“Our past mistakes still make us very vulnerable” – L’Express

Behind Fatih Birol’s back, the immutable Eiffel Tower rises towards the sky. At the time of its construction, at the end of the 19th century, nothing seemed impossible for the industry, which was experiencing an unprecedented wave of innovations. A century and a half later, everything has changed. The director of the AIE notes a slowing European economy, undermined by bad choices from which it is struggling to escape. Certainly, since the shock of the energy crisis which hit the Old Continent following the war in Ukraine in February 2022, European countries have been able to meet the challenge of replacing Russian gas, but they continue to pay their “strategic errors”. Fatih Birol cites three: monodependence on gas, the gradual abandonment of nuclear power in recent decades and the reduction in effort in the development of solar panels.

“We must remember that twenty years ago it was the European countries which first developed this energy. But after a few years Europe gave up, and China took over. As a result, China today produces more than 80% of the world’s solar energy,” he emphasizes. The expert takes the opportunity to recall the importance of having national energy production. “What is happening in the Middle East shows us once again that gas and oil may not be safe choices for consumers. So it is very important to produce at home and import less. For me , nuclear and renewable energies therefore have a major role to play, not only from the point of view of greenhouse gas emissions, but also from the point of view of energy security.”

Last winter we were lucky. Gas shortages did not occur. Good news to be credited to governments and the European Commission, who were able to find new sources of supply, but also relatively mild weather, accompanied by limited economic growth in Asia. Over the coming months, Europe should once again avoid the worst, since its reserves are at their highest. But this situation is misleading. “Our past mistakes still make us very vulnerable,” assures the director of the IEA. The European economy was built on abundant and cheap Russian energy. But this period is over. “It’s over,” continues Fatih Birol, in French to support his point. Gas prices, although they may fall in the short term, are expected to remain high. All analysts agree on this point. “However, when you produce steel, cars or cement, the cost of energy is central. Today, with imports of liquefied natural gas, European manufacturers pay four times more for gas than in the United States, and the electricity we consume is three times more expensive than in China,” assures the economist. As a result, we consume less energy. Not due to the efficiency of processes, but by the underutilization of our industrial capacities.

“Europe needs a new master plan for industry,” he says. And the European Commission, but especially France and Germany, must develop this strategy, by doubling down on decarbonization. Faced with the amounts invested by the United States through its recovery program oriented towards renewable energies and the omnipresence of China in the field, Europe is struggling to play in the big leagues despite a proactive policy. “Our strategy towards China is extremely important, and we must recognize its overwhelming dominance in certain sectors.” The director of the IEA stands up, digs through a pile of documents and grabs a graph summarizing the situation: “China represents 80% of the world’s production of batteries and solar panels, 70% of wind power and 40% of hydrogen… We can’t compete. In several areas it’s too late, the game is over.”

Europe will therefore have to choose its battles. Fortunately, in certain sectors, there is still a place to be taken. “Electrolyzers for the production of hydrogen, offshore wind turbines, heat pumps, etc., there are many technologies on which European industry must focus,” argues Fatih Birol. The economist sees this specialization as the main challenge of tomorrow. Anxious to make himself understood, he specifies: “It is not a question of making industry rich, but of preserving the backbone of the economy. That is the challenge.” What if Europe failed? The consequences would be major: industrial downgrading, loss of jobs… “The slide has already started. I fear that this will constitute fertile ground for the most extreme political groups,” he warns.

Pinned on a wall, the certificate of the Legion of Honor, of which he has been a knight since 2021. An award received the same year as the publication by his agency of a roadmap for carbon neutrality in 2050. A founding document, which sets a simple rule: to achieve this goal, the world must immediately abandon any new oil and gas extraction projects. Although taken up worldwide, and confirmed by the work of the IPCC, which reached the same conclusions, this message still remains wishful thinking today. Ahead of COP 28 which opens on Friday November 30 in Dubai in the oil-rich United Arab Emirates, all the signals are red. We question him about the annual report of the United Nations Environment Program published at the beginning of November. The document notes that the projects of the 20 main producing countries would generate, in 2030, 110% more fossil fuels than would be compatible with limiting warming to 1.5 degrees. Far from the instructions issued by his agency.

“We can’t have it all: both increase coal and oil production and hope to achieve our climate goals. It’s very simple, and even my mother understands that, he quips. COP 28 is a moment of truth for oil and gas producers. We have a plan in our report for ‘net zero’ in 2050, and they need to stick to it.” The president of the IEA presents himself as an arbiter of the decisions of oil producers. In a special report published on November 23, the Agency calls on the sector to devote half of its investments to clean energy by 2030. Fatih Birol warns: “We can talk about the risks that this represents for the climate, but we must also talk about the economic risk that this represents for their economy.” Global oil demand is expected to peak before 2030, the agency’s latest annual report warns. “Just three years ago, 1 in 25 cars sold was electric, but the world is changing, and quickly: this year, this figure fell to 1 in 5.

But that’s not all. The Chinese economy is slowing down, but over the last ten years, it has been responsible for two thirds of the increase in oil consumption,” notes Fatih Birol. He also hastens to counter the argument of oil companies that the demand for hydrocarbons will come primarily from developing countries. “What we see is that the growth coming from India and other countries will not compensate for this decline due to the slowdown in other countries. Which means that betting that the world will always need a lot of oil is very risky, and companies should be very careful, because they have a lot to lose.” Not sure that the alert will hit the mark in Dubai.