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Powering the Green Economy

Adnan Amin

Director General, I nternational Renewable Energy Agency

Embracing renewable energies can achieve the sustainable and inclusive economic development that the world increasingly seeks. There has been much recent discussion about the possibilities of a transition to a “Green Economy” that could foster economic growth and job creation while protecting the environment and achieving social inclusion. The Rio+20 UN Conference on Sustainable Development in June will promote renewable energies, and there are already encouraging signs that many governments around the globe are taking steps towards building strategies that could help them promote growth while shifting to a less carbon-intensive and more equitable path.

By developing renewable energies we can place the world on a path to sustainable clean energy, cut emissions of greenhouse gases and benefit the environment. In the developing world, renewable energies not only help lift isolated rural communities out of poverty, creating opportunities and jobs, but can have a fundamental role in addressing energy security and climate change. Many economists say a move to renewable energies could be the turning point that is needed to drag western economies from the brink of a long-term recession. Renewable energies are a source of diversified economic growth and job creation: more than 3.5 million people are already employed in renewable energy industries.

According to the IEA’s World Energy Outlook 2011, as many as 1.3 billion people in developing countries, 84 per cent of them in rural areas, lack access to electricity and the opportunities it provides. This is a major issue, particularly in Africa. Renewable energies’ modular nature — and their frequent ability to operate without centralised infrastructure — can make them particularly effective in reaching the poorest first. Energy is much more than access to a service to the rural poor: it means the opportunity to release their potential, improve their economic conditions and enjoy the benefits of better health services, education and communications — essential elements of sustainable development.

The International Renewable Energy Agency (IRENA) is truly committed to energy access, especially to the isolated rural poor. Last July 2011 it organised the IRENA-Africa High Level Consultations on Partnerships on Accelerating Renewable Energy. It has recently concluded Renewable Readiness Assessments (RRAs) in two pilot countries in Africa, and is now planning to expand this initiative to other countries on the continent, and in the world. RRAs are designed to provide a holistic assessment of the conditions for renewable energy deployment in a country and to identify the necessary elements for devising an effective policy framework to support their market development.

Energy security is a major area of concern for both developed and developing economies. The rising prices of fossil fuels — and expectations that their supply and demand balance will remain quite tight in the coming years — clearly concern governments around the world. Least Developed Countries with a high dependency on fossil fuels have been particularly affected as rising prices and the costs of imports hit their fiscal balances. Adopting renewable energy can reduce energy costs. The established understanding that new energy sources take many years to become cost-effective does not apply to renewable energy, where the relative simplicity of both established and innovative technologies puts them well within the within the investment scope of developing nations.

Renewable energies provide countries with the possibility of achieving a more sustainable energy mix while preserving the environment and reducing the impact of fuel price volatility, especially on the poor. Yet energy laws have historically been designed to privilege conventional fuels. Subsidies for them around the world, for example, are in the range of $300 to 500 billion per year, translating into an unprecedented level of market distortion. Deploying renewables has also been limited by insufficient technical and administrative knowledge, and limited access to information on their potential to meet global energy needs. IRENA has a fundamental role in levelling this playing field, providing knowledge and know-how and facilitating the flow of information and best practices so as to realise renewable energies’ huge potential and move us forward to a greener world. It can also help countries break down the many political, economic, institutional and market barriers that limit the widespread use of these technologies.

IRENA is developing information and indicator platforms for this. It is coordinating, for example — in partnership with the Clean Energy Ministerial Multilateral Solar and Wind Working Group — the development of the Global Solar and Wind Atlas, which will provide comprehensive energy potential data for planning the transition to renewable energy systems.

These are exciting times for renewable energies. The latest Renewable Global Status Report showed that by early 2011, they represented as much as one quarter of the world’s power capacity. Global investment in 2010 reached $211 billion, up 32 per cent from the previous year – with substantial technological and costs improvements, particularly in solar. Admittedly, a large proportion of these resources have been invested in specific areas, particularly the United States, China and Europe — but IRENA aims to capitalise on their experience and foster cooperation at global, regional and national levels, sharing knowledge, enabling policies, enhancing capacity, and encouraging investment, technological development and innovation. In the end, renewable energy is one of the best hopes we have for achieving a more sustainable and inclusive future.

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