CNN Business
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In Sri LankaPeople queue up for miles to fill the fuel tank. Shops in Bangladesh close at 8 pm to save electricity. In India and Pakistan, power outages have forced schools to close, businesses to close and residents without air-conditioning to swallow through deadly heat waves in which temperatures exceed 100 degrees Fahrenheit. (37 °C) above.
These are some of the more fascinating scenes going on in the Asia Pacific region, where countries are facing their worst energy crisis in years – and grappling with growing discontent and instability, fueled by rising costs of living. ,
The sense of crisis is evident in Sri Lanka and Pakistan. Public anger has already caused a wave of resignations of ministers in Colombo and contributed to the downfall of Imran Khan as prime minister in Islamabad.
Yet many suspect that the political reckoning has just begun; Both countries have been forced into desperate measures to limit the International Monetary Fund and introduce shorter working weeks in an effort to save energy. On Wednesday, Prime Minister Ranil Wickremesinghe said that the economy of Sri Lanka “Completely collapsed.”
Elsewhere in the region, signs of trouble may be less obvious, but may have far-reaching consequences. Even in comparatively affluent countries like Australia, economic concerns have begun to emerge as consumers feel the sting of high energy bills.
The wholesale prices of electricity in the first quarter of 2022 were up 141% from last year; Homes are being urged to cut use and on 15 June – for the first time ever – the Australian government indefinitely suspended the national electricity market To bring down prices, reduce pressure on the energy supply chain and prevent blackouts.
But it is the experience of India, where electricity demand has recently hit record highs, that most clearly shows why this is a global rather than a regional crisis.
After suffering extensive losses amid record temperatures, the world’s third largest carbon emitter on May 28 announced that Coal India would import coal for the first time since 2015.
While each of these countries faces a unique set of circumstances, all have been affected by dual effects. coronavirus pandemic And Russian war in Ukraine Two unexpected events that have turned previously justified assumptions about supply lines and regional security on their head and plunged the world of economic planning into chaos in the process.
Experts say that fundamentally the problem lies in the growing mismatch between supply and demand.
Over the years, the pandemic has kept energy demand unusually low, With the decline in global electricity consumption more than 3% In the first quarter of 2020, lockdowns and other restrictions kept workers at home, cars off the road and ships stuck in ports.
But now, as nations begin to put the pandemic behind them, fuel demand is on the rise – and sudden competition is pushing coal, oil and gas prices to record highs.
Turbo-charging This trend is Russia’s invasion of Ukraine, World’s third largest oil producer and second largest crude oil exporter, With the approval of Russian oil and gas by the United States and many of its allies, many countries have been left scrambling to find alternative sources – heating up the competition for limited supplies even further.
“The coronavirus has caused energy demand to grow faster and faster than supply,” said Samantha Gross, director of the Brookings Institute’s Energy Security and Climate Initiative.
“So we saw high prices even before Russia’s invasion of Ukraine (but there was then) was really a blow to the energy supply. The various actions taken in response to this are really a challenge to energy supply globally. ”
While the price of energy imports is Risen Dramatically around the world, international coal prices are five times higher than a year ago and natural gas prices 10 times higher than last year, experts say, prompting some Asian economies – especially import-dependent , developing – are the most difficult.
“If you’re a country, especially an emerging economy like Sri Lanka that has to buy those commodities, buy oil, buy natural gas, it’s a real struggle,” said Mark Zandi, chief economist at Moody’s Analytics. ,
“You’re paying too much for the things you need, but the prices of the things you sell haven’t gone up. So you’re spending too much money trying to buy the same things to keep your economy running.” are.”
Poorer countries that are still developing or newly industrialized are more able to compete with deep-pocketed rivals – and the more they need to import, the bigger their problem, according to Columbia University’s Center on said Antoine Half, assistant senior research scholar at Global. energy policy.
“So Pakistan definitely fits there. I think Sri Lanka fits there too,” he said. “They are taking a price hit but they are also taking a supply hit. They have to pay more for their energy supply and in some countries like Pakistan, they actually have difficulty getting energy.”
This dynamic is behind the increasingly chaotic scenes in those countries.
As recently as a week ago, the Minister of Energy and Energy of Sri Lanka Told It was only a few days before the country ran out of fuel. The foggy warning came as lines stretched for 3 kilometers (about 2 miles) at fuel stations in Colombo and clashes between police and the public in several cities.
It is almost as if everyday life itself is closing in. On Monday, public sector offices, government schools and government-approved private schools remained closed for at least two weeks. Public sector employees have been asked to take Friday off for the next three months – with suggestions to make good use of the time grow your own food,
Pakistan has also had to reduce its working week from six to five days, though this may worsen the situation. Its six-day week, which was introduced recently, was supposed to improve productivity and boost the economy.
Instead, power cuts of daily hours for at least a month have plagued the country of 220 million and prompted malls and restaurants in Pakistan’s largest city Karachi to close early to save fuel.
The country’s energy supply is About 5,000 megawatts less than demand—a shortfall that electricity could deliver among 2 million and 5 million homes some guesses,
Information Minister Maryam as Aurangzeb put it on june 7: “We are facing a serious crisis.”
And any notion that such problems are only a matter for poorer, less developed nations is dispelled by the experience of Australia – a country with the world’s highest level of global average wealth per adult.
Since May, “Lucky Country” has been operating without 25% of its coal-fired power capacity – partly because of a planned outage for maintenance, but also because supply disruptions and rising prices caused unplanned outages. has made it.
Like their counterparts in Pakistan and Bangladesh, Australians are now being urged to conserve, Energy Minister Chris Bowen recently asked homes in New South Wales, which includes Sydney, to power for two hours each evening. not to use.
The reaction of these countries could create an even bigger problem than rising prices.
Under public pressure, governments and politicians may be tempted to turn to cheaper, dirtier forms of energy such as coal, regardless of the impact on climate change.
And there are signs that it has already started.
In Australia, the Energy Security Board of the federal government as proposed Pay all electricity generators, including coal-fired ones, to have excess capacity in the national grid to prevent power cuts. And the government of New South Wales has used emergency powers to redirect coal from mines in the state to local generators instead of overseas.
Both measures have come in for criticism from those who accuse the government of betraying its commitment to renewable energy.
In India, a country of 1.3 billion people who depend on coal for nearly 70% of its energy production, New Delhi’s decision to increase coal imports is likely to have an even deeper environmental impact.
Scientists say a drastic reduction in coal mining is necessary to limit the worst effects of global warming, yet it would be difficult to achieve without the purchase of one of the world’s biggest carbon emitters.
“Any country, be it India, Germany, America, if they double any kind of fossil fuel it will eat up the carbon budget. This is a global problem,” said Sandeep Pai, senior research head at the Center for Strategic and International Studies’ Energy Program.
While Pai said India’s decision may only be a temporary “crisis response”, if in a year or two’s time countries continue to rely on coal, it will significantly impact the war on global warming.
“If these actions take place, it will eat away at the carbon budget that is already shrinking in India and increase by 1.5 or 2 degrees,” Pai said, referring to the Paris climate agreement’s goal of maintaining growth in the global average. The goal will become increasingly difficult.” Temperature between 1.5 and 2 °C.
If the rise in temperature exceeds that limit, even temporarily, scientists suggest Some of the resulting changes to the planet may be irreversible.
As Pai put it: “India’s scale and size and demand mean that if it really doubles down on coal, we’re going to have a really serious problem from a climate standpoint.”