Global economy could save US$115 trillion with clean energy investment, renewables sector already supports 6.5 million jobs
- 13 May 2014
LONDON: A strong investment in clean energy could result in savings of US $115 trillion to the global economy far outweighing the initial spend, the International Energy Agency (IEA) has revealed.
However, delays in moving towards greater renewable energy use have already increased the cost of transition by 22% warns the IEA as fossil fuel power plants continue to be built, locking in expensive and damaging high carbon infrastructure.
The IEA’s 2014 edition of its annual Energy Technology Perspectives, (ETP 2014) report, examines trends in the energy sector and progress towards decarbonization. The report notes that that there has been a significant rise in global electricity demand, however there is also a clear need for greater system cohesion.
A key chapter of the overall ETP 2014 is the annual progress report which has found that emerging economies have played a crucial role in the growth of clean energy technology. These countries have helped to accelerate the global clean energy revolution, with their increased investment compensating for “slowing or more volatile renewable power growth in Europe and the United States”, the IEA notes.
In addition to evaluating low carbon progress over the past 12 months, the ETP 2014 focuses on three distinct warming scenarios of 2, 4 and 6 degree Celsius, to illustrate how the global energy system and electricity production could evolve between now and 2050.
To limit global warming to 2C - which is internationally recognized as the necessary cap – electricity would have to overtake oil products to become the main energy carrier. Since the 1970s, electricity’s overall share of total energy demand has increased from 9% to over 17%, but to curtail the rise in temperatures in line with the 2C objective, approximately 65% of electricity would need to come from renewable energy by 2050.
The IEA believes that natural gas can help to mitigate further warming in the short term, but is keen to stress that it is a “transitional fuel”. Unless combined with carbon capture and storage (CCS), natural gas is not a low carbon solution, the research body attest.
IEA Executive Director, Maria van der Hoeven, emphasized that greater deployment of electricity from clean energy sources would provide a boost to the global economy. “Electricity is going to play a defining role in the first half of this century as the energy carrier that increasingly powers economic growth and development,” the Director noted. The message from the IEA is unequivocal “the longer we wait, the more expensive it becomes to transform our energy system".
Maria van der Hoeven continued by acknowledging that “growing use of coal globally is overshadowing progress in renewable energy deployment” and argued that “a radical change of course at the global level is long overdue".
Damian Ryan, Senior Policy Manager, The Climate Group, said: “The ETP 2014 paints an optimistic and compelling picture of the prosperous low carbon future that is still within our hands to build. However, decision makers in both government and business need to act on this opportunity today, since the cost of inaction, as the IEA’s analysis clearly show, increases every year."
Renewable Energy: A Key Contributor to the Global Economy
Separately, the International Renewable Energy Agency (IRENA) have released a report which confirms the IEA’s research linking clean electricity to economic prosperity. The IRENA report records steady growth in the industry and notes that the alternative energy sector now supports 6.5 million jobs - with close to 1 million jobs being created in 2013 alone.
Furthermore, IRENA has previously stated that if the off-grid renewables-based electricity sector is expanded to ensure universal energy access by 2030, 4.5 million jobs could be created.
Renewable Energy and Jobs – Annual Review 2014 found that China, Brazil, the United States, India, Germany, Spain and Bangladesh are currently the leading countries for renewable energy employment. This research is in line with data released by the American Solar Foundation, which showed that 23,682 new US solar jobs were added in 2013 giving a growth rate of 19.9% on 2012's total.
Solar photovoltaic is the largest employment sector within the global renewable energy industry, according to IRENA, and the analysts estimate that there was a five-fold increase of solar PV installations in China from 2011 to 2013.
The international renewable energy analysts recognize that further job creation and economic gain is contingent on an enabling policy framework. In addition, barriers to women’s participation in the sector must be addressed if the industry is to continue to meet the growing global demand for clean electricity.
Graphs courtesy of IEA and IRENA
By Alana Ryan