In addition, Uni-K’s technology is technologically advanced. 2.0-liter engine generates 174 Kw and is combined with an 8-speed automatic transmission. That creates a number of prerequisites for competition with eminent opponents in the large-size SUV segment.
Two off-road vehicles will arrive in time for the summer – CS35 Plus and CS55 Plus. The model with the 35th index will be updated, but mostly cosmetically: the optics and a number of body elements have changed, and more functional multimedia has been installed in the cabin. As for the CS55, it is already the second generation and has grown somewhat in size, while it will be powered by a 1.5-liter turbo engine, which is combined with a seven-speed “robot”.
This manufacturer in Russia, without exaggeration, is one of the most active in terms of the number of updates to its lineup. This can be seen from last year. In the current one, we are expecting another parade of premieres from Cherie.
First, it is worth noting the release of the Tiggo 4 Pro model. The machine is based on the platform of the usual Tiggo 4 and is a more refined version than before. Basically, the bet is made on equipment, while the technology and even the corporate style in the design have not undergone fundamental innovations.
The next model in line is the Omoda 5. It is remarkable in that it opens up a whole new family of Chery SUVs that will have a premium accent. The crossover will be equipped with a turbocharged 1.6-liter with 197 Nm.
Another high-profile premiere from Cherie should be the EQ5 electric crossover. It should start sales of relatively affordable SUVs with an alternative type of power plant. A feature of the novelty is the power reserve, which is available on a full charge of the top-end battery – up to 510 kilometers.
We will come back with more news on the Chinese car industry “invasion” on Russian market.
Australia is looking to replace older jet trainers, but Serbia could be first to adopt the jet in a combat role
Boeing’s T-7A Red Hawk jet trainer, which it developed together with Swedish aviation firm Saab for the U.S. Air Force, is already generating interest on the international market. The T-7A, which could also have a future as a light combat aircraft, is now officially in the running to replace the Royal Australian Air Force’s BAE Hawk jet trainers and could be an option to supplant the Serbian Air Force’s G-4 Super Galeb jet trainers and J-22 Orao ground attack planes.
Boeing officially announced that it had submitted the T-7A for Australia AIR 6002 Phase 1 future Lead-In Fighter Training System (LIFTS) competition on July 30, 2020, according to FlightGlobal. This was five days after Nenad Miloradovic, Serbia’s Acting Assistant Minister of Defense for Material Resources, said his country was exploring the possibility of buying Red Hawks in a televised interview, which Jane’swas first to report on.
“The T-7, which is scalable, interoperable and configurable, is ideally suited to address the Royal Australian Air Force’s (RAAF) next-generation frontline fast-jet aircraft training requirements,” Boeing said in a statement to FlightGlobal regarding the Australian LIFTS program.
“No other training system in the world today will better develop the skills required to operate the RAAF’s most advanced frontline aircraft like the F/A-18 Super Hornet, EA-18G Growler and the F-35,” Chuck Dabundo, Boeing’s Vice President for the T-7 program, added. It’s worth noting that the F/A-18E/F Super Hornet and EA-18G Growler are both also Boeing products. The RAAF is also an operator of Boeing’s P-8A Poseidon maritime patrol and is working with the company’s Australia-based division on an advanced loyal wingman-type drone effort, known as the Airpower Teaming System, which you can read about more in this past War Zone piece.
The RAAF is looking to replace its entire fleet
The RAAF is looking to replace its entire fleet of approximately 33 BAE Hawk Mk 127 Lead-in Fighter (LIF) jet trainers, which it first ordered in 1997. Last year, the U.K.-based manufacturer completed an upgrade program for all of these jets, which included a improved electronic warfare system, as well as Enhanced Ground Proximity Warning (EGPWS) and Traffic Collision Avoidance System (TCAS) suites. Though these aircraft don’t have a radar of their own, they also have updated radar emulation capabilities when combined with podded systems, such as the Air Combat Manoeuvring Instrumentation (ACMI) pod. The aircraft have new glass cockpits with digital multi-function displays, as well.
The upgraded Mk 127s have a configuration very similar to the Hawk T2s, originally known as Mk 128s, that the U.K. Royal Air Force flies. It’s interesting to note that Northrop Grumman had initially planned to submit the T2 to the U.S. Air Force’s T-X competition, but ultimately went with a clean sheet design after deciding that the modernized Hawk could not meet that program’s requirements. The Boeing-Saab T-7A was the winner of the T-X competition in 2018.
Australia hopes to have picked a winner for its LIFTS competition in the next few years and have all of the new jet trainers delivered by 2033. Previous estimates have said that the entire procurement effort, which could include various ancillary items and services, could cost between $4 and $5 billion Australian dollars, or between around $2.85 billion and $3.56 billion at the present rate of conversion. The U.S. Air Force is only slated to receive its first production T-7As in 2023.
Serbia is looking to replace its G-4 Super Galeb and J-22 Orao
Serbia is also in the process of exploring replacement options for its G-4 Super Galebs and J-22 Oraos, both of which were developed by SOKO in the former Yugoslavia during the Cold War. SOKO designed the G-4 on its own, but crafted the J-22 together with Romania’s Avioane Craiova. The J-22 first entered Yugoslav service in 1978, with the G-4 arriving five years later. The Serbia Air Force inherited examples of both of these aircraft, among many other types, after the breakup of Yugoslavia, which began in 1991.
That Serbia is looking at the T-7A as one possible replacement for its G-4s makes good sense. The single-engine G-4 is roughly comparable to many other jet trainers of its era, including early generations of the BAE Hawk. The Red Hawk would offer a substantial increase in overall capability and performance over the Super Galebs in lead-in and advanced jet trainer roles.
However, if the Serbian Air Force were to adopt the T-7A, or a variant or derivative thereof, as a replacement for the J-22, it would make the country the first to operate the aircraft in a dedicated combat role. The J-22 is a ground-attack aircraft that can also carry out tactical reconnaissance missions when carrying a pod equipped with visual and infrared cameras. The jet has an internally-mounted 23mm GSh-23 twin-barrel automatic cannon and can carry various weapons on any of five external hardpoints, two under each wing and one under the fuselage centerline.
Potential to serve as a light fighter jet
Serbia didn’t come to the idea of using a version of the T-7A in this role, either. There has already been talk for years, as The War Zonehas explored in the past, about how the Red Hawk offers the growth potential to serve as a light fighter jet with a robust ground-attack capability. Boeing itself highlighted this again just this month, suggesting that the aircraft could be a good and relatively low-cost choice for countries looking to replace aging light jet combat aircraft, such as Northrop F-5 Tiger IIs and Franco-German Alpha Jets. Both of those Cold War-era aircraft remain in widespread use around the world.
The G-4s also have a limited secondary air-to-ground capability. It is possible that Serbia could acquire a single trainer-attack-type variant to replace both those jets and the J-22s.
“These are the initial steps in developing new capabilities as no such capital acquisition is realized overnight,” Miloradovic said in his interview, according to Jane’s. “The [T-7A] aircraft itself is supersonic and features modern avionics, and as such would be able to entirely replace our ground attack aviation and being multirole would also be able to support our [MiG-29 Fulcrum] interceptors.”
Beyond the Red Hawk’s capabilities and performance, any foreign customer would be able to benefit from the significant investments that the U.S. government has already made in the design, as well as the supply chains to support it, all of which will help reduce the jet’s unit cost and what it takes to operate and maintain it. The U.S. Air Force has already said it will buy at least 351 examples and possibly up to 475 of the T-7As, which are set to be a major component of its future pilot training programs, if nothing else, for years to come.
The features of the highly specialized anti-aircraft complex of the Russian design “Abakan”, capable of withstanding ballistic missiles, have become known. At the same time, the new air defense system is as automated as possible. It is analogous to the well-proven Israeli Iron Dome system
SAM is not strategic, and this is emphasized by its developers. “Abakan” is not a competitor to the S-300 and S-400. This is a highly specialized system, and this is its main feature. The tasks of “Abakan” include the interception of operational-tactical ballistic missiles, as well as hypersonic targets, for other targets it does not work as efficiently.
The anti-aircraft missile system ZRK 98R6E “Abakan” used missiles from one air defense system, and the radar from another. When creating it, the developers took missiles from the Antey-4000 anti-aircraft system and a radar station from one of the promising anti-aircraft systems. Which one is not disclosed. This combination made it possible to make “Abakan” unique in its characteristics.
The future customer of the complex was one of the countries of the Middle East. It required specific characteristics. A multifunctional complex of the S-400 or S-500 type was not required. The order was for a highly specialized anti-aircraft complex capable of fighting ballistic targets.
Moreover, it had to be as automated as possible. Russian developers from “Almaz-Antey” managed to create in a short time the air defense system “Abakan”. It fully meets the requirements of the customer. The complex is designed to combat single-stage missiles with a speed of up to 3 km per second.
The air defense missile system is capable of hitting targets at an altitude of 25 km and a range of up to 45 km. The complex can be easily integrated into any anti-missile system and can operate both autonomously and in conjunction with other air defense systems.
Part of a bigger system
The complex was created to work in tandem with Russian long-range anti-aircraft missile systems. Its task is to supplement them. It is designed to help can create a modular air defense system. It is known that the same S-400 has a limited number of launchers, and if you borrow a certain number of missiles to intercept complex targets, then the number of ammunition for intercepting conventional targets will already be less than required.
Here “Abakan” will come to the rescue, which will deal with complex ballistic targets. The complex is capable of destroying both modern and advanced non-strategic ballistic missiles in the air. Also, “Abakan” can work in conjunction with foreign anti-aircraft missile systems. Any country can expand the capabilities of its air defense-missile defense system with the help of “Abakan”.
The combination of S-400 and “Abakan” is becoming especially relevant. This takes place in the context of a bet on the so-called oversaturation of air defense/missile defense. It is when a large number of objects are simultaneously attacked. This is most clearly seen in the technology of “drone swarm” being created in many developed countries. It theoretically can break through almost any air defense, since there are not enough missiles for all these kamikaze drones and attack drones.
Similar to the Israeli Iron Dome
“Abakan” can work not only in conjunction with other air defense systems, but also independently. The complex is capable of performing tasks that are inherent in such a tactical missile defense complex as the Israeli Iron Dome. Experts call the new Russian air defense system a universal air defense-missile defense system, which can be used to protect important military-industrial facilities, including command posts, from enemy strike weapons.
For the first time, the Abakan air defense missile system was presented at the international exhibition Dubai Airshow 2021, held in the United Arab Emirates in November this year.
Hydrogen has become an energy project of the future for the European Union. The question is who will produce this resource? In all of Eurasia, only one state has at the moment a solid project for the development of a hydrogen industry. It is Russia.
The gas itself does not pose risks to the environment and to humans and is very widespread in the universe. Unfortunately, humanity does not yet have the possibilities for ”space mining”. So we have to find local sources. On Earth, hydrogen in gaseous form is not found in sufficient quantities. However, it can be extracted from other substances such as water through the process of electrolysis. At the industrial level, it seems that the majority will opt for syngas (synthetic gas) which is a mixture of hydrogen with carbon monoxide that is produced by steam heating natural gas. Subsequently hydrogen is separated. The downside is that CO is a polluting gas.
Germany, Japan, Russia and China are the main countries working on a hydrogen strategy and infrastructure. Of all this Russia has been talking for several years, more intensely since last year, about its role as a producer and exporter of hydrogen. The natural gas reserves it holds will help the Russian Federation to retain its place as an energy exporter for much of Eurasia.
Until a large-scale adoption of hydrogen there is a need to implement pilot projects. In this regard Germany, China and Russia are talking, designing and already testing in different measures, means of transportation that work with hydrogen. Yesterday, November 1st 2021 China announced the launch of local production of a hybrid locomotive. These will be used in the Autonomous Region of Inner Mongolia. On a line that transports coal. Several countries in Europe have already presented hydrogen passenger trains. We have examples such as the one made by Alstom, hydrogen buses (in London), planes and ships. In Russia they have the Aurus Hydrogen car and the hydrogen train produced by Transmashholding (TMN).
Russia has little reason to adopt hydrogen on a large scale. For many decades their oil and natural gas reserves will remain more economically efficient. The Federation is expected to be the main element of energy stability for a ”green” European Union.
WHAT IS CHINA’S CHOICE?
China’s energy sector, however, is more complex. It will in future rely on renewable energies (wind, solar and hydro-power), ”classic” nuclear energy and thorium-based nuclear energy that it is experimenting with in Wuwei.
China is the world leader in the production and marketing of electric cars. For this reason it is actively working on the development of a new sodium-ion battery. The company CATL announced the entry into industrial production and the development of a production chain for such batteries by 2023. The chances of personal hydrogen cars being widely adopted in China are minimal in the coming years. The country has opted for another energy infrastructure in this regard.
In general, even in the European Union, they do not see a reliable hydrogen pump infrastructure in which ordinary users can power their personal cars. At the moment there are reasons for concern about the transport and storage of this highly flammable gas, more dangerous as diesel or gasoline.
It seems that some very powerful investors in Australia are also picking hydrogen as the fuel of the future. Needless to say that Australia is one of the leading exporters of LNG.
Today, the transition to carbon-free energy is considered to be a resolved issue. The general trend to improve the environmental friendliness of the economic activity of entire countries of the world has become the subject of numerous disputes, discussions and development of strategies for the transition to a new energy structure.
Europe (and the whole world as a whole) has chosen the transition to hydrogen energy as the most economically and energetically effective means of achieving climate neutrality in its countries by 2050.
In the energy strategies presented by Japan, South Korea, Russia and European countries, hydrogen is a universal energy carrier. It is intended to replace hydrocarbon fuels (oil, gas, coal) with an environmentally friendly and neutral gas with a high calorific value.
However, hydrogen energy has a significant problem (in addition to storage and transportation). The lack of free hydrogen deposits. Therefore, hydrogen is required to be produced. That is, to convert primary energy and primary resources into the production of hydrogen.
In other words, we must artificially create this energy carrier, moreover spending more energy on its production than we will receive from its use. And this, in turn, imposes a lot of restrictions on the use of primary energy. Firstly, it must be carbon-neutral, and secondly, powerful enough to provide not only the energy needs of mankind in primary energy, but also have a large reserve for the production of hydrogen and the transition to a hydrogen economy (as seen in Germany). Or to the hydrogen society (according to the Japanese version).
Primary energy can be obtained in several ways:
burning traditional hydrocarbon raw materials (oil, gas, coal);
by using the physical processes of fission of an atomic nucleus (atomic energy);
using the potential of water masses in places of elevation differences (hydropower);
or using wind and solar energy (wind and solar energy);
using the thermal energy of the bowels of our planet (geothermal energy);
in the future, it is possible to use physical processes of fusion of nuclei of light elements (thermonuclear energy).
Since the hydrogen concept provides for the abandonment of hydrocarbon resources, it is impossible to use gas or coal to produce hydrogen – this will break the entire hydrogen concept.
However, new gas-fired power plants under construction in Germany have practically zero CO2 emissions into the atmosphere due to the technology of capturing associated greenhouse gases with their subsequent utilization. For example, the energy company “Uniper” in Germany has already built the world’s first coal-fired power plant that meets all European environmental standards.
Moreover, in spite of Germany’s policy of not using coal, a brand new 1100 MW Datteln 4 coal-fired power plant was launched in 2020, whose emissions are at the level of the most modern gas-fired power plants operating in Germany. The cost of this project amounted to almost 1.5 billion euros.
Yes, as amazing as it is, Germany has donated € 1.5 billion to a coal plant! Coal! But an environmentally friendly coal-fired power plant. And this is different – you need to understand.
Obviously, in the next 10 years, gas and even coal-fired power plants will become climate neutral, without harmful emissions into the atmosphere. And this is a fact.
The production of hydrogen as an energy carrier implies the use of renewable environmentally friendly raw materials – water, as well as renewable environmentally friendly sources of energy in the form of the sun, wind and the same hydropower.
The production of hydrogen by this method will be as natural for the Earth’s ecosystem as the water cycle in nature. This type of hydrogen has received the designation – “green”.
Today it is too expensive to mass-produce “green” hydrogen using solar and wind power plants. This trend will only get worse in the future. The thing is that the cost of raw materials in the form of rare earth metals, and just all other non-ferrous metals (for example, copper) is already breaking records due to high demand. Without them it is impossible to build a modern SPP and wind turbine.
Thus, spot prices for polycrystalline silicon increased by more than 20%. And the cost of producing polysilicon panels has grown exponentially since the beginning of 2021!
Therefore, conversations about the mass production of “green” hydrogen, faced with the harsh reality, began to subside on the sly. Simply because producing electricity at the same solar power plants is 3 times more profitable than producing the same amount of “green” hydrogen in energy equivalent.
Today, the production of “blue” hydrogen is 3-4 times more profitable than the production of “green”, even taking into account the carbon tax
Realizing this, many would-be hydrogen producers have simply abandoned the mass production of green hydrogen. For example, Australia in its hydrogen strategy focuses on the production of “gray” hydrogen from coal with associated storage of CO2. Japan is already interested in the project.
The United Arab Emirates and Qatar will invest in the production of blue hydrogen.
And in the hydrogen strategies of Japan, South Korea and European countries, the point of self-sufficiency of their economies with the necessary amount of hydrogen is generally omitted.
In Germany, it is generally stated that Russia should supply them with hydrogen, so there should be no problems with the transition to a hydrogen economy by 2050 (see paragraph 38 of Germany’s hydrogen strategy).
In Russia, according to the hydrogen strategy, by 2024 the economic model of the hydrogen economy itself, with all its derivatives (production of methane-hydrogen mixtures; production of turbine units capable of operating on hydrogen; production of hydrogen transport) should be developed and substantiated. Gazprom is developing a technology for producing “blue” hydrogen. Rosatom is developing a technology for producing “yellow” hydrogen (electrolysis of water at nuclear power plants and the construction of a nuclear power plant for the direct production of hydrogen by high-temperature electrolysis).
Even old Europe is not so optimistic about green hydrogen anymore. Europe suddenly equated the ecological footprint of nuclear power plants in her 387-page study posted on the European Commission’s JRC SCIENCE FOR POLICY REPORT to the ecological footprint of wind and solar power plants.
This is because there is no other way to realize the mass and, most importantly, cheap production of “green” hydrogen, on which Europe relies heavily. Well, this somehow saves the very concept of environmentally friendly hydrogen.
However, in Russia, quite recently, the development of a project began, which is still able to revive the original concept of precisely “green” hydrogen. As the use of water and a renewable environmentally friendly source of energy. This project, worth more than $ 300 billion, will pay off in just 5 years. It will fully provide Europe with the necessary amount of “green” hydrogen. At the same time, Russia itself by 2050 will become the world’s largest producer of hydrogen of all “colors”. And 85% of the total world production of “green” hydrogen will be generated by Russian power plants.
One of the most interesting novelties of the Army-2021 forum was the new version of the PPK-20 submachine gun. It was presented by the Kalashnikov concern. This product is designed in the interests of the aerospace forces. The submachine gun is optimized for use in the equipment of military pilots and should provide their self-defense in emergency situations.
By order of the Ministry of Defense
The development of a promising submachine gun for the armed forces began several years ago. It was carried out within the framework of the Vityaz-MO ROC. The purpose of the work was to create an automatic weapon for a pistol cartridge for use in various structures of the army. Accordingly, it was required to provide high fire performance with limited dimensions and weight.
The first reports on the results of the ROC in the open press refer to the last year. So, in July, the Kalashnikov concern announced the successful completion of state tests. The interdepartmental commission recognized the product as meeting the customer’s requirements and suitable for mass production. It was recommended to assign the name of the new development “Kalashnikov submachine gun mod. 2020 “- in memory of the designer V.M. Kalashnikov, who laid the foundations for a modern line of such weapons.
PPK-20 in its configuration last year externally significantly differed from the Vityaz-SN. The new version of the weapon for the Aerospace Forces also received a number of components that change its exterior and affect the ease of use.
One of the main requirements of the Aerospace Forces concerned the maximum reduction in the size of the weapon. In this regard, the submachine gun received a telescopic butt, folded by turning forward and to the right. When folded, the PPK-20 with a standard muzzle device has a length of only 410 mm. Unladen weight of the product, without ammunition, scope, etc. – 2.5 kg.
USM both PPK-20 retained the long flag of the fuse-translator of fire, characteristic of the AK. In the new modification, it was supplemented with small levers on the same axis, located on both sides of the weapon. This allows you to engage the safety or select the fire mode without removing the leading hand from the handle.
The weapon received a new forend with strips and slots for mounting the necessary devices. “Last year’s” PPK-20 has a bar only at the bottom, the new one – at the top and bottom. A similar bar is provided on the receiver cover. Mechanical sights are preserved in the front and rear of the forend and cover.
The PPK-20 kit includes a silent firing device. If necessary, it is installed directly on the flame arrester using a bayonet connection. This operation takes minimal time, but provides a dramatic reduction in noise and flash.
Here we are sinking in the next energy crisis. This time it will be ”green”. Gas prices are rising like cryptocurrencies, oil has exceeded levels unseen since 2018. How will it end? And most importantly – when?
Georgy Bovt candidate of historical sciences, political scientist
What is happening these days and weeks in Europe? Off-scale gas prices (some ten days ago, some doubted whether they would surpass $ 1,000 per thousand cubic meters, and on October 6 they came close to 2,000). And ill-considered, hasty abandonment of traditional forms of energy in favor of green energy.
Coal prices, by the way, are also hitting records. In some countries (in the UK, for example) they are even thinking about the reopening of coal mines. China also made a significant contribution to the rise in coal prices by banning the export of coal to one of its largest producers. They themselves, they say, do not have enough.
Energy companies are a big winners. The value of shares of the Gazprom is breaking records. Together with the oil industry, it pulls the entire domestic (Russian) stock market with it. The question is how long this feast will last during the coronavirus plague. The 30-fold increase in the gas price compared to May 2020 can hardly be called normal. Even taking into account the fact that in this case we are talking about futures, and the growth of the real price is much less. It is still very significant, and cannot pass without leaving a trace for the rest of the economy.
I must say that the European Union itself planted this bomb when, quite recently, it began to demand that the market switch to short-term contracts, which are obviously more volatile. Most recently, this has been superimposed on such a purely technical exchange factor as massive margin calls at hedge funds. Those who decided to play “bears”, believing that prices simply have nowhere to rise higher, were cruelly mistaken. For tens of billions of dollars.
Preconditions for this crysis were formed back in the northern summer
The preconditions for the market acceleration were formed back in the summer. It turned out to be unusually hot increasing, in particular, the demand for electricity air conditioners. This was superimposed on a sharp increase in demand from China. It was the first to emerge from the coronavirus economic torpor. Already in the summer, the main supplies of LNG were switched to Southeast Asia. Some in the EU considered it important to counter “gas dependence on Russia.” The reduction in supplies to Europe reached 20%. These volumes were not replenished by anyone, including the Americans, who previously praised their LNG as a means of liberation from the “energy diktat of Moscow.” Americans (and everyone else) could not resist big price increase in Asia.
It is also worth noting that Europe’s own gas production continued to decline. This happened due to the depletion of explored deposits and against the background of the refusal to develop new ones for the sake of the “green energy transition”. That resulting in reduction and then a complete cessation of such investments.
Who they will blame?
Gazprom made its own small contribution. It has never booked additional volumes of supplies through Ukraine this year. Everything is clear according to the letter of the 2019 transit agreement with the Ukrainian Naftogaz. Strictly speaking, Gazprom was not obliged to do this. A contract is a contract: business, nothing personal. Also, the Russian gas monopoly short-term cut by 10% in August supplies through the Yamal-Europe pipeline and stopped selling gas through the electronic trading platform for a year in advance. It should be noted that gas supplies from Russia to Europe in January-June increased by 17 billion cubic meters compared to the same period last year. By the end of September the increase was already 18 billion cubic meters – while other suppliers did not increase exports. So Gazprom did not violate any obligations.
However, the inevitable search for the “extreme” in such a situation may force some in the West to again “blame” Moscow. . And also China, which buys up everything on the market with a vacuum cleaner. Not America, which, although it did not fulfill its promises, but they were not contracted. . And you certainly cannot blame those who do not want to abandon the provisions of the Third Energy Package (EU). According to that Gazprom will not be able to use more than half of the pipe’s (Nord Stream 2) capacity. Yet for the sake of life-giving competition!
The short-term consequences of the energy crisis are quite predictable. This is, firstly, the surge in inflation around the world, which is already pumped up by trillions of emissions of dollars, euros and yen, committed to support economies (and stock markets) in the midst of a pandemic.
Transition to “green energy” will be long and expensive
A number of countries have started talking about rationalizing energy supplies. China has actually started to do this. And his example is very revealing and clearly demonstrates that the transition to “green energy” will be difficult, long and expensive.
Power generation in China is more than 70% dependent on coal. It is the dirtiest source of energy in terms of greenhouse gas emissions. However it is one of the cheapest. The CCP has set a goal of achieving a carbon neutral economy by 2060 – ten years after the European Union. Well, once the party (CCP) has set a goal, it must be fulfilled. Investment in the coal industry is falling and so is production. So far, it has not been possible to fill the shortage with renewable energy.
The example of China and Europe suggests that all of this is just the beginning of a long journey towards green energy. The current crisis can rightfully be called the First World Crisis of the Green Transition. And such excesses will repeat and grow. The process will continue not for years, but for decades. Energy systems – at least temporarily, until the right balance is found – are becoming more vulnerable, not more resilient (including to the vagaries of the weather). And it will be very difficult to find and maintain this balance.
Where will electricity come from?
Only one conversion of road transport to electricity will lead to an increase in demand for it by 20-30%. Where will it come from? How difficult will this very “energy transition” be made by growing inflation (as a consequence of the general rise in energy prices) in combination with increased price volatility? Nobody knows yet. That is, with a high probability, the “energy transition” will be accompanied not by economic growth, but by an economic recession or stagnation against the background of shocks in certain sectors of the economy.
Spurred on by loud political slogans (and the corresponding actions of state regulators), investors are heavily investing in “renewable energy”. That is certainly good thing but they are stopping investing in traditional ones. Wind and solar electricity must be stored somewhere, it is not coal, which can be taken out of the ground as needed. This means that huge storage capacities are needed.
In business, this is called unpredictability. And it costs money. The technological solution to this problem takes time – and also money. Until recently, a model worked in Europe. Gas generation served as insurance for renewable energy. However, insurance does not work properly in the face of such a sharp rise in prices.
Of course, the scale of the catastrophe that happened should not be exaggerated. And all the more, you shouldn’t bury the “green energy”. At stake is survival on planet Earth and preservation of its climate in a form acceptable to the human race. As the current crisis is overcome, new long-term solutions will be found.