NEW DELHI: The meeting of US President Obama and Indian Prime Minister Modi in January has revealed how renewables are a “personal and national priority” for India. As the seventh largest clean energy investor in the world, the country is fast catching up in the global race to lead the low carbon economy.
Last year global clean investment rebound after a two-year decline, reaching a total of US$310 billion – an increase of 16% compared to 2013. The bold figure follows the International Energy Agency (IEA) forecast that investment in new clean-energy capacity will total US$1.61 trillion through 2020. At the same time though, IEA says the expansion of renewables is expected to slow.
Growth in clean energy investment around the globe has seen huge regional variations, due to different economies and levels of political will. China is leading the way, collecting a record US$89.5 billion last year, an increase of 32%.
Image: New investment in clean energy in China - courtesy of Bloomberg New Energy Finance, from “Global trends in clean energy investment” Q4
The Asian country is followed by the US with US$51.8 billion (up 8%) and Japan with US$41.3 billion (a rise of 12% compared to 2013).
Image: New investment in clean energy in the US - courtesy of Bloomberg New Energy Finance, from “Global trends in clean energy investment” Q4
More modest were the contributions of Canada and Brazil, with US$9 billion and US$7.9 billion respectively. However, these figures represent strong increases of 26% for Canada and 88% for Brazil. Countries in Europe collectively reached about US$66 billion last year, after the peak in 2011.
Image: New investment in clean energy in Europe - courtesy of Bloomberg New Energy Finance, from “Global trends in clean energy investment” Q4
A personal and national priority
In India, the markets are also following the positive global trend. The country is the seventh largest clean energy investor in the world, with US$7.9 billion invested last year and more than US$10 billion expected at the end of 2015. The visit of US President Obama in India this week also showed renewables are a “personal and national priority” for India’s Prime Minister Narendra Modi. The Climate Group’s India Director Krishnan Pallassana said the US-India climate collaboration that was confirmed during Obama’s visit will “help to secure India’s ambitious program around renewable energy growth.”
Image by The Climate Group, based on BNEF and UNEP figures
But India’s low carbon economy has been growing for a while. From 2006 to 2013, clean investment amounted to a cumulative US$61,689 million, Climatescope’s 2014 report states. The country’s renewable energy sector has been led by wind power, which accounted for 60% of capacity and 53% of all the investment in that time period. Nonetheless, the vast majority of energy is still generated by coal, which provided 71% of India’s total generation of 1,088 Terawatt-hours in 2013.
However, Modi has recently reiterated his commitment to “ambitious national efforts and goals to increase the use of clean and renewable energy”. His government plans 100 gigawatt of solar installations and investment of over US$100 billion in clean energy in the next five years.
Bold initiatives
To save electricity and reduce carbon emissions, Modi launched a program this week to install LED (light-emitting diode) bulbs for domestic and street lighting in 100 cities by March 2016. “We will be a renewables superpower,” pledged India’s energy minister Piyush Goyal. “Electricity can transform people’s lives, not just economically but also socially. My own father studied under street lamps.”
With 40% of India still not connected to the grid, this is not only an economic issue, but also a social and health problem – since many people in rural India are forced to use dirty and dangerous kerosene lamps. This is why The Climate Group’s program, Bijli - Clean Energy for All, is helping more than 25,000 people (and 25,000 more at the end of this year) to change their life providing clean and cheap renewable and solar-powered energy.
“For years now, we have taken energy for granted - never realizing its true potential to enhance productive capabilities of people,” commented Krishnan Pallassana, India director, The Climate Group, during his visit in one of the villages transformed by this initiative. “Bijli project has brought in multiple benefits, most important to enhance productivity and thus create a social revolution.”