Global Renewable Energy Transition: Who is leading? (A Focus on Asia)

Global Renewable Energy Transition: Who is leading? (A Focus on Asia)


>>Matt: Hello everyone. I’m Matt Keighley and welcome to today’s webinar
which is hosted by the Clean Energy Solutions Center
in partnership with the Renewable Energy Policy Network for the 21st Century, or REN21. Today’s webinar is focused on the Global Renewable
Energy Transition who is leading today’s webinar presentation, provides an
overview of analysis and findings presented in
REN21’s newly-release 2019 version of the Renewable Global Status Report with a
regional emphasis on Asia. Before we begin I’ll quickly go over some
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Renewable 2019 Global Status Report. Kanika will then comment on the financing
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and organizations. So now I’d like to provide a brief introduction
and welcome to today’s panelist, Vibhushree Hamirwasia. Vibhushree is the community manager at REN21
and we are pleased and honored to have her present the
findings of REN21’s newly-released 2019 addition of the renewables global status report. Vibhushree, welcome. As I set up
Vibhushree’s slides I’d just like to quickly remind participants to submit questions
through the questions pane at any time throughout Vibhu’s presentation and Vibhu the
floor is yours>>Vibhushree: Thank you, Matt. Renewables are firing the world. Twenty-six percent of
global electricity, [inaudible] energy 20 . Renewable energy also accounted for
two-thirds of the global investment in power generation. In all of this where does Asia
fit? Asia provides 40 percent of global energy,
but it also contributes to 45 percent of carbon emission. Energy consumption continues to grow and so
does demand. However,
most of these to meet this demand continues to come from fossil fuels. Good morning from Asia everybody, and welcome
to this webinar. Thank you for tuning
in. I would like to present some key findings
from our recently-launched Renewables 2019 Global Status Report with some focus
on what’s happening in Asia, and then I will pass it over to Kanika who will present some
insights on investment. Who are we? REN21 is an international policy network made
up of passionate players which belong to these five key stakeholder
groups, so science and academia, international organizations, governments, associations and
NGOs. What we do is we try and provide evidence
of the most up-to-date evidence on renewable energy and create knowledge to shape the global
energy debate in this transition to renewables. One of our flagship publications is the Global
Status Report, and this is the 14th year of its publication. This is followed by many other
on the global scale, including one for cities which will
be coming up this year. Apart from regional
reports, thematic reports, etc. where we also use this knowledge and evidence to try and
. One such is the REN21 Academy and another
one is the International Conference. The Renewables Global Status Report. As I mentioned, this is the 14th year of the
GSR as we call it. It includes thousands of data points and uses
hundreds of documents experts to provide the most up to
date information available. We look at advances
in renewable energy markets, policy frameworks and industries globally. This production
of the GSR is not something we do solely at REN21 but we quickly build on a
multistakeholder community of over 1,500 individual experts who actually are the key
contributors to this [inaudible] publication. What’s happening in the world of renewable
energy? 2018 was another strong year for
renewable energy. Total capacity grew 8 percent which includes
hydro power, even the growth is even faster when you look at non-hydro
capacity, so it grew 15 percent. By the
end of the year hydro power no longer accounted for more than half of installed power
capacity [inaudible] at 48 percent. Meanwhile wind and solar [inaudible] continued
to – additions in wind and solar PV continued to increase,
and for the first time totaled around 45 percent. Investment in renewable energy although fell
globally, fell 11.5 percent in 2018. It was
mainly driven by a sharp decline in China. This was a result of policy changes that
reduced financial support for solar PV projects in the country. However developing an
emerging economies overtook [inaudible] developed countries in investment for the first time
in 2015 and it retained this lead in 2018 although it was by a much smaller amount. Investment also declined in India but rose
in the rest of Asia. When I say it
excludes India and China as in Asia Pacific. However despite this decline
in China accounted for a majority of global investment which came in at
72 percent. When you look at Asia-Oceania excluding India
and China that was 15 percent of global [inaudible] so still very significant. India was somewhat smaller, about five percent. So while investment Asia, including
India and China, investment. I think one of the biggest characteristics
of this energy transition is renewable power where the power sector has been leading, and
renewables have been supplying more than 26 percent of global electricity. This was the case in 2018. For the first time more
electricity was from solar PV than bio power and there was a strong growth in renewable
generation but with the rise in demand in electricity it makes it harder and much more
challenging to achieve largesses. So renewable power now makes up one-third
of global capacity. This [inaudible] is absolutely
amazing as the global composition shift with as I
mentioned hydro power is no longer more than half of installed capacity
and wind and solar have been increasing, which is – when you look at the composition
for the last ten years this is quite [inaudible]. In terms of addition this was 181 gigawatts
of renewable power and around 55 percent of these new additions was solar PV followed
by wind, hydro and the rest, so bio power, CSP and geothermal. 2018 was also the fourth consecutive year
where more than 50 gigawatts of wind power was added. This I think is the most encouraging slide
of all where we say more renewable power capacity was added compared to fossil fuel
and nuclear power. So if we look at pure
installation this marked nearly two-thirds which is 64 percent of net installation from
renewable sources of energy. This marked the fourth consecutive years that
of renewable power were above 50 percent. If we dig deeper into technology solar PV
capacity additions passed the 100 gigawatt mark. This means the cumulative capacity was 505
gigawatt, an increase of 25 percent from 2017. Asia was the main world market for solar PV
for the sixth consecutive year, led of course by China, followed by India and then several
other markets in Asia, including Japan. However in the region’s top
three market were clearly China and Japan. Asia was followed by the Americas. The top five markets were responsible for
about three-quarters of newly-installed capacity. Floating solar PV is quite an interesting
technology for Asia. It’s quite new, and this has
been driven by rapid development of [inaudible] solar in China and in other Asian markets,
including Japan, Korea, Chinese Taipei and then also the U.K. One of the most
interesting parts about this is that the first floating PV installation was a 20 kW pilot
system which was in in 2007, but just over a decade later floating systems
exist in at least 29 countries, in nearly every region of the world, and are under
consideration of development in many more countries. This is perhaps an interesting
development for the region. Wind power continues to increase steadily
year on year and it was up nine percent in terms of additions, so the cumulative capacity
was up 591 GW in 2017. Of the additions
this includes both onshore and offshore with first the majority being onshore for the
moment, but offshore being quite significant as well. If was the fifth year where annual
addition exceed 50 GW but also was the third year of decline following the peak in 2015. Offshore wind has very significantly been
concentrated in Europe but it’s now sparking interest in other parts of the world as well. So by the end of 2018 there were 17 countries
globally which had offshore wind capacity. The U.K. is a clear leader, however seven
countries in Europe and two in Asia connected about 4.5 GW in using global cumulative
capacity by 24 percent last year. Europe is still very much the leader however
with 79 percent of global capacity. Bio power continues to rise, including 6.5
percent in 2018 and bio electricity generation increased nine percent, most notably in China. The EU remains the largest in [inaudible]
by region but other countries included China,
Brazil, Germany, India and Japan. Hydro power. When we talk about hydro power the market
in 2018 looked very similar to the preceding year in terms of capacity and
concentration of activity. It added an
estimated 20 GW to [inaudible] install capacity of around 1,100 GW. China was the clear
leader with 35 percent of new installations but this was followed quite closely by
countries in the region such as Pakistan, India and of course other Central Asian and
other markets. Geothermal is another interesting technology
for this region, especially since Indonesia and the Philippines are quite significant
in terms of geothermal power capacity. And
estimated 0.5 GW of new geothermal power generating capacity came online last year. This brought the global total to around 13.3
GW. Turkey and Indonesia, as you can see
by this slide, were about two-thirds of new capacity. Modern renewables. I think all of these slides show quite clearly
that modern renewables are slowly gaining ground with [inaudible]
energy demand. But as you can see – we spoke
about 26 percent of the power sector came from renewables, but here you can see that
the renewable share of total final energy consumption
only 10.6 percent. This means this is
total final energy demand which includes all kinds of end use sectors and this is where
we still need to . So progress in heating, cooling and transport
has been very limited, as we can see from the following slide. Heating and cooling are increasing very slowly. Heating and cooling
is 51 percent of total final energy consumption, however this is at around
10 percent. The demand for it is quite dismal and minimal. There is a lack of policy
support in this sector, and the number of countries with regulatory policies fell from
21 to 20 – the one that removed its policy support
was Kenya actually. And only 47 countries
had targets for renewable cooling. Bio heat is a majority component of the renewable
energy in the heating sector but integration with the power sector . The growth rate has slowed for solar water
heating capacity addition. Cumulative global
capacity is 2 percent, and a majority of this is glazed collectors, and
2018 increase was the smallest of the last ten
years. Moving on to transport sector, again, there’s
a lot of talk, especially in Asia and other regions of the world about electrical renewables
and electric mobility. And so biofuels
and EVs are growing, but the renewable will remain the leader, and
transport is 32 percent of total final energy consumption, whereas renewable energy in
that is 33.3 percent. So extremely small. Transport also accounts for around a quarter
of global CO2 emissions, and while renewable
share grew a bit it’s not enough. Biofuels
make up the majority of this contribution but the sector is increasingly open to
electrification as we see with trends in transport. However we see that – and you can see the
next slide the electric passenger vehicles stock grew over 60 percent so the electric
mobility revolution is here and it’s happening and we all talk about here
talk about it. So we have about 5.1 million
electric cars on the road and 260 million electric two- and three-wheelers, which is
particularly interesting [inaudible]. Electric cars, however, despite this growth,
it’s still a small share of all passenger vehicles at just over
2.1 percent at the year’s end. EV market is also highly concentrated – 40
percent of all EVs were clustered in just 20
cities, [inaudible] together account for three percent of the global population. China of course
is the leader of the global EV stock in 2018, and it was followed by the United States. What does all of this electric mobility revolution
mean? You can see there’s very little
direct linking of EVs and renewable. EVS can play a role in increasing renewables
in transport when powered by renewable electricity,
and that is a very important point to keep in mind while we’re all working in this
transition. There was only one country with
policy support directly linking renewables to EVs, whereas around 49 countries have
independent targets of each other, of renewable electricity. So they’re not exactly linked
and while is this revolution it’s not – the link is totally quite minimum,
or negligible even. So if you put whatever we’ve seen so far together
we see that we have to go beyond power, or 80 percent of total [inaudible]
electricity consumption and demand comes from heating, cooling and transport. Power is only 37 percent of this equation,
and of which we are making really good progress with 26 percent
of renewable energy, however, heating, cooling and transport is where we need to
speed up the transition. Now when we look at – and then when we look
at global transport energy needs where else do they come from if not renewable energy? They come at [inaudible] and petroleum
products and 0.8 of country . So why are advances in the power sector
happening so fast? A lot of the advances have been made possible
by policy support. As you can see 135
countries have power regulatory policies as opposed to 20 countries for heating and
cooling. Transport [inaudible] somewhere in between
with around 70 countries, but the disparity is really large. The number of countries with heating and cooling
regulatory policies fell from 21 to 20 as you might remember
from one of my earlier slides. There
were no new – outside the power sector renewables have policies for renewables have
advanced at a really slow pace. There were no additional countries that adopted
biofuel standards and no new countries that added
regulatory incentives on mandates for renewable heating and cooling. Carbon pricing policies are among the policy mechanisms that can stimulate interest in low carbon and renewable
energy technologies, but by the end of 2018 these covered only 44 countries. This means that targets are certainly uneven
across sectors. Targets in the power sector, as you will see
from the bottom part of the slide, the bottom graphic, are far more ambitious and
far more – and will be achieve or have for far less time, achieved in far
less time versus targets for renewable heating, cooling and transport are not only less numerous
but so far less ambitious. This trend has
continued despite a much greater contribution of these sectors to total final energy
consumption. The 100 percent renewable energy movement
is in the power sector but especially in the power sector whereas Denmark
is the only country with a target for 100 percent renewables in total final energy. It’s one country in all of the world. As I mentioned, carbon pricing exists in some
countries, at least 54 carbon pricing initiatives implemented by in 2018; 27 of
these were emission trading systems and 27 were carbon taxes. They cover 44 countries, and they also cover
only 13 percent of global greenhouse gas emissions. So why is this a concern? One of the biggest issues is that renewables
don’t operate on a level playing field with fossil fuels or nuclear. Fossil fuel subsidies, as you can see by this
slide, are still extremely widespread. Global subsidies reach an estimated $300 billion
in 2017 which increased from the year before,
and this was about double the estimated support for renewable generation. Fossil fuel subsidies have remained in
place in at least 115 countries in 2017 and 73 countries provide subsidies of more than
$100 million . We strongly believe that as the renewable
energy sector requires stronger policy action but now we are not on track to limit global
warming to 1.5 degrees, and to achieve SDG7 goals for renewables efficiency and energy
access. And these climate developments
which are call for accelerating the transition from fossil fuels to renewable
energy. If you look at this slide it tells you which
countries . I think for me
personally the second [inaudible] which says investment [inaudible]. It is in the first one you
have a lot of the large economies whereas in the second row you have ,
Palau, Djibouti, Morocco, Iceland, Serbia, countries that normally don’t show up. These
show very clearly the disproportionate rate at which smaller and developing countries
invest in renewable energy. If you go on to the next slide you’ll see
renewable energy leaders at the end of 2018 – I’ve
marked the ones which are more relevant to Asia. Of course China and India are on many
of these lists but you’ll see geothermal has quite a lot of . Solar PV [inaudible] in
Japan, India and China, and renewable power capacity hydro power is also
quite interesting . It’s important to consider that jobs are increased
in 2018. The renewable energy sector
employed around 11 million worldwide with solar PV being the largest employer, and the
largest employer in the region was of course China, followed closely by India. Where is Asia leading? It’s the largest regional wind power market. It has an increasing
number of people employed in off-grid solar and biofuels and excluding India and China
it accounted for 15 percent of total renewable investment. It increased six percent, the
highest in three years, and it has the largest percentage increase in R&D. But another
very interesting point from 2017-2018 was the 91 percent of the population now has
access to electricity. Asia is also leading the global decrease in
primary energy intensity. This was
characterized by more efficient manufacturing facilities and also the share of energy-
intensive industry and commerce has continued to shrink [inaudible] to all other economic
. Energy demand in non-OECD countries, which
includes a lot of Asian countries, continues . This is particularly relevant for Asia because
energy demand is growing at a very rapid pace in the region. But a lot of this energy demand is made by
fossil fuels in India with the majority of coal-fired and have been located
in the region. In addition, 200 GW of coal-fired power plants
have already been commissioned in Asia and the Pacific, so this
really shows a disconnect between energy demand and what it’s being supplied by. Next please. Global household electric [inaudible] consumption
increases with the most rapid increase in Asia with an average annual growth of .7 percent. And as I mentioned, access to energy
has expanded. If you look at the graph, the second box,
or the box in the middle up top is about – talks about all developing and emerging
Asian countries, and you can see that in the last eight, nine years or so electricity
access increased quite substantially, and so did
access to clean cooking. India was one of the countries where this
situation is quite drastic. But all of this electricity access does not
mean that it’s . Off grid solar PV is increasing. Now 150 million people across Africa and Asia
benefit 5 percent of the population
in Africa India. Many of the
solar [inaudible] provided electricity access to about 9 percent of the
population . Looking at the off grid solar systems there
has been a 50 percent annual growth rate between 2010 and 2018. Also the dynamics of the market have changed
quite a bit: so [inaudible] sales have decreased, large solar home systems have increased. When we look at cooking production expanded in new markets, 125 million . However, the use of . It’s safe to say renewable energy is powering
the world. You can see that increasing
demand has to be met by long-term planning and supporting policies which has been one
of the main drivers in the power sector, and technology and market development. I want
to leave this on for about two, three seconds so you can take a look and see the power
sector has created a really good system for increasing renewable energy uptake and it’s
reliable, mainstream and here to stay. But what we really need in order to achieve
climate and development goals is moving from an electricity transition to a system
transformation. I put this graph, again, which
shows you that heating/cooling/transport consumed more energy in the entire energy
system. Ours is a much smaller portion, and many people
continue to confuse electricity for energy but the energy system requires
a much greater transformation in the electricity sector. How can this be done? You need to create a level playing field by
removing fossil fuel subsidies, as we notice, and adopting more
carbon pricing, encourage more sector integration amongst all of these end-use sectors,
and align policies across national, subnational and local levels. But it’s also important to link
energy efficiency policy initiatives. The transition is possible, and we have very
good examples from the power sector which show how this can take place and how best
practices and case studies in the power sector apply to the other end use sectors. Leadership from national governments is paving
the way towards 100 percent of renewables in countries,
and cities and subnational governments are actually setting more ambitious
policies than their national counterparts. As I mentioned right up top, the new RDF coming,
renewables in cities, global status report will tell you much more about that,
so watch out for that towards the end of the year. Over 1,000 organizations in this talks about
the private sector’s contribution to renewable energy – 1,000+ organizations have committed
to divesting from fossil fuels and the private sector has doubled its investment
in power. So if you look at your examples, Ireland became
the first country committed to divesting its public sovereign development from coal,
oil and gas, and Costa Rica, which sources, . So you can see there are several examples,
but in order to achieve this transformation . So what is needed to advance this energy transition? As you’ve seen, renewable power –
and it shows really good examples and case studies which will dip into other end use
sectors and transport. We need to set more ambitious targets globally
across regions, countries and sectors, accelerate investment in renewable power. So that
doesn’t stop making advancements in power, but we
development of new policy strengthening existing policies required for . We
need to encourage our sector integration to happen between the other [inaudible] sectors,
and policies need to be aligned between regional,
national and subnational . We’ll have to support cities in their actions
as well, and support local job creation and adjust to transition. So that brings me to nearly the end of my
presentation. As you can see, . A
lot still needs to happen, and a lot needs to happen very quickly actually. Please do feel
free to [inaudible] the entire report and the graphics and the presentation that I showed
you is available on the microsite which is REN21/GSR. You can also [inaudible] with us and keep
track of our activities [inaudible] newsletter. The next upcoming of significant
development for REN21 in the next six months is the launch of the new renewables in
cities global status report which you will find online. We’re also developing a regional status report
for Asia and Pacific which will be launched at KIREC, the you
see on screen in the 23rd to 25th of October in
Seoul, and we’d love to hear from you because as you know, we work with this
community if you have something to contribute or if you’d like to be a part
of the please feel free to . Thank you for giving me the opportunity to
present and I now over to Kanika.>>Matt: Thanks Vibhu for a great presentation. As a reminder, participants can submit
the questions through the questions pen at any time. We want to get as many questions as
possible in the Q&A session after this next presentation. Now I’d like to make a warm welcome to Kanika
Chawla, who is the director of the Center for Energy Finance at the Council on
Energy, Environment and Water. Kanika,
welcome.>>Kanika: Thank you very much, Matt, and
also I’d like to congratulate REN21 on an outstanding global status report for a 14th
year in a row, if I got that right. I think there’s a lot of really interesting
findings that Vibhu just presented, and a lot of
what I’m going to talk about now are really reactions to some of the things Vibhu
presented. But given that the context of a lot of my
work, as well as what I’m supposed to be speaking about today is finance I’m going
to pick up on the aggregate investment flows into the renewable energy sector in
Asia which stands at 52 percent. So if you add
up China, India and the Oceanic region that amounts to more than half of all of global
investments in renewable energy, which sort of seems to suggest that there’s a lot of
activity in the renewable energy markets in this part of the world. But that being said, when we see – break
that up into the sum of its parts we realize that
only 15 percent of that money went into countries, if you were to exclude China and
India. But that is not an insignificant amount. If you were to think about the total
investment flow which is close to $300 billion, slightly short of $300 billion 15 percent
of that is not an insignificant amount of capital,
especially if you were to think about the kinds of advances being made and given the
declining prices of renewable energy. But
even within that I think it’s interesting to see how most of that capital went into
power sector advances only, not so much into end
use sectors. And also how it was sort of
mostly concentrated in some countries in Southeast Asia rather than – and not as much in,
say, countries in Central Asia. And so then to me I would like to sort of
structure what that mean, include three categories. One is around market design and what is the
role that market design plays in attracting capital but also using the capital as a proxy
for deployment of renewable energy and advancing the energy transition. And then how do you unlock private capital
to flow into countries where the potential for renewable
energy is perhaps the largest in the world, given that a lot of the countries in Asia
lie between the tropics and have very high solar
radiance. But also given that geography have a lot of
high wind potential and have a long history as well with biomass as we’ve seen
in Indonesia and other countries in Asia and then recent advances being made in hydro and
geothermal. So how do you attract more
capital? And then the third one is around inter linkages
and regulatory environment. Vibhu
mentioned this briefly around how do you think about the energy transition in a more
integrated way rather than just in a way that focuses on say power sector separately and
then mobility separately and industry separately – how do you sort of connect the dots
and have a comprehensive view and optimize for the energy transition both in terms of
the resources required both in dollar value as well as in human capital. But then also
optimize for the timeliness of that transition. What I found very interesting was when the
slide suggested that 135 countries had regulatory and policy targets for renewable
energy, most of them in the power sector, but
111 of those were still continuing to following the feed-in tariff regime. The feed-in tariff regime, as you’ve seen
in several parts of the world has been highly effective because it provides the impetus
and the fiscal incentives required to drive the
energy transition, but it is not the most economically-efficient way to make that transition
from the exchequer’s point of view. This is really interesting because as the
price of renewable energy, especially if you were to
think about the price of renewables electricity is declining significantly, it’s now – we’re
now moving towards a world where the kind of
policy support required continues to be large, but the kind of subsidy required is actually
declining, because the economic case for renewables is much stronger in and of itself;
renewables got close to parity when compared to several other sources of energy. And
there is much more interest in optimizing for the most efficient fuel from an economic
point of view as well as from an emission point of view. And when renewables become
competitive in that space there is a declining need for feed-in tariff. So I think that for a
lot of the countries in Asia where there are quite well-developed markets but their power
sectors are currently at an inflection point where they’re expanding and moving sort of
more away from just publicly-owned generation assets to more privately-owned
generation assets this transition can actually be supported through a price discovery
mechanism like reverse auctions which build transparency and coherence in the market
but need not actually put a significant burden on the exchequer in the form of feed-in
tariffs. The second point is around mobilizing private
capital and in this space, as I was saying before, if more than half of the world’s capital
into renewable energy is flowing in Asia, which is only actually 40 percent of the global
energy supplied and that should mean that we’re actually doing something right. But as Vibhu mentioned this is disproportionately
skewed in China’s favor, a lot of which is actually domestic public money from China,
so how do you think about how do you mobilize
private money because a lot of other countries in Asia, given that they’re on a
development trajectory, do not have boundless public reserves to pay for this energy transition
and there is a need to crowd in private capital. In order to do that it’s important to understand
what are the risks that are plaguing the flow of this capital, and that’s where a lot
of the issues around market design come in, how sustainable are these policies that are
being deployed, but equally also what is the financial health of the utilities that are
going to get involved, how integrated is the plan,
and is there policy certainty. So especially in the sectors that are still
emerging, whether it’s sort of rooftop solar, offshore wind,
new geothermal applications but also electric mobility, end use, renewables for end use
purposes, these are all sectors that require a lot
of policy certainty at the moment because they don’t have the long history that solar
and wind installations have, and therefore investments
are contingent and predicated on the fact that are we providing a conducive environment
for them. And is that policy certainty
going to last? So if I make a long-term investment decision
will I get returns on that investment? That is in fact I think increasingly the role
of policy is to ease the process of investment, is to enable long-term and integrated decision
making rather than just provide subsidies or fiscal incentives to drive this transition
forward. The use of public money needs to be
in catalytic ways that is market-making, so it needs to be in addressing some of the risks,
it needs to be in designing the types of market environment that’s required, as well as in
supporting R&D and underserved markets but not really in project financing but in
driving in private project financing. In order to do all of that, then, regulation
also needs to keep up with targets policy and the
long-term view that governments take. And often what we see – and this is especially
pronounced in Asia, is that we see very large targets being announced, and political
ambition being very much in keeping with less than 1.5 or the energy transition, but this
does not always translate into regulation on the ground. That is in fact a huge challenge
because the regulation on the ground is really what drives action in a market and creates
robust markets. So in order to do that the electricity regulators,
the industry regulators, the city authorities, they all need to work
together. It’s not enough to have a topline target,
it is a need to break that down into the sum of its parts. So that would require much
greater action and coordination between different ministries, between different public
entities as well as we between entities and private entities whether they are industry
or investors. And so to my mind the three communities or
three stakeholders that are going to drive the
energy transition forward are governments across sort of international, national and
subnational but then also industry and then investors. And how do you bridge the gap
between the three of them and build coherence? And I think that a lot of the work that’s
been done in the global status report does take us some distance in building coherence
but it also identifies all of the areas in which
more work is required where gaps need to be filled. And it also sort of takes stock of what works
and what doesn’t work. It’s interesting to
note that so many countries are adopting fiscal measures that act as penalties, so carbon
prices or shadow carbon prices or cap and trade mechanism which is a means to price
the externalities and the externalities could
in the Asian context could include everything from air pollution but also much more to actual
emissions and beyond. So I think there is significant advances the
renewable energy sector has made predominantly in the electricity space but
there is much greater need for better interlinkages between that and what happens
in industry, end use consumption in industry for heating and cooling, for industrial processes
as well as for commercial and residential use, as well as in mobility. And in order to do that there has to be a
sort of multiple- pronged approach. One is going to be to take a strategic view
on how much electrification of these processes are we likely to see in
the coming years? Are we going to actually see
a large move towards electrification of the mobility fleet, electrification of industrial
processes, electric cooling, electric heating, or are we going to do a process heat sort
of fuel cell based transition [inaudible]. Countries just need to make these strategic
roadmaps. And in order to do that that doesn’t
mean that they need to make that transition today but they’re never going to be able to
make it effectively if they don’t plan for it in an integrated and strategic way, starting
now. I think the GSR is a really good call for
action and it identifies what countries need to do going forward. So I’ll stop there.>>Matt: Thank you very much for those thoughts. We’re shifting to the Q&A session
now. I’d like to remind our attendees to submit
their questions through the question box at any time. We’ll attempt to answer as many of these as
possible, however if we don’t get the opportunity to do so we’ll talk to you
outside of this webinar. I’ve got one question here in particular that
feeds directly into your points Kanika but I’ll
let Vibhu answer this first. And this is with an Asia focus in mind: What
policies can be utilized to best address the integration of
power, heating and cooling and transport? Is
there one or two key overarching or holistic policies, or will a policy mix be required,
and if so what would this look like?>>Vibhushree: I can start and then Kanika
please feel free to jump in as well from your experience. I think one good example of a region trying
to do this now is the European Union with the carbonization strategy for
203. I think when we talk about a set of policies
we have to think of the goal of decarbonization in mind. That’s where sectoral the end use sectors but also integration between vertical policy integration,
regional, global, national, subnational, cities is required. So I think there are – when we
talk about policies that’s what also Costa Rica and Denmark are talking about is
decarbonization of the energy system. That is what the basis of other policies need
to be thought of as one energy system rather than
electricity or something or for
cooling or for transport because it’s really decarbonization that is the goal. That’s my
opinion; Kanika, do you have anything in addition?>>Kanika: I think I completely agree with
your – and then the EU is a very good example, but I think the answer is also partially
in the question, that you need a suite of options and also what works in one part of
the world or in one region is unlikely to be
exactly replicable in another region, and that’s just because we have very, very – energy
transition in different parts of the world is going to look different from each other. There
is no one solution fits all. So I think it’s important to take the spirit
of the combined action and this multipronged approach and a suite
of solutions kind of approach the EU is following but then tailoring that to the very
specific requirements of our countries. That’s
a function as well of economic growth, domestic drivers and priorities but
also resource availability and the very specific institutional design. For instance the institutional design in a
country like India is significantly different from
what is in China which are both very different from what is likely to be a possible
solution for Laos or Cambodia. So I think we need to take the approach of
coordination between different departments and between
different sectors, but really then make these folk solutions for our countries and our regions.>>Matt: Great Kanika. Any second thoughts on that, Vibhu, on those
points Kanika made?>>Vibhushree: No, I completely agree. I think that’s one of the – I completely
agree with Kanika, so I think both of those points, that
we look at examples that exist for inspiration but really delving down to what’s relevant
or what’s the regional situation is important. And having said that I think if the key is
really to coordinate or integrate these policies across the vertical line which is in the governance
systems you have [inaudible] global, national, subnational, cities .>>Matt: Thank you both for answering that
question. Similarly, but acknowledging the fact that
governments and organizations sometimes have resource constraints in this environment
and with enough regional focus in Asia what should countries prioritize over the
next, say, five years or so, and maybe it’s sort of
timeline for their policies? Should they focus on renewables or should
it be a much more integrated approach that they need to focus
on?>>Kanika: I think that for the countries
of Asia the economics are so compelling, especially of more proven and lower capital-intensive
technologies like solar and wind that it is really unavoidable, especially
in the power sector for these countries to transition
towards these technologies. And given the growing demand in a lot of the
Asian economies there is the space to follow one
of these, “We will do it all” kind of approaches where we will do renewables or
we will continue to operate whatever thermal assets we have, and then plan a phase out. So you don’t actually at the moment need to
plan for the transition between thermal and renewable energy because of the growing
demand an recent electrification growth in the region in Asia. Also taps into this latent
demand. As Vibhu’s slides pointed out there is also
growth in aspiration where you can see even in
rural areas a move from pico solar to larger home systems, etc. So the demand is likely to
continue growing, and that makes Asia significantly different from other parts of the
world where we are seeing a plateauing of energy demand. So in that context I think that
it would be unwise to delay this adoption of renewable energy any longer. Despite
limited resources, given the huge decline and competitiveness of decline in price and
then competitiveness of renewable energy the time
is right. And the energy transition is really
here and now for all of our countries, whether they’re developing or whether they are
slightly further ahead on that development curve or whether they are more developed but
it’s really a function of how efficiently we make this transition and again how do you
make it timely and how do you make it one that you don’t really use stopgap solutions
but really sort of leapfrog to end solutions like
a cleaner energy mix which is predominantly renewable energy-based. So I would say that if you have limited resources
use that to figure out grid integration challenges, use that to figure out transmission
upgrades so that you can integrate more renewables into the grid and use that to figure
out an integrated resource plan that looks forward, not just to 2030 but really to the
middle of the century so that you can have a
strategic plan to get the .>>Matt: I think we just lost you there, Kanika,
but just passing on to Vibhu, any question comments on that question on those points?>>Vibhushree: Yes, I think everything Kanika
said is very relevant for in terms of priorities as well, like she spoke
about grid integration, etc. I think
one of the key characteristics of Asia that I’ve been noticing for this exercise for the
Asia report is that one of the biggest challenges
is actually in terms of energy security and sovereignty. There are parts of the region where a lot
of the current energy supply is actually imported and I think in terms of
the drivers that that’s one of the key drivers that
countries could look to to [inaudible] the security of [inaudible] supply but also the
sovereignty because this is an interesting term I heard
yesterday since I met [inaudible] in Asia about how
countries need to consider sovereignty as a priority and that could be a key driver
to integration of priorities and
resource allocation and when you are considering the energy transition. I think this is one part, but apart from this
and we’ve been doing a lot at REN21 is considering that a mindset shift is required
and we need to start thinking of an energy system as a whole , and I mean
I mentioned it several times; Kanika has mentioned it several times. I think that is the biggest takeaway for Asian
countries like [inaudible] in Asia where the situation is
very different from the rest of the world in terms of a way the economy is growing, but I think mind shift if you talk about
understand that energy underpins everything we do is important.>>Matt: Fantastic and well-said Vibhu and
Kanika. Thank you both for that. We might must conclude the Q&A session there,
so thank you both again for that. On
behalf of the Clean Energy Solutions Center I’d like to extend a hearty thank you to both
Vibhu and Kanika for their presentations and to our attendees for participating in today’s
webinar. We very much appreciate your time and hope
in return we provided some valuable insights that you can take back to
your ministries, departments or organizations. We also invite you to inform your colleagues
and those in your networks about Solutions Center resources and services, including our
free Ask an Expert service. I invite you to check the Solutions Center
website. If you would like to view today’s
slides and listen to a recording of the presentation as well as review previously-held
webinars. Additionally you will find information on
upcoming webinars and other training events. We also post webinar recordings to the Clean
Energy Solutions Center YouTube channel; please allow about a week
or so for new audio recording to be posted. Finally I’d like to take a moment to invite
you to take a moment to complete the short feedback survey that will appear when we end
the webinar. Please enjoy the rest of your
day, and we hope to see you again at future Clean Energy Solutions Center events. This
concludes our webinar for today. Thank you very much.

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