Breaking News Carbon and Finance News — 08 November 2016

As the 22nd UN conference on climate change in Marrakesh approaches, an era-defining agreement on emissions reduction has entered into force. But there is still work to be done to make good on the pledges made, with a massive surge in renewable energy deployment set to play the central role. How are countries working to accelerate the deployment of renewable energy technologies around the world, and what issues are likely to form key talking points at COP22?

The Paris Agreement, as adopted by the 21st Conference of the Parties (COP21) of the United Nations Framework Convention on Climate Change (UNFCCC), will likely find its place in history as a key milestone in the global campaign to mitigate the impacts of man-made climate change. The agreement, signed by 191 member states, marks a new era of multilateral co-ordination in the face of a universal challenge, with individual countries and blocs setting out their ‘nationally-determined contributions’ (NDCs) to the process.

The Paris deal is the product of years of intensive negotiations between UNFCCC member states, as delegates from countries of assorted wealth and circumstances hashed out their differences and searched for consensus on key issues such as the balance of obligations and international financing channels.

Source: Powertechnology

Setting the stage for COP22

Despite the long and arduous prelude to the adoption of the Paris Agreement in December 2015, the road to ratifying the treaty has, happily, been much shorter. In early October, the United Nations announced that the agreement officially entered into force on 4 November, with its requirement that 55 countries representing 55% of global carbon emissions ratify the deal, now met after the European Union, Canada, Germany, France and others submitted their instruments of ratification to the UN.

Considering the difficulty involved in setting the parameters of the international response to climate change, the fact that the Paris Agreement has come into force less than a year after its adoption is a remarkable feat.

“What once seemed unthinkable is now unstoppable,” said UN Secretary-General Ban Ki-moon after the final required ratification instruments were submitted. “Strong international support for the Paris Agreement entering into force is a testament to the urgency for action, and reflects the consensus of governments that robust global cooperation, grounded in national action, is essential to meet the climate challenge.”

“The fact that the Paris Agreement has come into force less than a year after its adoption is a remarkable feat.”

The Paris Agreement’s entry into force in early November brings a tremendous momentum leading into COP22, the next international climate change conference, which is taking place in Marrakesh, Morocco from 7-18 November. Nevertheless, there are still countless details to be discussed at the conference as countries continue to drill down on their commitments.

Climate change mitigation covers a wide range of activities, from energy efficiency to adaptation measures, but the promotion and integration of renewable energy sources might stand as the most important pillar of the campaign to reduce emissions and limit global warming to less than 2°C above pre-industrial levels. So how are countries working to accelerate the deployment of renewable energy technologies around the world, and what issues are likely to form key talking points in Marrakesh?

Pushing renewables forward with public policy

Public policy provides an all-important framework for the integration of renewables, and there are many mechanisms by which governments can help spur their development. From an international perspective, the entry into force of the Paris Agreement is an important signal of the global community’s intentions, and will introduce greater accountability and add urgency for governments – whether they have ratified the agreement or have yet to do so – to narrow down their roadmaps for renewables integration based on their now-binding targets, from the US’s commitment to source 20% of its energy mix from renewables by 2030 to the EU-wide target of a 27% clean energy share by  the same year.

Elsewhere in the international sphere, the recent establishment of a new UN sustainable development agenda and the adoption of 17 Sustainable Development Goals are playing a similar framing role, with goals specifically targeting both clean, affordable energy and action on climate change.

In the sticks of national and regional policy, there are many signs of progress as well as clear indications of work that still needs to be done. In the US, for example, offshore wind power is just starting getting afloat, and the UK government’s recent greenlighting of shale gas fracking – overruling a previous local government rejection in the process – has provoked anger and anxiety that, as the realities of Brexit continue to become clearer, the country might walk back on climate commitments made through the EU.

Prime Minister Theresa May recently assured the UN that her government would ratify the Paris Agreement before the end of 2015, providing some reassurance, but without a strong policy framework supporting renewable deployment – including the timely construction of Hinkley Point C nuclear plant and potentially a reversal of the current ban on new onshore wind farms – sluggish action will betray strong words.

Still, around the world, there seems to be as many leaps forward as sideways steps when it comes to policy. US states have continued to expand existing Renewable Portfolio Standards (RPS) to increase the share of renewables, including increased commitments from California and New York, and the country’s first 100% RPS in Hawaii.

In terms of renewable energy support mechanisms, many countries are beginning to shift away from the feed-in tariffs that are credited for so much of renewable energy’s growth in the last two decades, and towards market-based tendering mechanisms, allowing the auctioning of a specific amount of renewable capacity per year.

In Europe this is part of the EU’s general objective to implement as much market-based support for renewables as possible, and in Germany, which is reforming its Renewable Energy Act to jettison feed-in tariffs in favour of auctions from the start of 2017, the Federal Ministry for Economic Affairs and Energy is expecting the auctions to provide more control of renewables development in relation to grid expansion, as well as reduced costs and more planning security. Still, concerns raised over the impact of losing feed-in tariffs could make tendering a major talking point at COP22, even as the mechanism gains steam in countries as diverse as South Africa, the UAE and India.

Driving investment

Underneath the layer of public policy and international negotiations lies the cut and thrust of developing individual renewable energy projects, and in this case it is financing and investment that drives growth and innovation.

As US Vice President Joe Biden remarked at COP21, one of the primary roles of the high-profile messages and targets sent out by the international community is to spur market confidence.

“Many of us here know that it won’t be governments that actually make the decision or find the product, the new technology, the saving grace of this challenge,” Biden said. “It will be business unleashed because of 186 nations saying to global business in one loud voice: we need to move in this direction. And that will move investment.”

One of the most important issues to discuss in the run-up to COP22 and during the conference is how developed countries are going to ramp up to the planned $100bn of annual financing by 2020 for climate change mitigation and adaptation, whether through direct financial support, technology transfer or other means. A workshop has already been scheduled for COP22 to discuss a consistent definition for climate finance. The conference may also see some discussion of how the Adaptation Fund, set up in 2001, could be expanded or re-purposed to serve the goals of the Paris Agreement. Multilateral banks such as the European Bank for Reconstruction and Development and the BRICS New Development Bank are also driving a great deal of green technology and project investment.

France has led by example in its support of renewable energy projects in Africa, with President François Hollande announcing that the country had spent 50% more than its COP21 pledge on renewable energy, with €631m of investment directed to the African Renewable Energy Initiative, supporting 738MW of clean energy projects across Africa, and 21 more projects in the pipeline.

“China spent $103bn on building renewable energy capacity and developing technology in 2015.”

China, meanwhile, has emerged as a clear leader in public renewable energy investment across the board. According to the United Nations Environment Programme’s (UNEP) latest renewable energy trends report, the country spent $103bn on building renewable energy capacity and developing technology in 2015, a massive 36% of the global total and more than the investments made by the US, UK and Japan combined.

The UNEP report also found that emerging economies have begun to outpace their developed counterparts in renewable investment, with emerging countries increasing total investment year-on-year by 19% to $156bn last year, while renewable investment in the developed world dropped by 8% to $130bn, with investment potentially hampered by subsidy cuts and stagnant economic conditions.

COP22 will also likely see the ratification of the International Solar Alliance (ISA), which was originally proposed at the Paris summit. The alliance, which brings together 80 solar-rich countries to collaborate on solar technology and financing, could become a valuable example for multilateral support focussing on a particular technology, and it has support from major financial and technical powerhouses such as India, the US and France.

Progress and international optimism has indeed been heartening since COP21, but COP22 isn’t likely to be as defining as its predecessor in Paris, and there is clearly still an enormous amount of work to be done. The hope is that the momentum of the Paris Agreement will carry through to COP22 and beyond, and that renewable energy will get the support it needs to stand as a vital keystone in the world’s collective campaign to save itself.

 

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