Recovery Money Spent On Fossils Is Twice As Much As Has Been Spent On Renewable Energy
While delivering the 19th Darbari Seth Memorial Lecture this year on “The Rise of Renewables: Shining a Light on A Sustainable Future,” the UN Secretary-General Antonio Guterres made a worrisome remark.
He said that as per recent research on G20 recovery packages, twice as much recovery money has been spent on fossil fuels as clean energy.
The International Institute for Sustainable Development recently reported on the spending of public money on energy-specific areas. As per the analysis, between the beginning of the COVID-19 pandemic in early 2020 and July 3, 2020, G20 countries have committed at least $135 billion to fossil fuels and at least $68 billion to clean energy in their stimulus and recovery packages. Another $26 billion could not be categorized.
The annual lecture series was initiated by The Energy and Resources Institute (TERI) in 2002 in the memory of the institute’s visionary founder and noted technocrat-industrialist, Darbari Seth. Past speakers to have delivered the memorial lecture include N R Narayana Murthy, Anand Mahindra, Mukesh Ambani, and Kiran Mazumdar-Shaw, among other eminent stalwarts.
Particularly in the case of India, he observed that subsidies for fossil fuels are still some seven times more than subsidies for clean energy.
The UN Chief praised the work done by India in increasing both clean energy and energy access, but highlighted the need to do more.
Talking about poverty alleviation and universal energy access as India’s top two priorities, he said clean energy, particularly solar, could be a ‘recipe’ to solve both.
Investments in renewable energy generate three times more jobs than investments in polluting fossil fuels. Since 2015, the number of people working in renewable energy in India has increased five-fold.
Last year, for the first time, India’s spending on solar energy surpassed spending on coal-fired power generation.
Guterres remarked that the “continued support for fossil fuels in so many places around the world” is deeply troubling.
I have asked all G20 countries, including India, to invest in a clean, green transition as they recover from the COVID-19 pandemic. This means ending fossil fuel subsidies, placing a price on carbon pollution, and committing to no new coal after 2020.
In their domestic stimulus and investment plans in response to COVID-19, countries such as the Republic of Korea, the United Kingdom, and Germany, as well as the European Union, are speeding up the decarbonization of their economies.
They are shifting from unsustainable fossil fuels to clean and efficient renewables and investing in energy storage solutions, such as green hydrogen.
– Antonio Guterres, UN Secretary-General
The UN Chief got a bit poetic focusing on the need to accelerate the shift from the current dependence on coal. Saying that the coal business is “going up in smoke,” the “writing on the wall” is clear as the world’s largest investors are increasingly abandoning coal.
Probably referring to India, he said, “In some cases, we are seeing countries doubling down on domestic coal and opening up coal auctions.”
India’s Power and Renewable Energy Minister R K Singh recently remarked, “If you tell me to shut down coal based-plants tomorrow, I will not do it because it is important for me to raise standards of our people,” at The Economic Times Global Business Summit.
To reiterate, new renewable energy is now cheaper than new coal plants virtually everywhere. This is EVEN BEFORE considering coal’s dire health, climate, and environmental impacts.
Some time ago, Rocky Mountain Institute, the Carbon Tracker Initiative, and the Sierra Club released a study of nearly 2,500 coal plants globally with a cheeky title, “How to Retire Early: Making Accelerated Coal Phaseout Feasible and Just.”
As per the report, 39% of the world’s existing coal plants are ALREADY uncompetitive compared to building new renewable energy plants.
The share of uncompetitive coal plants worldwide is projected to increase rapidly to 60% in 2022 and to 73% in 2025!
In India alone, 50% of coal is forecast to become uncompetitive in 2022, reaching 85% by 2025. It is a no-brainer that pumping new money to create stranded assets makes no business sense.
Guterres also elaborated on the nexus between pollution, COVID, and climate change. On the current COVID crisis he talked about the research findings that air pollution is closely linked with the areas suffering from the pandemic.
He felt that even in the long term, the continued “strategy” of funding fossil fuels would only lead to further economic contraction and damaging health consequences.
Referring to the Intergovernmental Panel on Climate Change special report on the 1.5-degree goal of the Paris Agreement, he emphasized that climate change would hit the most vulnerable hardest.
Mincing no words in spelling out the impending doom, he said, “if this temperature limit is breached, India will face the brunt of the climate crisis.”
“Leadership Group for Industry Transition“ (LeadIT), an initiative led by India and Sweden and supported by the World Economic Forum, Energy Transitions Commission, Mission Innovation, among others, also found a mention in the UN Chief’s speech.
LeadIT was launched by the prime ministers of India and Sweden during the UN Secretary General’s Climate Action Summit on the 23rd of September 2019, in New York.
This partnership of key public and private sector stakeholders is committed to achieving net-zero emissions by mid-century in sectors that collectively account for 30% of global emissions.
Indian corporations that are currently members of the platform include Dalmia Cement, the Mahindra Group, and SpiceJet.
Guterres stressed that countries should include climate risks in decision-making as they rescue, rebuild, and reset their economies.
Towards the end of his thoughtful speech, the UN Secretary-General shared a 6-point action list for governments which are “mobilizing trillions of dollars” to fund the post-COVID recovery,
- Invest in green jobs.
- Do not bail out polluting industries.
- End fossil-fuel subsidies.
- Take climate risks into account in all financial and policy decisions.
- Work together.
- Most important, leave no one behind.
Applauding India’s decision to take forward the International Solar Alliance in the form of “One Sun, One World, One Grid,” he expressed hope that the country’s plans for a World Solar Bank will be able to mobilize $1 trillion of investments in solar projects over the coming decade.
Talking about India’s current solar base of 37 gigawatts (GW) of installed solar electricity, he said “this is only the beginning.”
The Indian government has recently raised its target of renewable energy capacity deployment from the initial 2022 goal of 175 GW to 500 GW by 2030.
Guterres also called on the innovators, entrepreneurs, and business leaders in India to spearhead the global search for a solution to solar cooking at the household level.
The UN Secretary-General urged “all countries, especially the G20, to commit to carbon neutrality before 2050 and to submit — well before COP26 — more ambitious nationally determined contributions and long-term strategies that are aligned with the 1.5-degree goal.”
It is difficult to imagine the inertia (call it old habits) which is leading governments to literally burn their money in the fossils sector — which by the way, has been hit pretty bad due to COVID.