Public Disclosure Authorized Public Disclosure Authorized Public Disclosure Authorized NET ZERO ENERGY BY 2060 Charting the Path of Europe and Central Asia Toward a Secure and Sustainable Energy Future Public Disclosure Authorized CONTENTS Abbreviations and acronyms..........................................................................................................6 Definitions of subregions.................................................................................................................7 Acknowledgments............................................................................................................................8 Executive summary........................................................................................................................10 Country coverage.............................................................................................................................11 Key findings on short-term energy security.................................................................................11 Key findings on the energy transition and energy security in the longer term.......................13 The use of coal, oil, and gas in the region is on the decline through 2060.....................14 Renewable energy can gradually replace fossil fuels, aided by energy efficiency.........14 Greater investment will be needed to achieve the Net Zero 2060 goal..........................15 Part 1 • Short-term energy security in the region: The crisis is not over.................................17 Redefining energy security..............................................................................................................17 Gas security.......................................................................................................................................19 Impact on Russia’s gas production.......................................................................................22 Impact on countries in the region.........................................................................................23 Gas security in the EU4 and Western Balkan countries.....................................................26 Gas security in Central Asia....................................................................................................27 The limits of Türkiye’s ability to absorb Russia’s surplus gas............................................28 Oil security: Ongoing shifts.............................................................................................................30 Energy security and the energy transition....................................................................................35 Part 2 • The energy transition: A pathway to a net zero region by 2060..................................37 What does it take to decarbonize the region?.............................................................................42 Transforming the region’s gas sector............................................................................................45 Developing a hydrogen sector........................................................................................................48 Transforming the region’s power sector.......................................................................................52 The importance of system flexibility for increasing the role of renewables...................55 The combined effect of better demand response and heightened production of green hydrogen.......................................................................................................................59 The role of regional power exchanges for energy security...............................................59 Transforming energy use in the transport, buildings, and industrial sectors.........................62 Buildings...................................................................................................................................63 Transport..................................................................................................................................65 Industry.............................................................................................................