According to the public relations of Aghah Investment Group, Dr. Amirali Raeisi, an economic activist, in the editorial of Setareh Sobh newspaper, referred to the energy imbalance crisis and the repeated closures of government offices and educational centers, and identified diversifying the energy production portfolio as a solution to address this issue. The detailed version of this note is as follows:
The Russian military invasion of Ukraine on February 24, 2022, and the subsequent energy crisis in the European Union is a real-life example of how dependency on a single source for energy supply always carries the potential to create a major national crisis.
In 2021, over a third of the EU’s gas came from Russia, a figure which dropped to 15% by 2023!
On the other hand, the energy crisis following Russia’s invasion of Ukraine became one of the main causes of inflation, contributing to an 8.5% increase in inflation rates. In some of the larger European economies, the situation was even more difficult. For example, in Italy, inflation reached nearly 11%. Additionally, in the United Kingdom, which is outside the Eurozone, inflation broke a 40-year record during mid-winter last year, rising to over 11% and remains in double digits. According to the UK’s Office for National Statistics, from March 2022 to March 2023 (i.e., during the Persian year 1401), electricity prices rose by 66.7% and gas prices increased by 129.4%. Furthermore, the UK’s electricity and gas market regulator, Ofgem, states that despite the decline in energy prices in international markets, energy costs for households continue to rise.
Energy imbalance in Iran is also a product of a similar experience to Europe in gas supply. The lack of diversification in energy production and reliance on a single source has shaped the current gas production situation in the country. Just as Europe became dependent on Russian gas, Iran is now dependent on electricity production through fossil fuels. This dependency becomes problematic when electricity production relies on thermal power plants fueled by gas, as increased energy consumption will lead to imbalance and power outages.
According to the monthly report of the Ministry of Energy’s Water and Electricity Industry Statistics until Farvardin 1403, over 86% of the electricity produced in the country depends on natural gas, about 9% on petroleum products, and less than 5% comes from other sources (hydropower, nuclear, and renewables).
Diversification of the country’s energy portfolio and the shift toward the use of renewable energy instead of hydrocarbon fuels are among the effective solutions to address the energy imbalance challenges in the country. Therefore, it is necessary for us to prioritize energy consumption optimization and energy portfolio diversification in order to successfully solve the energy imbalance.
Iran ranks 131st in the world in terms of diversification of its electricity production portfolio. This highlights the need for investment in renewable energies such as solar and wind.
Global statistics show that since 2019, investment in renewable power plants has been twice as high as in fossil fuel power plants, with renewables occupying a prominent position in developed countries. Therefore, the use of renewable energy is an alternative option for electricity production in the country. A solution that not only requires no human resources but also represents an inexhaustible source and causes the least pollution for the environment and air.
