Moving away from fossil fuels will be costly; so is inaction

Focusing solely on transition costs misses big picture; climate impact is already clear

- Shabana Begum

Over the past week, the cost of the global transition away from fossil fuels was a key point of discussion during the Singapore International Energy Week, a major energy conference held between Oct 21 and 25.

But what was less talked about then was how these costs would stack up against the costs of doing nothing.

It is undeniable that the global energy transition will come at a cost. Fossil fuels have driven economies for decades, and moving away from this status quo will not come easily or cheaply.

For example, Singapore announced during the event that it had given conditional approval for a company here to start importing solar energy from Australia via more than 4,000km of cables, in a mega project expected to cost US$24 billion (S$31.6 billion).

Then there is also the cost of upgrading the grid infrastructure, since the transmission network has to be girded up to allow the reliable transfer of electricity from various generation sources - whether it is a solar farm in Australia or hydropower dams in Laos - to people's homes and offices.

At the conference, the head of the world's largest oil company, Aramco, even said it was "unrealistic" and "too expensive" for developing countries to transition away from fossil fuels, because these countries will require a "staggering amount of front-end capital" to drive the transition.

But focusing solely on the costs of the transition would be missing the big picture, especially with climate impact already being felt here and now.