The hydrocarbon producing countries of the MENA region believe in their preeminent albeit shrinking source of revenues for decades. But, as shown by some counties of the Gulf net-zero recent pledge, they see economic and political opportunities in moving to the green energy transition. Accelerated renewables-based electrification paves the way for a post-fossil future by Nature Energy explains how the world and particularly the EU in order to achieve its climate and geopolitical goals, it will need to substantially increase its engagement with Gulf states.
Accelerated renewables-based electrification paves the way for a post-fossil future
The research was published in Nature Energy.
Cost-slashing innovations are underway in the electric power sector and could give electricity the lead over fossil-based combustion fuels in the world’s energy supply by mid-century. When combined with a global carbon price, these developments can catalyze emission reductions to reach the Paris climate targets, while reducing the need for controversial negative emissions, a new study finds.
“Today, 80 percent of all energy demands for industry, mobility or heating buildings is met by burning—mostly fossil—fuels directly, and only 20 percent by electricity. Our research finds that relation can be pretty much reversed by 2050, making the easy-to-decarbonise electricity the mainstay of global energy supply,” says Gunnar Luderer, author of the new study and researcher the Potsdam Institute for Climate Impact Research. “For the longest time, fossil fuels were cheap and accessible, whilst electricity was the precious and pricier source of energy. Renewable electricity generation—especially from solar photovoltaics—has become cheaper at breath-taking speed, a pace that most climate models have so far underestimated. Over the last decade, alone prices for solar electricity fell by 80 percent, and further cost reductions are expected in the future. This development has the potential to fundamentally revolutionize energy systems. Our computer simulations show that together with global carbon pricing, green electricity can become the cheapest form of energy by 2050, and supply up to three quarters of all demand.”
The reasons lie mainly in the ground-breaking technological progress in solar and wind power generation, but also, in the end, uses of electric energy. Costs per kilowatt hour solar or wind power are steeply falling while battery technology e.g. in cars is improving at great speed. Heat pumps use less energy per unit of heat output than any type of boiler and are becoming increasingly competitive not only in buildings, but also in industrial applications. “You can electrify more end-uses than you think and for those cases actually reduce the energy consumption compared to current levels,” explains Silvia Madeddu, co-author and also researcher at the Potsdam Institute.
“Take steel production: Electrifying the melting of recycled steel, the so-called secondary steel, reduces the total process energy required and lowers the carbon intensity per ton of steel produced,” says Madeddu. “All in all, we find that more than half of all energy demand from industry can be electrified by 2050.” However, some bottlenecks to electrification do remain, the researchers point out. Slowest in the race to decarbonisation are long-haul aviation, shipping, and chemical feedstocks, i.e. fossil fuels used as raw materials in chemicals production.
Limiting the reliance on negative emissions
The scale of the technological progress holds great opportunities for countries to leapfrog and for investors alike. However, not every technology is a success story so far. “In this study, we constrained the reliance on technologies which aim at taking carbon out of the atmosphere, simply because they have proven to be more difficult to scale than previously anticipated: Carbon Capture and Storage has not seen the sharp fall in costs that, say, solar power has. Biomass, in turn, crucially competes with food production for land use,” Luderer lays out. “Interestingly, we found that the accelerated electrification of energy demands can more than compensate for a shortfall of biomass and CCS, still keeping the 1.5 degrees Celsius goal within reach while reducing land requirements for energy crops by two thirds.”
Era of electricity will come—but global climate policy must accelerate it to meet climate goals
“The era of electricity will come either way. But only sweeping regulation of fossil fuels across sectors and world regions—most importantly some form of carbon pricing—can ensure it happens in due time to reach 1.5 degrees,” Luderer says. Indeed, the simulations show that even if no climate policy at all is enacted, electricity will double in share over the course of the century. Yet in order to meet the goals of the Paris Agreement of limiting global warming to well below two degrees, decisive and global political coordination is crucial: pricing carbon, scrapping levies on electricity, expanding grid infrastructure, and redesigning electricity markets to reward storage and flexible demands. Here, hydrogen will be a crucial chain link, as it can flexibly convert renewable electricity into green fuels for sectors that cannot be electrified directly. “If these elements come together, the prospects of a renewables-based green energy future look truly electrifying,” says Luderer.
Greening deserts in which India powers renewable energy ambitions with solar push could be a good inspiring move for all those countries of the MENA region. An initiative commensurate with this country’s Prime Minister’s words at the COP26.
Greening deserts: India powers renewable energy ambitions with solar push.
The image above is of The arid state of Rajasthan, where Bhadla Park takes up an area almost the size of San Marino, sees 325 sunny days each year, making it perfectly placed for the solar power revolution, officials say. Image by Money Sharma/AFP via Getty Images
The arid state of Rajasthan sees 325 sunny days each year, making it perfectly placed for the solar power revolution
As camels munch on the fringes of Thar desert, an oasis of blue solar panels stretches further than the eye can see at Bhadla Park—a cornerstone of India’s bid to become a clean energy powerhouse. Currently, coal powers 70 percent of the nation’s electricity generation, but Indian Prime Minister Narendra Modi has pledged that by 2030, India will produce more energy through solar and other renewables than its entire grid now.
“First, India will increase its non-fossil energy capacity to 500 gigawatts… Second, by 2030, 50 percent of our energy requirements will come from renewable resources,” Modi told the COP26 climate summit in Glasgow.
The arid state of Rajasthan, where Bhadla Park takes up an area almost the size of San Marino, sees 325 sunny days each year, making it perfectly placed for the solar power revolution, officials say.
Once an expanse of desert, authorities have capitalised on the sparsely populated area, claiming minimal displacement of local communities. Today robots clean dust and sand off an estimated 10 million solar panels, while a few hundred humans monitor.
This pursuit of a greener future is fuelled by necessity.
India, home to 1.3 billion people and poised to overtake China as the most populous country, has a growing and voracious appetite for energy—but it is also on the frontline of climate change.
In the next two decades, it has to add a power system the size of Europe’s to meet demand for its swelling population, according to the International Energy Agency (IEA), but it also has to tackle toxic air quality in its big cities.
“India is one of the most vulnerable countries in the world for climate change and that is why it has this big push on renewables to decarbonise the power sector, but also reduce air pollution,” Arunabha Ghosh, climate policy expert from the Council on Energy, Environment and Water, told AFP.
But experts say the country—the world’s third-biggest carbon emitter—is some way from reaching its green targets, with coal set to remain a key part of the energy mix in the coming years.
Although India’s green energy has increased five-fold in just over a decade to 100GW this year, the sector now needs to grow by the same proportion again to meet its 2030 goals.
“I believe this is more of an aspirational target… to show to the world that we are moving in the right direction,” Vinay Rustagi from renewable energy consultancy Bridge to India, told AFP.
“But it would be a big stretch and seems highly unrealistic, in view of various demand and supply challenges,” Rustagi said.
Proponents point to Bhadla Solar Park, one of the largest in the world, as an example of how innovation, technology, and public and private finance can drive swift change.
“We’ve huge chunks of land where there’s not a blade of grass. Now you don’t see the ground anymore. You just see solar panels. It’s such a huge transformation,” Subodh Agarwal, Rajasthan’s additional chief secretary for energy, told AFP.
Authorities are incentivising renewables firms to set up in the region, known as the “desert state”. Agarwal says demand has “accelerated” since 2019.
“It will be a different Rajasthan. It will be the solar state,” he said of the next decade.
If this surge is sustained then coal-fired power for electricity generation could peak by 2024, according to Institute for Energy Economics and Financial Analysis (IEEFA) projections.
Currently, solar power accounts for four percent of electricity generation. Before Modi’s announcement the IEA estimated solar and coal will converge at around 30 percent each by 2040 based on current policies.
India’s billionaires, including Asia’s two richest men Mukesh Ambani and Gautam Adani, are pledging huge investments, while Modi is setting up a renewables park the size of Singapore in his home state of Gujarat.
Show me the money
But reshaping an entire power network takes time and money, analysts warn.
“India expects developed countries to provide climate finance of $1 trillion at the earliest. Today it is necessary that as we track the progress made in climate mitigation, we should also track climate finance,” he told more than 120 leaders at the critical talks.
Farmer and doctor Amit Singh’s three-acre family farmland in Rajasthan’s Bhaloji village was running out of water and hit by frequent power outages.
“I always saw the sun and its rays and wondered… why not harness it to generate electricity?,” he said.
Singh first installed rooftop panels at his small hospital which generated half of its energy needs.
He then invested family savings into a government-linked project on his land.
The mini-solar farm cost 35 million rupees ($450,000) and Singh sells electricity to the grid for 400,000 rupees a month.
“It’s the ultimate source of energy, which is otherwise going to waste… I feel I’m contributing to the developmental needs of my village,” he added.
Ghosh said it was vital to bring down costs.
“When a farmer is able to generate power from their solar plant near their farm and pump out water—we are then able to bring the energy transition closer to the people,” he added.
Pratibha Pai, the founder-director of Chirag Rural Development Foundation which has brought solar to more than 100,000 villagers, believes in clean energy’s transformative role.
She said: “We start with solar power… we end with safe drinking water, power for dark village roads, power for little rural schools which will hopefully script the story of a ‘big’ India.”
The UAE seeks to reach net-zero emissions by 2050 with a $163B plan. It is one of the countries in the Middle East and North Africa (MENA) region since its founding that wants to effectively attract investments through diversification of its economy. The country is one of the biggest oil exporters in the world. It announced an ambitious plan to achieve zero carbon emissions that would see the Gulf nation spending $163 billion on renewable energy. The plan to be completed by 2050, puts this country at the top of the MENA region in terms of concrete climate commitment.
The above image is for illustration and is of Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed al-Nahyan as seen during the World Future Energy Summit in Abu Dhabi, United Arab Emirates January 13, 2020. WAM/Handout via REUTERS
UAE seeks to reach net-zero emissions by 2050 with $163B plan
The United Arab Emirates on Thursday announced a plan for net-zero emissions by 2050, and would oversee 600 billion dirhams ($163 billion) in investment in renewable energy.
This makes it the first country in the Middle East and North Africa region to launch a concrete initiative to achieve that climate commitment.
The Gulf state has launched several measures over the past year – coinciding with 50 years since the country’s founding – to attract investment and foreigners to help the economy recover from the effects of the COVID-19 pandemic.
The economic initiatives also come amid a growing economic rivalry with Gulf neighbour Saudi Arabia to be the region’s trade and business hub. read moreReport ad
“We are committed to seize the opportunity to cement our leadership on climate change within our region and take this key economic opportunity to drive development, growth and new jobs as we pivot our economy and nation to net zero,” said Sheikh Mohammed bin Rashid Al Maktoum, vice president and prime minister of the United Arab Emirates and Ruler of Dubai.
The UAE, an OPEC member, has in the past 15 years invested $40 billion in clean energy, the government said. Its first nuclear power plant, Barakah, has been connected to the national grid and the UAE aims to produce 14 GW of clean energy by 2030, up from about 100 MW in 2015, it said. read more
No further details on the 600 billion dirhams of investment were given.
The UAE will use the path to net zero as a way to create economic value, increase industrial competitiveness and enhance investment, said Sultan Al Jaber, minister of industry and advanced technology and special envoy for climate change.Report ad
The UAE is bidding to host the COP28 global climate talks in 2023.
Innovators in Indonesia advancing renewable energy as per the Indonesian government strategy that is pushing to almost triple, shortly, the share of renewables in the country’s energy mix. Let us see how.
The Indonesian government promises to almost triple the share of renewables in its energy mix in the next three years. That would reverse an investment climate in which fossil fuels saw 3 times more capital than renewable energy between 2016 and 2019. It would also require the nation’s monopoly power provider, Perusahaan Listrik Negara (PLN), to approve new projects at a rate that entrepreneurs don’t expect now. Moreover, all the distribution to customers is strictly handled by the state-owned company.
Accordingly, entrepreneurs work with global networks to improve the state’s literacy and risk appetite. One network is the Clean Energy Investment Accelerator. The CEIA works as a joint endeavor coordinated by Allotrope Partners, World Resources Institute (WRI), and the United States National Renewable Energy Laboratory (NREL) to accelerate renewable energy solutions for large electricity consumers in key emerging markets. CEIA brings together corporate buyers in Indonesia and magnifies their joint ideas to develop an enabling regulatory environment for accelerating renewable energy investment and use.
“How renewable energy fluctuates were claimed to be the greatest risk by potential investors to Indonesia,” says Rio Pramudita, a business development analyst for developer Akuo Energy. Because of the intermittent nature of renewable energy, the state-owned company must be ready to supply the client if renewable energy is unavailable. “Renewable energy faced some hurdles because they have to ‘pay’ for the uncertainty that PLN has to bear,” says Pramudita. In that context, a range of partners use a range of tools to promote the country’s renewable ecosystem.
Can renewable energy thrive in Indonesia’s current energy landscape?
Since its inception in 2018, CEIA has formed a taskforce in Indonesia that comprised of more than 25 corporate buyers. These corporate buyers are global firms with operations in Indonesia. They are among the companies who wish to source their energy from renewable sources but have discovered there is limited supply.There are reasons to discern a clean-energy economy growth curve in the country.
Independent Power Producers (IPP) that generate renewable energy remain limited in Indonesia. Currently, they supply 26 percent of national energy, and most lack transmission and distribution connections to sell energy directly to end users. Building distribution lines, of course, is expensive: The other option is to lease existing ones through PLN. “Transmission and distribution lines are a strategic asset of the state,” says Gina Lisdiani, director of Allotrope Partners Indonesia, part of the Clean Energy Investment Accelerator Indonesia.
“Because Indonesia is an archipelago, this transmission and distribution network becomes even more critical,” adds Lisdiani.
Although this means that IPPs generally cannot sell directly to end consumers, or be off the grid, some companies in Indonesia use their own solar panels to operate their factories and manufacturing facilities. For example, PT. Coca Cola Amatil Indonesia has this kind of solar panel arrangement with a capacity of 7.13 MW. However, an arrangement such as this is not completely off the grid. If something goes wrong and the supply falls below what the factory requires to run, PLN would supply electricity to the factory.
If industry has more supply than it needs (such as during the Eid Mubarak vacation period), they can sell it to PLN, a practice known as net metering. PLN smiles on this innovation, perhaps because it improves electrical supply without requiring new investment. “Net metering exists in Indonesia. In some cases, the PLN can reduce the price by roughly 35 percent. The process for obtaining a permit, or simply determining whether it is possible, is not uniform and depends on the location and permit by PLN regional office in the area,” adds Lisdiani.
Private-sector renewable energy purchasing
For generating and distributing renewable energy without running into the corruption that comes with permits, CEIA has worked with PLN to create and disseminate a Renewable Energy Certificate (REC). “It is hoped that it could serve as a catalyst for PLN to build and/or permit more renewable energy projects,” says Lisdiani.
Renewable energy certificates provide a simple way for businesses, institutions and individuals to offset their carbon footprint and support renewable energy. As more companies proclaim commitment to climate action and renewable energy, purchasing RECs allows businesses to source their energy from renewable sources. When demand rises, the possibility to create renewable energy power plants rises with it.
“They [corporate buyers] are also concerned about whether a renewable energy power plant has reached its break-even point. They would rather fund and incentivize generation that is not yet profitable [so they can realize higher returns in the future]. This is critical in order to assist project developers who wish to launch a renewable energy project in Indonesia,” Lisdiani says.
These enabling conditions and potential incentives are essential for project developers from the start of the project. “A new project developer without a portfolio will face enormous challenges. One of them is obtaining financing from a bank,” Lisdiani explains. “And REC has the opportunity to play a significant role in resolving some of the issues.”
The first solar off-grid system in Indonesia to serve communities
Despite hurdles, there are reasons to discern a clean-energy economy growth curve in the country. Akuo Energy, a renewable energy developer, has developed the first solar off-grid electrification systems that powers three villages in Berau, Kalimantan.
Because Akuo Energy is off-grid, it both generates and distributes energy directly to customers without running through the state pricing system. This project was mostly funded by the Millennium Account Challenge Indonesia and United States Agency for International Development (USAID). The solar off-grid is managed by a joint venture between Akuo Energy and the village-owned company (Badan Usaha milik Desa; Bumdes), with the latter owning the majority.One common misconception is that since Indonesia is a tropical country situated on the Equator, we would have been able to deploy solar energy everywhere.
The joint venture was able to obtain the required permit by presenting their project in front of the ministry, emphasizing the importance of electricity access in these three villages and how their distance from the transmission line is so far that the state-owned company cannot benefit from it. There is also a regulation that restricts the price they may charge customers; the ceiling is the price set by the state-owned company. If the joint venture wishes to raise the price above what the state-owned company has set, they must present the case to the Regional House Representative with rigorous justification.
“One common misconception is that since Indonesia is a tropical country situated on the Equator, we would have been able to deploy solar energy everywhere,” says Pramudita, who trained as a mechanical engineer. “There is a lot of heat in Indonesia, but what we need for solar panels are photons. As a result, different renewable energy technologies would be appropriate in different parts of Indonesia.”
Some parts of Indonesia are cloudy most of the year, while others are not. East Nusa Tenggara is one of the few places in the world where it is never cloudy. “Other locations such as some parts of Sumatera, the south coast of Papua, and West Java are not suitable for solar panels but are suitable for wind turbines,” explains Pramudita. Indeed, a study shows that Sukabumi and Garut, in West Java, are among the potential sites for wind turbines.
In a challenging environment, organizations and businesses such as these show a way forward. CEIA brings together renewable energy buyers and consolidates a unified voice to the government, whereas Akuo Energy is able to operate off-grid solar panels. This demonstrates a few of the opportunities for patient renewable energy investment in Indonesia.
Emerging Economies Must Leapfrog to Renewables – and They Already Are per Roya Sabri in this TRIPLEPUNDIT’s article.
Emerging Economies Must Leapfrog to Renewables – and They Already Are
20 July 2021
Renewables like solar and wind are quickly becoming more affordable and accessible. The International Renewable Energy Agency (IRENA) reports that the cost of electricity coming from utility-scale solar power fell 82 percent between 2010 and 2019, and clean power technologies such as solar and wind are undercutting even the cheapest coal-fired power plants. Further, a 2020 analysis from BloombergNEF found that wind and solar have overtaken fossil fuels as the most cost-effective form of new sources of electricity in most of the world.
This trend has made “energy leapfrogging” – i.e., the ability to reap a nation’s power needs from renewables such as solar, wind and geothermal at a rapid pace, bypassing heavy investments in fossil fuels and the infrastructure needed for them – ever more possible in emerging markets.
Economies, including several examples in Africa and Latin America, have been transitioning straight from what for many of their communities had been traditional sources of energy like wood, charcoal, agricultural waste and animal dung; these countries are also able to shift rapidly toward renewables as they have not invested in massive infrastructure that supports a national power grid, as was the case with what more industrialized nations in Europe and North America had done during the 20th century.
The result is that more communities within these emerging markets are forgoing conventional energy sources like fossil fuels; the same goes for other forms of energy like nuclear, biofuels and even natural gas.
A recent report from the think tank Carbon Tracker and India’s Council on Energy, Environment and Water (CEEW) highlights progress emerging nations are making in embracing renewables. The report also comes with a warning: If more nations do not leapfrog to these cleaner sources of energy, a worldwide low-carbon economy will not occur.
As the demand for energy grows, leapfrogging to renewables becomes necessary
The International Energy Agency estimates a surge in power generation in emerging nations will boom over the next decade, accounting for the majority of electricity demand by 2030. Thus, a world aiming to reduce greenhouse gas emissions has an incentive to ensure countries like India and China continue their developing infrastructure that is more conducive for renewables.
The authors of this Carbon Tracker and CEEW study find that emerging markets are already stepping away from fossil fuels. “Given the continued rapid growth rate of solar and wind, it is highly likely that emerging markets ex-China have already plateaued or reached peak demand for fossil fuels for electricity. China is likely to peak before 2025,” they write. China may still be a major coal consumer, but its solar sector is growing fast. Countries like Morocco, Nicaragua and Kenya have already made great leaps toward increased reliance on renewables.
Some nations are already leapfrogging to renewables
The Climate Reality Project details how Morocco, Nicaragua and Kenya have been able to turn their power generation sectors into ones that are more sustainable and resilient. Morocco, for one, has set a target of 42 percent renewable energy production by 2021 and 52 percent by 2030. It has stayed on track by building up its solar and wind power infrastructure. The North Africa country, in fact, now hosts one of the largest solar farms in the world.
After experiencing rolling blackouts due to energy insecurity a decade ago, Nicaragua is now on its way to sourcing 80 percent of its electricity from sources of renewables. By late 2020, Nicaragua’s burgeoning geothermal industry had brought the nation to 72 percent reliance on renewable energy sources.
Energy accessibility has been expanding in Kenya as decentralized solar has spread across the nation. The country is also making use of its geothermal power, which may reach 50 percent of its energy mix by 2040.
Clean energy can support a more resilient and healthy economy
These cases show that a dramatic shift to renewable energy can increase energy accessibility and stability. The economic case is significant. IRENA reported in 2016 that a doubling of renewables by 2030 could mean global GDP increases by over one percent, boosts social welfare investments by almost four percent and can add more than 24 million jobs.
While some nations have proved leapfrogging possible and beneficial, the authors of the Carbon Tracker and CEEW study note that there are serious barriers to building renewable energy reliance. Such hurdles include the intermittency of renewable sources, system costs, policies and deeply vested interests — but international actors can make a difference. The report recommends that international policymakers should focus their attention on countries currently dependent on fossil fuel imports that also have governments more amenable to policy solutions.
Finally, the authors contend that such nations are more receptive to a transition than countries that are more politically fragile. They are also in a stronger position than countries with economies largely driven by coal and gas exports. The result is that these countries that have found success with energy leapfrogging can become examples for their neighbors and help to bring more emerging nations closer toward a clean energy future.
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