Last month the International Renewable Energy Agency (IRENA) has recently released a report that seeks to lay out a path for the global renewable energy sector in a post-coronavirus world. Officially titled “The Post-COVID Recovery: An Agenda for Resilience, Development and Equality”, this report is notable for the contention it seeks to advance, alongside the broader debate its perspective will drive within the renewable energy sector, and the global economy as a whole.
So what is IRENA’s vision for the renewable energy industry in a post-coronavirus world? And how does it compare to the perspectives other organizations hold when assessing the future? Let’s look now.
An overview of IRENA
For anyone yet to be familiar with IRENA a brief recap at the outset is worthwhile. The organization advocates and supports the transition of nations to sustainable energy, with over 160 members, and over 180 countries in total engaged with it. Headquartered in Abu Dhabi, UAE, and led by Director-General Francesco La Camera, this latest report is one of many produced by IRENA. Alongside publications that survey the global landscape as a whole, the organization regularly completes assessments of individual nations such as Lebanon and the Republic of Azerbaijan, and regions like Southeastern Europe, in appraising these locales respective progress towards a sustainable energy operation within their territory.
The change in climate due to Corona
It’s a reality of any report that seeks to engage in futurology that achieving precision in predictions can be incredibly difficult. This is particularly so in 2020, a year in which most nations find the future looks more clouded and uncertain than in any time within living memory. As indeed, by so many measures the coronavirus pandemic is more severe than the Global Financial Crisis (GFC)—that represented the last major chapter of economic upheaval the global economy saw prior to this pandemic—and that comparisons are increasingly being made between this era and the Great Depression evidence just how rocky the road to recovery will be.
In seeking to provide a pathway that offers hope and is actually achievable, IRENA’s report places an emphasis upon the practical possibilities, and the capacity for renewable energy to not offer “pie in the sky” idealistic benefits, but instead tangible outcomes for embattled economies and beleaguered societies.
A key element of this is the prospect of renewable energy installations offering nations a greater resiliency than they currently have. This owing to the additional energy output such installations can offer, and their capacity to diminish the reliability of fossil fuels—especially those imported from overseas—that have seen new volatility injected into their operations and uncertainty around their future following the pandemic’s outbreak.
As Mr. La Camera, Director-General of IRENA summates “Renewables have outpaced fossil fuels in new power capacity additions overall since 2012. They are emerging as the default choice for new projects everywhere”, and in turn that:
Next year, up to 1,200 gigawatts of existing coal-fired capacity could cost more to operate than it does to install new utility-scale solar PV. The continued cost decline means that renewables are not only central to address climate change, but they are also already becoming the most economically viable and competitive way to spur economic growth.
So although the report does not shy away from reference to the United Nations Sustainable Development Goals and the Paris Agreement on Climate Change, it also provides options for nations seeking to harness the power of renewable energy to generate clear-cut and concrete economic outcomes for their citizens.
As Mr. La Camera noted, “our report shows that investments and policy measures focused on the energy transition can strengthen the economic recovery from COVID-19, bolster sustainable development and set the course for a fully decarbonized energy system by the middle of this century.”
The start of the new beginning: 2021 to 2023
The years of 2021–2023 are held to be especially important for the post-corona recovery. Unquestionably bringing the coronavirus pandemic under control and navigating a shift to a “new normal” while maintaining community health and safety has been a central focus of essentially every government throughout the first half of 2020. With the outbreak now coming under control in many nations—notwithstanding the risk of a “second wave” that is ever-present—governments are now shifting focus to the huge work of economic recovery.
This certainly will not happen overnight, and in fact, it’s recognized many governments will require until at least the end of the year to revise budgets, cement guidelines and regulations that will form the basis of living and working in the post-coronavirus world. Put simply, a collective ambition to begin real ‘“rebuilding” in 2020 is a timeline too many nations around the world are simply unable to meet. Not the least of which because there remain many variables including the re-opening of borders, the resumption of major industries like tourism, and of course the ongoing hope of a successful vaccine and/or cure to the coronavirus being announced soon.
These factors doubtless inform IRENA’s focus on 2021–2023 as a timeframe for a new beginning in the growth of renewable energy. At the same time, the report also notes that renewable energy cannot be an afterthought—something put in the “too hard basket” and set aside until a more regular way of life resumes. Instead, as well as the aforementioned resiliency IRENA details greater investment in renewable energy can offer, it holds for every million dollars put into renewables or energy flexibility, it could result in the creation of 25 jobs. What’s more, an accelerated energy transition could deliver an additional 5.5 million jobs in the sector overall by 2023.
Alternative views on alternative energy
There is considerable consensus within the international renewable energy industry surrounding the potential for the sector to not be setback by the pandemic, but instead to emerge stronger. Just the same, there are also varying views surrounding the best way to achieve this aim, and what goals must be prioritized.
Robert Hornung, President & CEO of the Canadian Renewable Energy Association told Solar Magazine, “While renewable energy can deliver jobs and investment to contribute to economic recovery in the short-term, it will play an even bigger role in helping economies make the necessary transition to net-zero greenhouse gas emissions by 2050 in response to climate change.”
Furthermore, Mr. Hornung underscores that new investment must be accompanied by policy reform in order to maximize the output renewable energy installations can offer a community.
Economic stimulus investment should also be accompanied by electricity market and regulatory changes that enable wind energy and solar energy to compete on a level playing field for new electricity generation opportunities while also facilitating greater customer choice in electricity supply options.
Such substantial economic reforms are likely to stretch well beyond the time period of 2021–2023 in most, if not all nations that are yet to decisively effect them. Yes, 2020’s events have generated a new readiness among economic stakeholders to work in collaboration with governments in pursuing substantial economic reform to better respond to the pandemic. But there is the reality that many industries are knocking upon government doors seeking to influence national priorities, and obtain emergency financial assistance.
In this dynamic, while renewable energy leaders will surely have a seat at the table, it will ultimately be one of many, and undoubtedly other voices shall be louder and more urgent. Accordingly, while much focus is fairly on the future, as Grenville Gaskell, the Chief Executive of the New Zealand Wind Energy Association told Solar Magazine, building on existing foundations laid in years prior is just as important.
“The positive fundamentals of renewable energy do not change as a result of COVID-19. NZ is advantaged in having a high level of renewable electricity generation (around 85%) and a vast untapped wind resource”, said Mr. Gaskell.
The key determinant of future growth is by way of an increase in demand from the electrification of fossil fuel industries and transport. Recent changes to NZ’s Emissions Trading Scheme also make renewables more attractive and the Association prefers a price on carbon rather than any subsidy for renewables which are common in other markets with a low level of renewable electricity generation.
Turning the page with IRENA’s report
In this vein, although it’s not yet clear when exactly the great majority of the world’s nations will be in a position to resume a regular way of life and turn their attention towards an economic rebuild, the work of IRENA and similar organizations is laying the groundwork for that new beginning. Even if not all will agree with their contention at present, or circumstances change in the future and require a recalculation, such work is immensely valuable and warrants a read by anyone with an ongoing interest in renewables. comment