Governing the Global Energy Transformation

An effective and efficient governance is key for the global energy transformation. We argue that the process under the Paris Agreement, its ‘rulebook’ and the nationally determined contributions (NDCs) will have to be accompanied by focused and tailored governance mechanisms in the energy realm. The energy sector itself is key to limiting global warming to two degrees centigrade compared to the preindustrial level, because it is responsible for over two-thirds of global greenhouse gas emissions. Yet, neither the energy transition nor energy governance start from scratch. Energy governance is already happening on many levels: the local, the national, the regional and the global. These multi-level governance structures are necessary to enable, facilitate, and accelerate the energy transition(s) on the ground. They have to be adapted, however, to the changing and transforming energy world as we argue in the conclusions. In a first step, we conceptualize the notion of ‘energy transition’ and relate it to the concept of ‘energy transformation’. We argue that it is necessary to firstly move beyond the normative and target-driven idea(s) behind ‘transition’ and to secondly bring in the systemic aspects of energy transformation. Moreover, energy security, economic efficiency, sustainability and climate neutrality have emerged over time as the guiding paradigms, forming a strategic quadrangle, as opposed to a strategic triangle, traditionally used to define energy security. In a second step, we present an overview of the current international energy governance system where multilayered governance structures have developed over time. We argue that the existing architecture is stemming from the past and is neither fit for governing the energy transition, nor even reflecting the proccesses underway in todays’ world. In a third step, we highlight that the energy transformation has and will have tremendous techno-economic, socio-technical and political (Cherp et al. 2018) effects that have both internal and external dimensions. Moreover, the transformation comes with (geo)political effects as it changes the political economy of energy on all levels: the global, the regional, the national and the local. In the final step, we look at ways forward. We argue that it is necessary to preserve existing multilateral institutions and to strengthen them. Moreover, we assume that governance approaches towards and inside regions will have to be re-shaped or even created from scratch. We conclude that the crumbling of the global liberal order and the crises of multilateralism are complicating the approach to a better governance of the energy transition on the global level. Moreover, we witness the emergence of illiberal tendencies in the Western democracies as well. Climate and energy are playing into the polarization of societies as the two topics emerged as a major cleavage and a conflict line. We emphasize that a just and inclusive energy transition, both on national and international levels, is necessary to keep countries and the world on a sustainable energy transformation path. The challenge faced by the planet is indeed systemic.