REN21’s Rana Adib on the state of renewable energy markets In 2023
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Transcript
00:00 The next Friday marks the final day of the UN's 2023 Climate Change Conference in Bonn,
00:05 Germany.
00:06 The two-week gathering aimed at preparing resolutions for eventual adoption at this
00:09 year's COP28 in Dubai.
00:12 High on the agenda for many, at least, is accelerating the adoption of renewable energy
00:17 sources.
00:18 Tuesday brought the release of the latest report on the sector from the REN21 Energy
00:21 Policy Network.
00:23 To talk to us about some of the details of that report, we can now bring in REN21's
00:27 Executive Director Rana Adib, who joins us from that climate conference in Bonn.
00:32 Rana, thanks so much for taking the time.
00:34 Let's start with the good news record growth in renewable electricity production.
00:38 How is it developing and where does it need to get to?
00:41 I think this is indeed a big success story of renewable energy and it's the result of
00:46 long-term policy attention to it.
00:49 So key drivers are clearly solar photovoltaics and wind.
00:53 We have basically today the electricity, 30% is provided by renewables and this is really
01:01 a great story.
01:02 It's a least-cost solution and is to be replicated in other sectors.
01:06 I think what is required here, however, is clearly more attention not only to the car,
01:11 so to say, but also to the roads that can bring the renewable electricity to the households,
01:16 to the energy consumers, and invest in grids.
01:20 So to stay on that topic, actually, let's talk about some of the barriers to progress
01:24 when you talk about cars versus roads, thinking about grid infrastructure.
01:30 What's holding the sector back there?
01:32 What is clearly holding the sector back is we have globally over 1 terawatt of projects,
01:40 in particular, in solar PV and wind that could be constructed and cannot be constructed because
01:46 they do not yet have the permits to be constructed, and the other part is they cannot be connected
01:50 to the grid.
01:51 So today the policy attention on this front is really to invest in grid infrastructure,
01:57 so investing into the roads, but also making sure that the projects can be developed and
02:01 connected more quickly.
02:03 The other part when we're looking at the power sector holding us back is that there is really
02:09 lots of increases, so a market share increase of 37% of solar photovoltaics, but when we're
02:14 looking into other sectors, so wind and also other renewable energy technologies, they
02:19 are lagging behind.
02:21 Here what is really important, these sectors are also touched by the inflation supply chain,
02:27 and we need to build up a sustainable renewable energy economy and industry, investment in
02:33 manufacturing, investment in skilling resources, and building up basically this technology
02:38 everywhere.
02:39 Your report points out that heating and fuel are two areas where renewables are really
02:44 lagging.
02:45 How bad is it and why is that?
02:47 This is actually a really bad part of the story.
02:51 It is as bad as in the heating sector, basically renewable energy does not even provide 10%
02:59 of the heat globally, and when we look at the fuels, it's only 3.7%.
03:04 Why is this a critical story?
03:06 It is a critical story because almost 80% of the energy that is supplied is supplied
03:12 by heat and is supplied by liquid and gaseous fuels.
03:17 What we clearly see is the transition in electricity is actually not enough, even though electrification
03:24 of transport sector, electrification of the building sector is absurd.
03:28 We know that in 2050, only 50% of the energy will be provided through electricity, and
03:35 the rest will need to be provided by heat and fuel.
03:38 We need policy attention today.
03:41 Unfortunately, only 46 countries have renewable energy targets for heat and only 49 for renewable
03:48 fuels.
03:49 This is compared to 174 on power.
03:53 Let's talk about some investment here.
03:55 Where is the most money flowing in terms not only of geography, but also as compared to
04:01 fossil fuel projects?
04:04 Geography-wise, we have a concentration basically on China.
04:08 55% of the investment are going to China, 11% in the EU, 10% in the US.
04:15 Only 1.6% to show the other extreme is on Africa and Middle East, so this is the regional
04:20 part.
04:22 When we're looking at the technology, there is indeed, we see that from the investment,
04:28 almost three quarters, when we look at the power sector where we have most of the investments
04:32 happening, go to renewable energy power, but still one quarter continues to go to fossil
04:38 fuel, even though it is more expensive and has basically all the defaults we know, climate,
04:44 health, social impacts.
04:48 It's a great sign, but it's not enough.
04:50 Another part, I think, when we speak about the investment is to also mention that $1
04:55 trillion US are being spent, have been spent in 2022 by governments to subsidize fossil
05:01 fuels.
05:02 This is an 85% increase over 2021, and these subsidies very clearly need to be shifted
05:08 away from fossil fuel to renewable energy, in particular renewable energy and renewable
05:13 energy transport or renewable-based fuels to really move the power transition to an
05:18 energy transition and move away from fossil fuels.
05:21 All right, that's all we have time for.
05:23 I want to thank you, Rana Adib, Executive Director of REN21 Renewable Energy Network.
05:28 Thanks so much for your time and for being with us.