LONDON: Doubling today’s share of renewable energy would help the world meet its bold climate goals agreed in Paris – while avoiding up to 12 gigatons of CO2, creating more than 24 million jobs, saving 4 million lives a year and boosting global GDP up to US$1.3 trillion.
The findings, published today in the International Renewable Energy Agency (IRENA) report ‘REmap: Roadmap for A Renewable Energy Future’, build on a January study that highlighted how investing in low carbon energy is beneficial for the economy and the planet.
The second instalment of IRENA’s Remap series expands these economic findings based on the power sector, proving through analysis of 40 economies covering 80% of global energy use, how decarbonization of the global energy mix is cost-effective and necessary to meet the climate targets of the Paris Agreement.
To further prove that economic growth and emissions reductions need not be separated, yesterday the International Energy Agency published a separate report that demonstrated for the second year in a row, that global emissions had stalled while the economy grew.
Global investors already understand the importance of focusing on renewables to protect their long-term assets. Clean investment attracted a record US$329 billion last year – about six times the amount invested in 2004 – as a report by Bloomberg New Energy Finance shows.
However, to achieve the IRENA target of doubling renewables, additional investments of US$100 billion per year are needed, including avoided investments in the fossil fuel industry.
Recent growth in renewables could keep the world on track for this target. 2015 was a record-breaking year for renewable energy capacity installations, with 64 gigawatts (GW) of wind and 57 GW of solar photovoltaic commissioned during the year – an increase of nearly 30% over the previous year.
Solar is also projected to be the cheapest source of energy in the next 10 years, thanks to continuously falling prices, led by China. While the country is the biggest polluter to date, it is also the world’s biggest investor in clean energy with more than US$110 billion invested last year. In 2015, China also hit a new record for wind capacity, adding almost 33 GW to hit a total of 120 GW, according to state data.
To reach IRENA’s goal of doubling today’s share of renewables, energy efficiency will play a crucial role. In fact, with a growing population, energy demand will rise by 30% in 2030 compared to the level today – and to avoid a spike in global emissions, scale-up of energy efficient technology and supportive policy must be accelerated.
The new report indicates that 60% of the world’s renewable energy potential can be achieved by implementing existing government plans, while the rest should come from energy efficiency measures and investment in clean energy access.
One of the quickest and most cost-effective ways to achieve this goal is to implement light-emitting diodes (LEDs) in our homes and streets. During Climate Week NYC 2015, The Climate Group called for all city street lighting to switch to LED by 2025, showing in a report the huge carbon and cost savings that are possible with this technology. The initiative is part of the major global campaign LED = Lower Emissions Delivered, to encourage local governments, cities and utilities to embrace the carbon and cost benefits of switching to LED.
Another way to expand electricity access while reducing emissions is off-grid renewable solutions, states the IRENA report. The Climate Group has just concluded its Bijli – Clean Energy for All project, which has provided energy access to over 65,000 people in rural India thanks to off-grid solar systems.
While business plays a central role in accelerating the transition toward a low carbon economy, policy is also core to long-term growth. To date, policies now in place would raise the renewables share in the global energy mix from 18.4% in 2014 to only 21% by 2030, the IRENA report states.
In particular, policy to decarbonize the power sector – which is the largest single contributor to CO2 emissions, counting almost a third of the total – offers the biggest potential. However, transport, heating and industry must also accelerate renewables implementation if the world is to avoid the worst effects of climate change.
To spur the renewables transition, The Climate Group and CDP launched the RE100 campaign, a global initiative supporting major companies committing to 100% renewable power. “Many companies are switching to renewable power at a remarkable rate, and encouraging their suppliers and customers to do the same,” says Emily Farnworth, RE100 campaign director at The Climate Group.
“Our analysis of the private sector’s electricity consumption and carbon emissions indicated that a switch to power from renewable sources could cut global CO2 by nearly 15%. By acting together, the world’s leading companies are creating a thriving renewable energy market that will help keep a global temperature rise below 2 degrees Celsius.”
The IRENA report states that the cost of doubling the renewable energy share by 2030 would be US$290 billion per year, a number that “is at least 4 and up to 15 times less than the external costs avoided.” In fact, as the economist Lord Nicholas Stern, chair of the Grantham Research Institute on Climate Change and the Environment explained last year, the cost of inaction on climate change greatly exceeds the cost of action.
The IRENA report pins down exact numbers, stating that “the reduction of CO2 emissions and air pollution damage on human health and agricultural crops can produce annual net savings between US$ 1,200 billion and US$ 4,200 billion” while saving up to 4 million lives a year.
Doubling renewables by 2030 will also more than double jobs in the sector, from 9.2 million in 2014 to 24.4 million. To support this growth, the report calls for increased collaboration and coordination from governments – two main aspects of The Climate Group’s States & Regions Alliance, whose members are making bold climate commitments to attract innovation, create jobs and build long-term prosperity for citizens and businesses.
Concluding the report, IRENA calls for an “immediate, concerted action” from policymakers to follow its roadmap in the next 14 years. In particular, authors highlight the market distortion caused by fossil fuel subsides – defined by Ángel Gurría, Secretary-General of the Organisation for Economic Co-operation and Development as the “greatest misallocation of resources”, in a Climate TV interview.
Before Paris, The Climate Group was pivotal in showing global leaders how innovative sub-national policies and business climate action is good for the economy and the planet. However, the next five years will be crucial to implement the Paris Agreement, avoid climate disruption in the next century – and show that a cleaner, healthier and more prosperous world powered by renewable energy is not only possible, but inevitable.
by Ilario D'Amato