REN21 Global Status Report Shows More Renewables for the Money

 

(3BL Media/Justmeans) - REN21, the Paris-based, multi-stakeholder, global renewable energy policy network, just released their Renewables 2017 Global Status Report (GSR), the world’s most comprehensive annual overview of the state of renewable energy. Over 800 individuals contributed to the report. Highlights include the fact that a record-setting 161 GW of new capacity was added, a 9% increase from last year. Although that’s an impressive achievement, it actually represents a 23% decrease in financial investment from the year before. Christine Lins, Executive Secretary for REN21, told Justmeans that “the key message for 2016 was that investors could get more for their money.” While it’s good news that costs have come down enough to enable this, if we are to meet the targets set in Paris, especially in light of President Trump’s withdrawal of support for the agreement, we need to see investments increasing rather than decreasing.

Still, the decreasing costs will be the prime driver for continued investment. Recent deals in Denmark, Egypt, India, Mexico, Peru and the United Arab Emirates saw renewable electricity being delivered at USD 0.05 per kilowatt-hour or less, well below equivalent costs for fossil fuel and nuclear generation in each of these countries.

When asked about the Trump withdrawal, Lins said, “What we’ve seen so far is that President Trump’s announcement has created a lot of united voices around the globe, of countries announcing that they are going to stick to the Paris agreement. Right now, renewables are cost-competitive in many situations with fossil fuels. With him as a businessman, it’s quite surprising to see him taking that step.”

As others have pointed out, it will take three and a half years to fully withdraw from the agreement, and by that time, we could be looking at another administration. Lins also pointed out that within the US, numerous state and companies were reaffirming their commitments to the goals agreed upon in the Paris accord. It was concerns over what Trump might do that hastened the ratification of the accord last year.

The US is the world’s second largest emitter of greenhouse gases, behind China, and the largest historical emitter. According to the REN21 report, the US is also second, behind China in renewable capacity added, overall and in solar and wind as well. The US ranked #1 in fuel ethanol and biodiesel capacity added.

In other highlights described in the report, offshore wind providers in Germany won two recent auctions without the need for government subsidies. While subsidies are often cited a “prop” for renewables, the fact is that around the world, subsidies for fossil fuels and nuclear power continue to dramatically exceed those for renewable technologies. As recently as 2014, fossil fuel subsidies exceeded those for renewables by a factor of four to one. As of the end of last year, more than 50 countries have committed to phasing out fossil fuel subsidies, but it’s not happening fast enough. By continuing to prop up the fossil fuel industry, governments are meddling in the free market and slowing the rate of decarbonization.

To put this in perspective, the good news was that for the past three years, emissions from the power sector has remained roughly constant while the global economy has grown three per cent, demonstrating that economic growth and emissions can be decoupled. However, if we are going to significantly reduce the rate of global warming, we need to reduce emissions, in real terms. That will require significantly more emission cuts.

We asked Lins what else is driving uptake besides cost? “First there is the recognition that the energy system needs to be decarbonized. Next the world has agreed to provide energy access to all. We still have the situation that 1.2 billion people around the world do not have access to electricity. We also see the distributed energy companies have been very successful in raising money. Investment in pay-as-you-go solar companies has increased from $3 million in 2012 to $223 million in 2016. We have the solutions now, we just need to implement them.”

What about the barriers? “The biggest barriers, beside the fossil fuel subsidies, are the absence of political will in some places and the social issues associated with the fact that a transition of this magnitude will have winners and losers. We need to find ways to ensure that those on the losing end are taken care of.”

Just last week Justmeans described just such an effort by the Chinese wind power company Goldwind, which made the commitment to hire coal miners to fill job openings for wind turbine technicians. This seems like a far better way to ensure that coal mining families are taken care of while establishing, or maintaining global leadership at the same time.