Prepare for more shocks in global transition out of fossil-fuel addiction

THE energy crisis in China, as well as in Europe, is spilling over into economic forecasts and supply chains, and threatening to derail global growth.

China - the world's largest factory that is primarily powered by coal - is scrambling to lay its hands on more coal as a supply crunch is forcing the country to ration power, resulting in electricity blackouts that are hobbling nearly half of its industrial production. Key suppliers to technology giants such as Apple, Tesla and Microsoft have ceased or cut operations. With agricultural processing plants forced to go dark too, food costs are expected to rise. Over in Europe, a confluence of factors - ranging from low natural-gas stockpiles and overseas shipments, lacklustre output from the region's windmills and solar farms, and maintenance work that has put nuclear generators and other plants offline - have caused a surge in electricity costs.

Both crises are wake-up calls for the world as it transitions from dirty fossil fuel to clean energy. While climate goals are critical and urgent, clean energy transition must be done in a calibrated manner. A hurried or knee-jerk shift can spell trouble and result in a series of energy crises that would have far reaching consequences on global growth, and may even be counter-productive.