The key to an economic recovery: clean energy
Boldness takes courage in normal circumstances, but it requires another level of bravery to be bold in times of chaos and immense change. Yet if we want to avoid the most catastrophic outcomes of climate change, we have to act and invest boldly to cut emissions and hasten the transition to clean energy. We have always known that renewable energy needs to play a central role in that transition, but now we are tasked with navigating how we advance that transition amidst an intersecting set of global health, economic, and social crises.
The good news is that renewable energy is growing faster than all other energy forms. REN21’s recently released Renewable 2020 Global Status Report (GSR) showed that we can see the greatest momentum in the renewable power sector thanks to declining costs, efficiency gains, improved commercial viability, and overall strong policy support. But despite science and economics clearly demonstrating the value of renewables in the power sector, significant amounts of money still flow into fossil fuel-generated electricity. Furthermore, it would be short-sighted to celebrate the advances in the power sector without acknowledging the alarmingly low shares and slow uptake of renewables in other sectors such as heating, cooling, and transportation. Together these sectors make up over 80% of total energy consumed globally, and on-going dependence on fossil fuels means that these critical sectors are “stuck” in a continuous cycle of burning dirty energy. And we are suffering from the effects of that cycle: the true cost of fossil fuels is estimated to be USD 5.2 trillion when counting the costs of negative impacts such as air pollution, the effects of climate change, and traffic congestion. Disrupting that cycle will require bold interventions.
In the midst of the COVID-19 global shut down, many people pointed to decline in energy demand and the cleaner air and clear vistas in heavily polluted regions as illustrations of what is possible with significant human behavior change across the globe. However, even if the lock downs were to continue for a decade, we would still not see the necessary annual emissions decreases needed to meet climate objectives, and the economic and social impacts would be catastrophic. This highlights the need to think beyond individual behaviors and to drive a fundamental shift in how we manage our energy systems if we are to come anywhere near to reaching climate and development objectives.
Solutions exist to switch to an efficient and renewable-based energy system. We have examples of successful policies that can be used as models and demonstrate how minimizing policy uncertainty is critical to creating stable markets. As the governments across the globe determine how to rebuild their economies in the wake of the COVID-19 crisis, we need to ensure they are thinking about how to rebuild in a way that addresses the intersecting set of short- and long-term economic, health, and climate crises we face. We know that “green” recovery measures, such as investment in renewables and building efficiency, are more cost effective than traditional stimulus measures and yield more returns. Renewables also deliver on job creation, energy sovereignty, accelerated energy access in developing countries, reduced emissions, and air pollution. A green recovery that centers renewable energy will address these intersecting crises in ways that a traditional recovery will fall short.
Philanthropy has a key role to play in mobilizing public support for renewables, particularly related to enabling the transformation of the energy sector in emerging economies. Our foundation’s mission is to catalyze climate innovation and leadership through venture philanthropy. Innovative efforts we have supported include: shifting the political landscape for renewable energy; building transformative think tank capacity; facilitating donor and international financial institutions (IFIs) alignment; enabling clean energy finance; driving energy transition diplomacy; and engaging industry and business voices. However, as highlighted in the REN21 report, renewables—like the fossil fuel industry—face a challenge of securing the social license to operate. Factors influencing the public perception of renewables include health and environmental impacts, economic costs and benefits, and the fairness of consenting or consultation processes. In our grantmaking activities, we seek ways to help overcome barriers to the uptake of renewables while using science and data to expose the risks associated with carbon-intensive sources such as coal. Our network of philanthropic foundations support civil society partners who promote fair, transparent procurement; robust energy policy and regulatory frameworks; and local employment and community ownership.
I echo one of the key messages of the GSR 2020 report: communities and citizens have a huge role to play in the campaign for renewables. Our partners are actively and courageously pushing for diplomacy strategies that breakdown geopolitical barriers, for finance interventions that expose business and economic risks while also highlighting investment opportunities, for strategic communications that creatively leverage digital strategies to reach wide audiences, and for investor engagement and legal strategies that address issues such as land rights. Philanthropy must back these groups who are reaching communities and citizens with messages that resonate and are partnering with them to take action, even in a time when the world feels like it is stuck in so many ways.
There are four actions that governments can take now to set us on the path to a clean, low-carbon future:
- Increase policies that actively support the uptake of renewables
- Make energy efficiency mandatory to decrease energy demand
- Accelerate the phase-out of fossil fuels
- Orient investment using the money spent in economic recovery and public procurement
Urgent, focused, and coordinated action is crucial. And bold action must be taken now to break out of the cycle of dirty energy and to break into a future of sustainable recovery and development.
Blog is based on the author's remarks during a panel discussion hosted by REN 21 on “Public Support for Renewables” held in June during the 2020 Asia Clean Energy Forum.