Even when new technology and models are available, the logistics of rolling them out can be daunting. The two big challenges are providing the upfront investment for energy schemes, and building and maintaining the necessary distribution systems to enable them to reach sufficient scale. At the moment, most schemes are funded by angel investors, foundations and social venture-capital funds. There is a vigorous debate about whether the private sector on its own can make these models work as technology improves, or whether non-profit groups are needed to fill the gaps in funding and distribution.
Microfinance institutions may seem the natural financial partners to help the poor pay for energy systems, since they are the only organisations with millions of poor customers. But teething problems are formidable and success stories are few, says Patrick Maloney of the Lemelson Foundation, which invests in clean-energy technologies for the poor. A telephone lady could buy a mobile phone for a relatively small sum, and would immediately have a source of income with which to repay the loan. Although a household that buys a solar lamp saves money on kerosene, the investment takes several months to pay for itself, and there is no actual income from the lamp. For bigger energy projects, such as micro-generators, the loan required is much larger, and therefore riskier, than the loan for a mobile phone.
Moreover, microfinance institutions may lack the funds to identify reliable energy suppliers, educate loan officers about clean-energy technologies and build a support network for energy schemes. One way to solve this problem, being pursued by MicroEnergy Credits, a social enterprise, is to plug microfinance institutions into carbon markets. Projects can then be funded by selling carbon credits when a microfinance customer switches from kerosene to solar lighting, for example.
Distribution is also a problem, particularly in Africa and South Asia, where the majority of the world's energy-poor live. Infrastructure and supply chains are poor or non-existent, particularly in rural areas. Recruiting and training a sales force, and educating consumers of the benefits of switching away from wood or kerosene, must be paid for somehow. Social enterprises are innovating in this area, too. Solar Aid, a non-profit group, specialises in setting up microfranchises to identify and train entrepreneurs. The organisation works with local authorities to identify potential entrepreneurs, who must gather signatures from their local community&mdashroviding both the endorsement of their neighbours and a future customer base. They then undergo five days of training with an exam at the end. Solar Aid is also testing a kiosk-based system to help entrepreneurs distribute LED lighting in the Kibera district of the Kenyan capital, Nairobi.
Some hurdles to bottom-up energy projects are more easily addressed. In particular, high import duties on clean-energy products in many developing countries, notably in Africa, hamper their adoption by the poor. Ethiopia, for example, imposes a 100% duty on imports of solar products, while Malawi charges a 47.5% tax on LED lighting systems. Such taxes are sometimes defended on the basis that only the rich can afford fancy technology. But the same was said about mobile phones a decade ago—and look at them now.
Natural gas must play a critical role in meeting our future energy needs.
As energy demand grows in Australia and across Asia, we need to make sure we are supporting the development of the gas resources that are so critical to reliably powering our homes and businesses – as well as creating economic opportunity for the nation.
Our energy needs are rising fast. Global energy demand is expected to grow by one third by 2035, with an astonishing 60% of that growth to come from our Asian neighbours. As Australia’s population grows we expect energy demand to grow at a similar rate.
The good news is that at current projections, Australia has enough known gas resources to satisfy all our domestic demand and export needs for the next 50 years. And, with increasing exploration and new technology those resources will continue to increase.
The challenge that Australia faces is that those gas resources which have been relatively cheap to develop are mostly gone. However the low hanging fruit has been picked, and our remaining gas resources are more expensive to produce.
The key to ensuring driving down cost is to develop our resources at scale, and the reality is that in Australia this requires access to an export market – such as Asia is providing today through the ability to export gas as LNG.
All of this is important to remember amid rising calls for governments to intervene in the market and force producers to reserve portions of their gas for domestic use.
Let’s call a spade a spade. The call for a reservation policy is not about the availability of gas but for a request for the gas producers to subsidise others. This is neither sensible nor the best approach to ensure either industry prospers in the long term.
Reservation, as a proxy for price control, will not promote the development of new gas resources needed to supply Australia and Asia’s needs. It is likely to stop investment and reduce supply, causing the market to tighten and prices to rise.
Let me apply this to some immediate concerns. There is no doubt that tightness in the eastern Australian gas market is on the horizon. This is not about having enough gas in the ground, particularly in New South Wales where proven reserves of natural gas are the largest uncontracted resources onshore Australia.
This is about the ability to develop those resources and supply them to the market. In recent times this ability has been hampered amid policy uncertainty and increasing environmental activism.
Without the development of NSW’s resources, Australia’s most populous state and largest gas market faces the real prospect of significant gas shortages as early as 2016. Very soon, NSW must enable supply to match its demand.
Indeed, Santos has the potential to develop significant resources in north-west NSW that can supply 25% of NSW’s gas needs, and which we are committed to delivering to NSW customers.
It is time to allow the industry to deliver the gas the market needs.
But in a sop to environment campaigners, ministers will agree to tough greenhouse gas emissions targets by 2030.
The question of a renewable energy target for 2030 – to take over from the current goal, of generating 20% of energy in the EU from renewable sources by 2020 – has been a vexed issue for government and industry. Chancellor George Osborne has opposed setting clear targets for 2030, preferring a "dash for gas" that would see 20 or more new gas-fired power stations built in the next decade. Green campaigners say that would be fatal for attempts to tackle climate change, and have called for higher ambitions on renewable energy.
Under the new proposals, to be unveiled by climate and energy secretary Ed Davey today (27 May), the UK would call on the EU to commit to carbon dioxide reductions of 40% by 2030, compared with 1990 levels, rising to 50% if other countries join in with more stringent targets on emissions. World governments are engaged in negotiations on a global climate change deal to replace the Kyoto protocol, with a new agreement to take effect by 2020. The proposals would make the UK the first country to set out its stance on emissions cuts before the next round of talks, in November.
Davey said: "The UK is a global leader in tackling climate change … That is why we will argue for an EU-wide binding emissions reductions target of 50% by 2030 in the context of an ambitious global climate deal and even a unilateral EU 40% target without a global deal.
"This 2030 target is ambitious, but it is achievable and necessary if we are to limit climate change to manageable proportions."
But the Liberal Democrats were only able to push through an emissions target by giving up on the goal for a set quota of energy to come from renewable sources by 2030. That will dismay investors in renewable power, who take the view that the current target – of generating 20% of EU energy from renewables by 2020 – has been the key force in encouraging investment in the green industry.
Many Tory MPs have opposed renewable energy, in particular opposing subsidies for onshore windfarms, preventing the coalition from pursuing new targets . Clean technology companies have warned that tens of billions of pounds of investment in new wind turbine factories and installations is hanging in the balance, because if there are no new renewable targets beyond 2020, any investments made today may soon become uneconomic.
David Kennedy, chief executive of the Committee on Climate Change, the statutory body set up to advise ministers on how to meet the UK's emissions targets, has said that the government's uncertainty over new renewable energy has unsettled investors. He said last month: "The government has committed to low-carbon support mechanisms to 2020, but they have said after that we might have a dash for gas – and this is destroying the confidence of investors, particularly in the renewables sector."
Davey said: "We want to maintain flexibility for member states in how they meet this ambitious emissions target. There are a variety of options to decarbonise any country's economy. In the UK, our approach is technology neutral and our reforms will rely on the market and competition to determine the low carbon electricity mix. We will therefore oppose a renewable energy target at an EU level as inflexible and unnecessary."
The Green Alliance, which campaigns for measures to tackle climate change, welcomed the government's stance, however. Matthew Spencer, chief executive, said: "This is very good news for anyone who thinks tackling climate security is too important to be a partisan issue. Both Ed Davey and William Hague should be recognised for their efforts in getting this agreed across government.
"They can both now play a critical role in securing a bold European climate action plan for 2030, which will make a global climate deal more likely and help accelerate the growth of the UK's sizeable green business sector. The last European 2020 climate package was central to creating breakthroughs in vehicle efficiency and renewable energy cost reduction and it wouldn't have happened without UK political leadership."
Eleven witnesses have explained how wind turbines have affected their lives while delivering testimony at the Environmental Review Tribunal (ERT). The hearings continue this week in Toronto and Demorestville.
The ERT is examining the decision to approve an industrial wind turbine project at Ostrander Point, Prince Edward County.
During March and April, ERT members Heather Gibbs and Robert Wright heard many hours of expert testimony from dozens of Prince Edward County Field Naturalists’ (PECFN) case witnesses on how nine 500-foot turbines planted in concrete bases and with wing spans of a football field will impact plants and animals and the Important Bird Area on the shoreline of South Marysburgh.
The wind development company experts countered that there will be harm but not so great as to be irreversible.
This month, the hearing changed its focus to how turbines risk human health in a case brought forward by the Alliance to Protect Prince Edward County (APPEC). Their appeal must prove serious harm to human health, though not necessarily irreversible harm.
The witnesses are current or former residents of the operating wind projects at Clear Creek, Kent-Breeze, Melancthon, Talbot, and Wolfe Island.
Most either were in favor of renewable energy, or were indifferent until wind turbines changed their lives.
The witnesses reported a variety of similar adverse symptoms – principally sleep disturbance, nausea, migraine, vertigo, cognitive impairment, high blood pressure, and cardiac events. They also report suffering from profound stress brought on by deteriorating health, community and even family divisions, severe financial loss, and abandoned, unsalable homes.
“These victims are the coincidental casualties of wind power development,” says Henri Garand, APPEC Chairman. “Despite numerous complaints to developers, municipal governments, the Ministry of Environment and two Ontario premiers, nothing has been done to relieve their situations or even acknowledge the real problems. The MOE not only has failed to enforce compliance with noise standards but has continued to approve wind power projects based on the same inadequate setback regulations.”
“The ongoing ERT appeal has now given legal recognition to the many abuses that have already occurred. Starting May 27 in Toronto, expert medical witnesses Dr. Robert McMurtry and Dr. Sarah Laurie will confirm and explain adverse health effects caused by wind turbines.
“This proof of serious harm to human health meets the requirements of the ERT in order to cancel the MOE’s approval of the Ostrander Point project,” said Garand. “It will also discredit the MOE’s regulatory process and standards for Renewable Energy Approvals. Then rural Ontarians will be protected from the consequences of unsafe wind power development.”