In Paris, rich countries attacked India and China for their dependence on coal. Now, the tables have turned. Both nations are making massive investments in renewable energy, much more than their critics in the developed world
According to the UN report Global Trends in Renewable Energy Investment 2016 released by the United Nations Environment Programme (UNEP) in association with Bloomberg New Energy Finance (BNEF), the development pace of renewable energy projects across the world is witnessing an upswing, especially amongst the developing countries thanks to the exceptional increase in investments made by India and China. The robust investment commitments made by the two countries in solar, wind and other renewables have, in fact, surpassed the investment initiatives made by wealthier nations.
The report shows that investment in renewable energy, excluding large hydroelectric projects, has increased by five per cent to touch $285.9 billion. This is the highest since 2004 when the UNEP had started reporting investments in renewable energy.
The positive aspect is that it is more than double the amount ($130 billion) invested in coal and gas capacity additions across the world. These developments are encouraging especially in the backdrop of falling oil, gas and coal prices that could have compromised the growth in renewable energy projects.
The credit in providing impetus to renewable energy projects and investments goes to the developing countries which are doing much more than the developed countries to augment growth in renewable energy sector. This is even more relevant in the light of the criticism levied on the developing countries at the COP21 in Paris last December when India and China were attacked for their dependence on coal.
Now these countries are setting the global trend in renewable energy investments in the form of committing a total of $155.9 billion as investments in the sector. This commitment is not only 19 per cent higher than 2014, but also about 10 per cent more than their counterparts in the developed world.
The record-setting increase in investments is proof that renewables are becoming ever more central to low-carbon lifestyles of environmentally conscious people, and proving valuable in societies where reliable energy can offer improvements in quality of life, economic development and environmental sustainability. The continued and increased renewable energy investments is not only good for the people and planet, but is a key element in achieving international targets on climate change and sustainable development.
Countries such as China have realised the potential of renewable energy to rapidly power their economy especially in the backdrop of immense pollution related problems being experienced by the country.
Pollution is a sensitive topic in China, spurring public protests every year about environmental degradation, particularly from factories. Given these severe conditions, the authorities in Beijing are developing a network of ventilation ‘corridors’ to help tackle the city’s notorious air pollution.
The Government has set a target for 2020 of reducing pollution by 40 per cent from 2013 levels. The impact of pollution in China has had its irreversible consequences, the run news agency Xinhua acknowledged, that due to rising pollution levels and climate change the glaciers in western China have receded by nearly 3,000 square miles, about 15 per cent over the past 30 years.
China has responded exceptionally well in these demanding conditions and initiated a slow but determined process of protecting the environment against increasing levels of pollution. It has chosen investments in renewable energy as a primary weapon. As a part of the effort 2015 saw China blaze ahead of the rest of the world in terms of investment in renewable energy spending a total of $103 billion, or 36 per cent of the world total. The country invested more than the US ($44.1 billion), the UK ($22.2 billion) and Japan ($36.2 billion), put together.
India now has a lot to catch up with its neighbour — be it manufacturing, infrastructure or investments in renewable energy. As a first step, India must consider China’s model of penalising old coal-based plants, having an economically viable long-term renewable energy policy and giving robust monetary incentives for generation of renewable energy. The Government must also enforce the obligation on distribution companies to purchase power produced from renewable sources and penalise those who fail to meet their targets.
India has over 40 crore people without access to electricity. In order to ensure electricity to all and to ensure a sustainable industrial development that is based on clean power, India must end its over dependence on non-renewable energy. This is possible by incentivising renewable energy technology and providing healthy subsidies on renewable power generation.
China had to experience critical levels of toxic pollution in order to realise the value of renewable energy, India can learn smartly from the lessons of its neighbour and initiate suitable measures that can power the next chapter of India’s economic growth.