IRENA backs $46m RE projects, rallies clean energy sector on eve of World Future Energy Summit

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A concessional loan package worth $46 million has been announced at the IRENA 6th Assembly in Abu Dhabi for the development of four solar PV and solar/wind hybrid projects in developing nations.

The projects were selected by the International Renewable Energy Agency (IRENA) and the Abu Dhabi Fund for Development (ADFD), just a day after a IRENA report urged governments and private investors to up their funding for renewable energy globally, and on the eve of the World Future Energy Summit in Abu Dhabi.

The projects will receive funding drawn from the third cycle of the IRENA/ADFD development fund, and will be supported by private investment and government support in four selected locations: Antigua and Barbuda (to receive $15 million for 4 MW wind and solar project), Burkina Faso ($10 million for 3.6 MW PV mini-grid), Cape Verde ($8 million for 2 MW solar PV and wind hybrid) and Senegal ($13 million for 2 MW PV mini-grid).

All four projects will have a solar PV component (ranging from 2 MW to 4 MW) and will deliver clean energy in areas either lacking a current energy supply or running polluting fossil fuels such as diesel.

“Accelerating the energy transition to renewables requires all countries to take action to develop their own local renewable energy sources,” said IRENA director-general Adnan Z. Amin. While renewable energy resources are abundant in many developing countries, adequate finance can still be a barrier to deployment.”

The four selected projects will receive loans to finance 50% of the projected costs, with government and private investors providing the remaining 50%. This concessional loan method helps to mobilize enough funds to double the original investment, IRENA said.

Figureheads gather for RE discussion

In a separate event co-hosted by the Financial Times (FT), politicians, economists and leaders gathered for a IRENA debate called Scaling Up Renewables: Taking Climate Action to the Next Level, held at the IRENA HQ in Masdar City, Abu Dhabi.

The speakers included executive secretary for the UN Framework Convention on Climate Change, Christiana Figueres; European Commissioner for Climate Action and Energy, Miguel Arias Canete; Cook Islands Prime Minister H.E. Henry Puna, and head of environmental market groups for Goldman Sachs, Kyung-Ah Park.

More than 500 leaders from government, business and civil society were in attendance to watch the panel discuss how the world can best mobilize towards a clean energy future following the Paris Agreement.

Figueres set the tone for the discussion, musing how the world can figure out what is the financing model that will best help drive action on reducing carbon emissions, increasing the share of renewable energy and, ultimately, fulfilling the promises made in Paris.

“Let’s be realistic,” she said. “It [Paris] doesn’t guarantee that we can magically lift the barriers to RE integration. Does it help? Yes. Long-term direction is abundantly clear. There is a global agreement now about the direction towards increasing efforts toward decarbonization. It’s also a clear time period.

“The Paris Agreement is fundamentally different to the Kyoto protocol because it’s open-ended. It is a multi-decade commitment towards increasing global decarbonization, with five-year report cards – how did we do? Are we progressing?”

Figueres added that the fact that there are these long-term targets, clear periods, milestones, and transparent action points gives the Agreement integrity. She also welcomed the fact that the Paris Agreement is non-binding. “That these are voluntary goals is a strength. It is about every single country realizing from their research that they have to do something. Nobody is being clobbered to act. They are all using their own national interest to act; there is now perfect overlap between national interest and global integrity.”

However, Goldman Sachs’ Park warned that despite the positivity that has emanated from Paris, it will be the markets that decide just how much is invested in renewable energy – markets that are immune to promises but do respond to concrete action.

“Capital doesn’t move on political will, it moves on tangible action and policy,” Park said. “When the COP21 Paris Agreement was reached, the first trading day after saw U.S. solar stocks pop by around 5%. That’s a small flip. But when the ITC was extended, the markets for solar popped by around 30%, if not higher. That gives you a sense that markets need something tangible in order to make allocation decisions."

The debate was closed by UN secretary-general Ban ki-moon, who took the opportunity to reiterate the general tone of the Paris talks. “We can no longer burn our way to global parity,” he said. “Renewable energy is limitless and offers great security and peace of mind. It is often the cheapest option, too. And the more we do, the cheaper it will become.”

The talks followed a report published by IRENA on Saturday that found that increasing the world’s share of renewable energy to 36% by 2030 would increase global GDP by 1.1%, the equivalent of roughly $1.3 trillion. To reach this goal, the world would need to increase renewable uptake by 1% each year until 2030 – a six-fold increase on current installation rates.

The World Future Energy Summit (WFES) begins tomorrow in Abu Dhabi and pv magazine will be reporting direct from the show, so be sure to check back regularly for more updates and stories as they happen.