Sustainable Energy for All
We participated today in the session: Double share of Renewable Energy in the Global Energy Mix to achieve Sustainable Energy for all.
“Sustainable Energy for All” is the Secretary General Ban Ki Moon initiative, whose goals are: ensuring universal access to modern energy services by 2030; doubling the global rate of improvement in energy efficiency by 2030; and doubling the share of renewable energy in the global energy mix by 2030.
How to double this share is our topic today.
It is a privilege to be in the Global Compact Corporate Sustainability Forum, and to have the opportunity to share our vision on how to double the renewable energy percentage in the global energy mix.
I consider five key issues to make this possible:
First: renewable energy is a capital intensive business, disbursement of investment capital is make effective all in year 0. On the cost side, along with the operating costs you are paying financial costs for twenty years. The revenues came from three factors, PPA’s (power purchase agreement) FITs (Feed in Tariff) and the Load Factor (ratio between operating hours of your facility and the 8760 yearly hours). To function properly, this model needs stability.
The first condition to double the renewable energy percentage in the global energy mix is a minimum regulatory framework. To maintain a positive evolution and investment stimulus it is necessary a degree of stability, predictability and long-term orientation on policy that is nonexistent today.
Second: A necessary step to advance is to gradually remove subsidies to fossil fuels so as to achieve a real competitive market reflecting the real prices of all technologies.
In the document “The future we want”, which is being discussed now in Rio, and is meant to be the official document to be signed by chiefs of state in the next days; in the Section V: Framework for action, in the ENERGY section, #6 in a shy manner but clearly, is stated that fossil fuels subsidies inhibit sustainable development.
Third: The implementation success of the different measures have to take place during the present decade, otherwise, the negative effects would be very difficult to reverse. One of them is to lock-in the GHG emissions trajectory. The last measures of the Mauna Loa observatory (April 2012) registered more than 393ppm’s of CO2 in the atmosphere. We are in close danger to surpass the 450ppm’s goal for 2050.
Fourth: there are still 1,5 billion people in the world without access to electricity and it is Goverments and Leader Business Companies who have the responsibility of reducing this number down to the minimum. Distributed energy systems out of renewable energy are part of the solution to provide electricity to this rural areas, isolated from the grid.
Fifth: we need a stable and supporting regulatory framework that combines utilities and distributed energy in urban areas. Smart grids and fully integrating renewable energy are the right path to take. Of course, this will require a considerable investment which, in the long term will imply cost savings, improving energy efficiency and security of supply and last but not least, reducing costs and GHG emissions.