Will a renewable energy champion step forward, please?

(Photo credit: International Institute for Sustainable Development)

Even as Filipinos are rooting for countryman Manny "Pac-Man" Pacquiao to trounce unbeaten challenger Timothy Bradley in an upcoming title defence, to regain his crown of world's best boxer pound-for-pound, so it is with the renewable energy sector.

A champion is needed

The call, made by moderator Sohail Hasnie, Senior Energy Specialist at the Southeast Asia Department of the Asia Development Bank (ADB), was echoed by several panellists during the 3rd Annual Asia-Pacific Dialogue on Clean Energy, Governance, Policy, Law and Regulation, held last month in Manila. The event is organised by ADB.

Sharing those sentiments was Hans Olav Ibrekk from the Norwegian Agency for Development Cooperation. He urged participants to identify champions and entrepreneurs who could build upon and replicate successful renewable energy business models, and scale them up.

Much of the lament comes from poor uptake of renewable energy, particularly in the developing economies. With that also comes the challenge of reducing greenhouse gas emissions while reinforcing energy security and tackling rising fuel prices.

Dialogue participants consistently recognised the critical need to increase the effectiveness of clean energy governance, laws, policy, and regulation towards these ends. Against the context of the United Nations's International Year of Sustainable Energy for All, many Dialogue participants focused their interventions on the efficient provision of energy access to all through sustainability and energy efficiency.

Public-private partnerships are key

Whether a champion can be found in the public or private sector remains to be seen. Panellists all agreed that now, more than ever, private public partnership (PPP) was "the way to go" to meet energy needs. Parallel tracks and breakout sessions over the two days established what everyone already knew--that private-sector investment needed to grow, a lot.

David Elzinga, Energy Technology Policy Analyst from the International Energy Agency (IEA), told participants that clean energy investments "need to increase by five times". For that to happen, "the public sector must play a supportive role".

Liu Hongpeng, Chief of the Energy Security and Water Resources Section at United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), shared that providing universal access to energy by 2030 was estimated to require an annual investment of US$48 billion, or about 3 percent of total energy investments worldwide. Asia's share will come to about US$12.3 billion a year, which Liu said should be invested in renewable energy technologies and energy efficiency improvements in order to move the region away from fossil fuel-dependent growth. His message would later be reiterated at the Rio+20 Summit in late June.

No magic wand

Shared sentiments aside, a senior executive from an established MNC, in an aside to the Energy Market Authority (EMA), voiced concern that the main obstacle for the private sector came from a lack of money and commercial viability in the region. Developing economies are typically so poor that the financial carrots needed to attract private-sector enterprise and expertise may not be economically viable.

Haruhiko Kuroda, President of ADB who opened the 7th Asia Clean Energy Forum (ACEF) which took place back-to-back with the Dialogue, with the theme "Accelerating Low-Carbon Energy for All", acknowledged the bank's limitations in spurring investments for clean energy and creating incentives for bigger investments. His message called to the private and public sectors to work together and leverage support in order to ensure energy for all.

Thus, from a public-sector perspective, governments need to create the necessary policy and regulatory frameworks to attract private-sector investments for increased energy access, said ESCAP's Liu. Engaging and ensuring profitable projects for the private sector would be essential for ensuring energy for all, he stressed.

One of the questions from the floor raised the issue of subsidies, which drew mixed responses from panellists. Session Chair Simon Rolland, Secretary General of Alliance for Rural Electrification, felt that subsidies in the long term were "not sustainable" and would be "difficult to remove". On the flip side, Mazmul Haque, Head of Investment, Infrastructure Development Company in Bangladesh, supported the idea of subsidies as useful to initially convince private-sector investors that an expensive technology was good and worth a try.

Key takeaways

Oh, and speaking of champs, all the best, Manny.

BY : Haresh Mohanan & Juniper Foo, Energy Market Authority