Renewables on the Rise
Sector boosted by US/China pledge to cut carbon emissions
The prospects for global renewable energy growth appear to have been given a boost by a new pledge by the world’s two largest polluters – China and the United States – to cut carbon emissions.
US president Barack Obama and his Chinese counterpart, Xi Jinping met at the Asia-Pacific Economic Cooperation gathering in Beijing last month and surprised everyone by laying out plans to tackle climate change for the first time.
More than a year ahead of the deadline to secure a treaty at the UN summit in Paris in December 2015, the US has pledged to cut carbon output by 26-28% by 2025 compared to 2005 levels, while China plans to produce 20% of its energy from zero carbonsources by ‘around’ 2030 when it says its carbon emissions will peak.
These loose commitments represent a far smaller cut than that agreed in October by the EU, which plans to cut carbon emissions by 40% by 2030 compared to 1990 levels. However the move is seen as significant as China and the US emit almost as much carbon as the rest of the world combined.
The 1997 Kyoto Protocol, the world’s first climate change treaty, was a failure largely because China and the US did not sign up the deal.Until now China has steadfastly refused to be drawn into taking any action that would jeopardise its economic growth while the US has said it would not commit unless China was prepared to do the same. That impasse now appears to have been broken.
The news waspredictably met with mixed reactions from experts and observers. While many commentators said the deal does not go far enough, they also hailed it as a historic milestone in the battle against climate change, given that both countries had previously been unwilling tocommit to serious cuts.
Some experts have downplayed the significance of the deal, branding it more a political move than anything else. Others have cast doubt on the ability of Obama to pass the deal through a House of Congress controlled by the opposition Republican Partywhich is dominated by climate sceptics.
Senate Republican Leader Mitch McConnell declared the deal further proof of Obama’s war against the country’s domestic coal industry and has vowed to oppose new environmental regulations.
RajendraPachauri, the head of the UN panel of climate scientists, welcomed the deal though he said it fell short of cuts needed to avert the worst effects of global warming. Others pointed out that the targets, which are not binding, don’t go beyond what the two countries had already set.
The agreement came hot on the heels of the latest report by the Intergovernmental Panel on Climate Change (IPCC), which called for the decarbonisation of the world’s energy mix by 2100. Following that announcement, the Abu Dhabi-based International Renewable Energy Agency (IRENA) was quick to step in and say that renewable energy could fill the gap.
“Any solution to address climate change requires a massive scale-up in renewable energy,” said IRENA Director-General Adnan Z. Amin. “And as momentum builds around the climate issue, so does the focus on renewable energy – because not only can renewable energy combined with energy efficiency keep the global climate to a two degree temperature rise, it can do so affordably.”
The deal sets the stage for energy companies to invest billions of dollars in R&D in clean and renewable technologies in the coming years. Beijing’s pledge will require an extra 800-1,000 gigawatts (GW) of zero emissions power generation capacity including nuclear, wind and solar over the next 15 years.
That is more than all the coal-fired power capacity in China today and close to the total current generation capacity in the US. It also equates to adding around 1,200MW, or the equivalent of building a large coal-fired power plant, every week.
Investment bank HSBC said in a report that the deal would put pressure on other major economies in both the developed and developing worlds to follow suit.
The news should be welcome to a renewable energy sector already brimming with confidence.
Hardly a day goes by without someone proclaiming renewable energy as the next big thing thanks to the rapid advances in solar and wind technology and its increasing competitiveness with other forms of power generation.
The Middle East still lags far behind the world’s other major energy markets in terms of renewable development but there have been plenty of signs throughout 2014 that a breakthrough is imminent. The question is, will 2015 be the year that it finally happens?
The deal in numbers:
- The US will cut carbon emissions by 26-28% by 2025 compared to 2005 levels
- This will double the pace of carbon reduction to 2.3-2.8% per year on average between 2020 and 2025
- China will produce 20% of its power needs from zero carbon sources by 2030.
- China’s carbon emissions will peak in 2030
- The commitment will require China to deploy 800-1,000 gigawatts of new zero carbon emission generation capacity by 2030
- This equates to more than all the coal-fired power plants in China todayand close to the total current power generation capacity of the US