Addressing the energy trilemma has been a challenge for governments, companies, and even individuals for years. Trying to improve only one aspect — energy supply security, energy cost, or environmental impact — has often led to worse outcomes for the others. But the increase in fossil fuel prices, combined with ongoing advancement in renewable technologies, makes it now possible to concurrently address each portion of the energy trilemma.
As companies align their business goals and operations with societal expectations and regulatory trends, they face the inherent tensions of the energy trilemma. Simply put, companies will need reliable, affordable, and clean energy to operate. As they do so, they should expect to enhance their reputation and minimize long-term environmental risks, as well as achieve cost savings with the advancement in technology and economies of scale.
Historically, it has not been easy to find energy solutions that effectively address each dimension of the energy trilemma, which led to companies continuing to rely on fossil fuels. Recent geopolitical issues have led to volatility around energy supply and energy prices globally, which has been an opportunity for governments and organizations to reassess the status quo. Europe had become overly reliant on Russia for its supply of natural gas and was now looking for other suppliers globally. The U.S. reaffirmed its reliance on fossil fuels, expanding fracking and discussions around strategic oil reserves. Neither of these approaches addressed the environmental impacts.
The fact remains that investing in renewable energy now is the most attractive short-term and long-term option — and addresses each aspect of the energy trilemma.
Renewables are becoming less expensive, are more readily (and locally) available than they have been previously, and have a shallow environmental impact. They include energy production for heating (e.g. biogas and geothermal sources) and electricity generation (e.g. on-site solar systems, wind turbines, combined heat and power). Some examples of potential interventions include:
These trends have gained momentum as the levelized cost of electricity (LCOE) from renewables has had a downward trend over the last few years. Companies can now bridge the gap between sustainability, energy security, and affordability by strategically adopting renewable energy solutions.
Specific needs and challenges vary between sectors and across regions. The regulatory framework and cost variations also continue to play a major role in these decisions. But even if solutions are not immediately available to instantly decarbonize every organization, steps can be taken now to address each aspect of the energy trilemma for a long-term decarbonization strategy.
Manufacturing Decarbonization Is Economically Viable With 5 Proven Technologies
ENGIE Impact’s ongoing assessments of industrial and manufacturing sites have shown that decarbonization is economically viable today, that many of the financial risks of site-level interventions are a thing of the past, and that the greatest risk posed to organizations currently is inaction. There are now proven technologies, cheaper energy sources, and shorter payback periods that allow any organization to commit to a bold decarbonization strategy and program.
Our research shows:
Financing support from legislations such as the Inflation Reduction Act, and the EU Innovation Fund, as well as new financing models like Energy Savings as a Service (ESaaS), also make the transition to renewables easier — helping overcome each challenge that’s part of the energy trilemma.
The energy trilemma has always been present, posing a significant challenge for companies across industries and around the world. However, it is possible to efficiently address it now due to major advances in renewables, increasing stringent regulations, as well as innovative financing models available in the market. Companies recognizing the trilemma's challenges must see that adopting renewables is the key to reliable, affordable, and clean energy — with the added benefits of enhancing reputation and cutting long-term costs. Renewables, with decreasing costs and environmental impact, offer a comprehensive solution, and the data supports its economic viability. Committing to renewables now aligns with both economic and environmental imperatives.
Let’s work together to accelerate your renewables strategy.
