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There are many drivers of climate change, but few would disagree that energy infrastructure built according to “business-as-usual” standards is a major one. Meeting the lofty goals set at the 2015 Paris Climate Accords requires powering our homes, businesses, and government agencies with a cleaner mix of energy that includes more renewable sources. It also requires promoting standards that encourage energy efficiency—for example, for appliances or building codes—as a low-cost and high-impact way to reduce greenhouse gas (GHG) emissions.
The Global Infrastructure Facility (GIF) is playing a positive role by preparing bankable, climate-smart projects that help countries build low-carbon energy infrastructure and encourage greater energy-efficiency measures. The GIF both drives and leverages private sector investments in climate-smart projects by promoting good governance and standardization in project preparation and has a sizeable portfolio of climate-smart projects in the pipeline.
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Solar power is experiencing a surge in popularity across the globe. It prevents carbon emissions, helps diversify the power generation mix, reduces dependence on fossil fuels, and can increase off-grid energy access.
With falling costs of solar photovoltaic (PV) technology, advancing storage technology, and grid integration, prices for solar PV electricity have been falling rapidly around the world and solar is now in many countries price competitive with traditional energy sources and has become particularly attractive for developing countries.
The Asia-Pacific region, comprised of 58 economies, is geographically expansive and a picture of diversity. The trends for sustainable energy in Asia-Pacific, which mirror the region’s economic and resource diversity, are underscored by the fact that . The region’s sustainable energy picture is captured in a new report by the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP), entitled “Asia-Pacific Progress in Sustainable Energy: A Global Tracking Framework 2017 Regional Assessment Report.” The report is based on the World Bank and International Energy Agency’s Global Tracking Framework (GTF), which tracks the progress of countries on energy access, energy efficiency, and renewable energy under Sustainable Development Goal 7 (SDG7).
Four overarching sustainable energy themes emerge from the report:
Photo: Scaling Solar project in Zambia
What is a common thread between Argentina, Maldives, and Zambia? In each of these countries, the World Bank provided guarantees to support transparent auctions for renewable energy. Through these, I have seen how the Bank’s involvement helped increase private investors’ confidence, attract world-class developers, and ultimately reduce tariffs.
Drawing on 10 years of diverse experience in the power sector in both public and private organizations, my role is to help bridge the divide between public and private parties and help each side better understand the other. The World Bank is ideally positioned for this. Both sides understand the World Bank carries out a detailed due diligence and ensures the auction meets international standards. Both sides appreciate the World Bank will be an honest broker if issues arise. Because of its long term and continuous involvement in our client countries, the World Bank can help identify and solve issues early on. As such, no World Bank project-based guarantee has ever been called.
The dramatic decrease in the cost of renewable energy technologies seen in recent years presents an unprecedented opportunity to improve our access to energy—and create employment in the process. This is especially true in Somaliland, where more than 80% of the local population of 3.5 million does not have access to modern electricity.
Somaliland’s small economy cannot afford large investments in the infrastructure needed for generating energy in the more traditional, 20th century sense. Running electricity lines over long distances to reach a geographically dispersed, off-grid population is simply uneconomical. Moreover, at US$0.85 per kilowatt, the cost of electricity in Somaliland is among the highest in the world.
To reduce carbon emissions, national and local governments are taking various approaches—and, thus, electric cars, solar home systems, and energy-efficient solutions for buildings are booming in Europe. Cities like Amsterdam are front and center of this transformation. Netherlands, for instance, has an ambitious goal of reducing CO2 emissions by 80–95 percent by 2050 compared with 1990, making it an ideal venue for a Smart Cities Tour earlier this year, where a group of 26 representatives, including national and municipal officials and World Bank project teams, to learn from the Netherlands’ successful experience in energy sector transformation.
For instance, during a site visit to energy network company Alliander, we saw the pilot of a neighborhood battery system (NBS) in Rijsenhout, a town in the Western Netherlands near Amsterdam. The NBS is a local, community-level energy storage system that employs one large battery to stabilize neighborhood power distribution grids, particularly during peak hours. With a significant and increasing number of electric vehicle charging stations and solar panels installed in communities, electric networks are under increasing pressure to handle the variation between solar power during the day and concentrated peak electricity demand in the evenings and nights. Maintaining stable power supply and enhancing the resilience of the electricity grid to spikes in demand are fast becoming real challenges for these communities. While overhauling the power grids to prepare for these challenges could be costly and time-consuming, these small-scale NBS provide a low-cost, smart alternative solution.
Morocco, the host of COP22 happening this week and next in Marrakech, is an example of a country that is working closely with the World Bank and other organizations to shift its economy onto a low carbon development path.
It just submitted its official climate plan, or nationally determined contribution, NDC, where it pledges a 42% reduction below business-as-usual emissions by 2030. This is 10 percentage points more ambitious than it previously laid out, ahead of Paris, and we see the plan affecting a growing number of sectors in the economy. Morocco plans a $13 billion expansion of wind, solar and hydroelectric power generation capacity and associated infrastructure that should see the country get 42% of its electricity from renewable sources by 2020, ramping up to 52% by 2030.
Last month, a new wind farm began spinning its blades in Jamaica. At 36 megawatts (MW) it became Jamaica’s largest private-sector renewable energy project, set to diversify the country’s energy matrix, reducing its high electricity prices and generating significant environmental and social benefits.
It does not happen often that one of the finest actors of our time tweets about a World Bank supported project and invites all his fans to have a look at the impressive pictures taken from space. In fact, I can’t remember having seen that before.
But this is what Oscar winner and climate activist Leonardo DiCaprio did a few months ago when the Noor Concentrated Solar Plant (CSP) in Morocco—the largest CSP plant in the world - was opened. Once finalized, in two years, it will provide clean energy to 1.1 million households. I visited the plant two weeks ago and it is truly an impressive site. The indirect benefits of the project might even be larger: it has advanced an important and innovative technology, it has driven down costs of CSP, and it holds important lessons for how public and private sectors can work together in the future.
I am proud that the World Bank, jointly with the African Development Bank and a number of foreign investors, supported this cutting-edge solar energy project. But it was made possible thanks to the Climate Investment Funds (CIF), which put in US$435 million to “de-risk” the investment, playing an essential role to kickstart the deal.