Reflecting on the importance of renewable energy

Recently there was a major event in the Philippines on clean energy. Bernardo M. Villegas writes in the Manila Bulletin about many of the themes that were developed.


Moral dimensions of renewable energy (Part I)

In the recently held Clean Asia Energy Forum sponsored by the Asian Development Bank, speakers strongly recommended greater investments in clean energy and energy efficiency to meet rising Asian demand while limiting the impact of climate change. An optimistic view was taken by Bindu Lohani, ADB vice-president for knowledge and management and sustainable development. He pointed out that renewables are becoming more competitive as technology progresses but lamented the fact that the low hanging fruit of energy efficiency is not being sufficiently pushed in Asia. He told the audience not to be deterred by the current low prices of oil and other fossil fuels. Given the history of great volatility of oil prices in the past, he surmised that “low prices will end even if we do not know when.” On the other hand renewables continue to experience rapid development and prices can only go down in the long run.

A local group called the Philippine Solar Power Alliance (PSPA) shares the optimism of Mr. Lohani. The group, which consists of the country’s solar power developers, signified their intention to the National Renewable Energy Board (NREB) to build as much as 2,000 MW of solar power projects in the country over the long run. Predictably, the group has set as a condition certain innovations on the Feed-in-Tariff (FIT) scheme, a framework under which the Department of Energy offers long-term contracts and guaranteed pricing to renewable energy firms.   One of their requests is for FIT not to be based on output since in some countries like Germany, with solar power becoming cheaper and more competitive, the government has shifted to incentivizing batteries for solar power storage, which can also benefit all sources of energy, whether renewable or not.

ADB announced that since the Asia Clean energy Forum started nine years ago, clear energy investments in Asia and the Pacific have risen to some $106 billion in 2013. It added that new mechanisms to spur clean energy have become more common. Among these are renewable portfolio standards, feed-in-tariffs, and concessional fundings for clean energy projects. ADB has increased its own financing for cleaner energy from only $280 million in 2005 to $2.4 billion in 2014. Despite these efforts, however, 600 million in Asia still lack access to electricity and dependency on fossil fuel remains high.

Worldwide the trend is no different. According to economist Martin Wolf of the Financial Times (June 24, 2015), the latest Statistical Review of World Energy of British Petroleum shows that global demand for commercial energy continues to grow, largely driven by growth of emerging countries, despite improvements in energy efficiency. Moreover, fossil fuels still meet bulk of the demand. In 2014, renewables contributed just over 2 percent of global primary energy consumption. Together, nuclear power, hydroelectricity, and renewable contributed merely 14 percent.

According to a report entitled “A Global Apollo Programme to Combat Climate Change,” written by a number of high-profile British scientists and economists, there is a need to generate a technological revolution. They argue that this will require rapid technological advances. Some progress is being achieved, notably the collapse in the price of photovoltaic panels. Much more have to be done, however. Publicly-funded research is under 2 percent of all publicly-funded R&D or only $6 billion, which is dwarfed by the $101 billion spent on subsidies for renewable production and the humongous $550 billion used to subsidize fossil fuel production and consumption.   As Mr. Wolf wrote: “This is a grotesque picture. Far more money needs to go to publicly funded research. The public sector has long played a vital role in funding scientific and technological breakthroughs. In this case, that role is particularly important, given the agreed goal of reducing emissions and the fact that the energy sector spends relatively little on R&D.”

These considerations bring us to the recently published Encyclical Letter of Pope Francis entitled “Laudato Si” (On Care For Our Common Home). Contrary to the views of some conservative critics, this document does not purport to settle the issue on whether or not it is human behavior that is the main cause of climate change. It is still open to the view that climate change could be in large part explained by non-human causes. It nevertheless recognizes the obvious fact that at the micro level, there are decisions by business people that do not sufficiently take into account their adverse impact on the climate.

No one can argue with this fundamentally moral assessment of the actions of some industrialists: “An assessment of the environmental impact of business ventures and projects demand the transparent political processes involving a free exchange of views. On the other hand, the forms of corruption which conceal the actual environmental impact of a given project, in exchange for favors, usually produce specious agreements which fail to inform adequately and to allow for a full debate (par. 182)…Environmental impact assessment should not come after the drawing up of a business proposition or the proposal of a particular policy, plan or program. It should be part of the process from the beginning, and be carried out in a way which is interdisciplinary, transparent and free of all economic or political pres sure.”

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