Developing and emerging economies face a complex challenge when it comes to their energy infrastructure: they must meet the needs of growing populations that still lack access to basic services like water and electricity but – the climate crisis front and centre – they must also be part of the solution by answering the global climate emergency through innovative efforts to ensure a low-carbon future.
The Paris Agreement, which will officially enter into force in 2020, asks that each country contribute to mitigating and adapting to climate change. Setting it in motion requires collaborative efforts in the field of social, technological and financial innovations as well as the strong commercial development and application of solutions. In this regards, Sustainable Development Goal 7 (SDG 7) aims to ensure access to affordable, reliable, sustainable and modern energy for all, and while the number of people without access to electricity fell to below 1 billion in 2017, there is still a long way to go.
In September 2019, UN Secretary-General António Guterres convened the Climate Action Summit to mobilise political leaders, economic actors, and climate activists around the implementation of the Paris Agreement. With only ten years left to achieve the SDGs, and national governments offering less-than-inspiring solutions to a global crisis, Friends of Europe has brought together some of the key actors from the private sector, think tanks, development agencies, and supranational organisations, to highlight some of the stories of progress on the provision of clean sources of electricity, and the effect it has had on living conditions in a number of economies.
Articles in this discussion paper are published online on a weekly basis, beginning on the day of the United Nations Secretary-General Summit on Climate Action and ending at the time of COP 25 in Santiago. The articles, and the recommendations from the publication, aim to demonstrate that it is possible to achieve SDG 7 well before 2030, and inform the next EU mandate on actions to take. The European Green Deal has a duty to go beyond Europe, and help nations around the world to transition towards sustainable economic and energy growth.
We need climate action now. But how can we do this in a fair way that benefits all communities, nations and businesses alike? How do we address all 17 of the Sustainable Development Goals (SDGs) while creating meaningful solutions to climate change? How can this lead to effective implementation?
These are not just questions for the United Nations Office for Project Services (UNOPS) to address. These are the questions that everyone on this planet must find answers to. Of course, the simple answer is ‘change’. We must change how we live our lives, how we move around, how we power our machines, how we heat our homes and how we cook our food.
While there are many contributors to climate change, one of the most prevalent is how we generate and use energy. Even in 2019, despite all of our technological advances, we remain far too reliant on fossil fuels to generate electricity.
This reliance is inexorably tied to the continuing growth in energy demands. The global population is growing and the number of machines and devices which need energy is increasing every day. In this modern age, access to energy is now nearly as important as access to food and water.
Today, the number of people without access to power has dropped below 1bn. With global commitments to the completion of SDG7 – ensuring access to affordable, reliable, sustainable and modern energy for all – it is reassuring to see this number moving in the right direction. However, there is still plenty more work to be done.
2019 has also seen citizens organising and participating in mass marches for climate action the world over
Cities are considered to be the world’s engines for economic growth. Unfortunately, a lot of energy is required to power these engines. On average, cities consume about two-thirds of the world’s energy, emitting more than 70% of global CO2 emissions.
These bustling centres of economic activity are rapidly growing. A recent UN report estimated that by 2050 an extra 2.5bn people will live in urban areas – the majority of them in Africa and Asia. This trend will be accompanied by a much greater demand for energy, and the monumental task of delivering that access while reducing greenhouse emissions. It is easy to commit to ‘change’, but is much harder to implement.
But change isn’t only on UNOPS’ agenda. Now, more than ever, people across the world are demanding it too. Recent elections in Europe saw political parties focused on climate-related issues significantly increase their vote share. In Denmark, home to UNOPS’ headquarters, the environment was a key focus in debates.
Outside of formal politics, 2019 has also seen citizens organising and participating in mass marches for climate action the world over. The most famous examples have been the weekly school strikes for climate initiated by the young Swedish activist Greta Thunberg. To date, more than 1mn school students have skipped a day of school to demand stronger action on climate.
With the public clamouring for climate action, governments at all levels and international organisations must leverage this demand to increase their efforts. UNOPS has seized the initiative by helping governments, the UN and its partners implement around 1,000 projects, worth approximately $2bn, in more than 80 nations across the world every year.
The solution was to work with partners to redevelop the plant’s business model and help generate new investment in the facility
As infrastructure specialists, improving access to sustainable and renewable energy is one of the areas in which UNOPS works. In Sierra Leone, for instance, this UN body has spent the last three years developing a renewable energy system in the country’s most remote and rural areas. Funded by the British government, this project provides clean energy to hospitals and schools using a mini-grid system that harnesses solar energy.
On the day the lights were switched on in one local school, pupils and teachers stayed in class long into the night. They had never had the opportunity to do so before the grid’s installation. Soon, electricity access will be extended to private households. Communities across Sierra Leone will be able to cook, heat their homes and light up their rooms with clean, renewable energy at a fair and controlled price. This new energy source will change lives for the better and provide new opportunities well into the future.
In Mexico, UNOPS stepped further into the renewables sector as it undertook the revitalisation of a struggling wind farm near Monterrey. The facility had been operating 8 turbines, producing 22 megawatts of renewable energy, for 5 years. For various reasons, the project was in danger of closing down, putting people’s jobs at risk and potentially forcing local residents to shoulder increased energy cost. Losing such an important source of green energy would have had a negative environmental impact, leaving the population even worse off.
The solution was to work with partners to redevelop the plant’s business model and help generate new investment in the facility. In a landmark move, this included UNOPS investing some of its own financial reserves into the project, via its Social Impact Investing Initiative.
Since then, the wind farm has recovered and is now in a healthy financial position. So much so that an expansion into solar energy is now being planned on the same site. This environmental benefit is clear: it has kept a wind farm going that otherwise faced closure. It was also beneficial for the local municipalities that now pay less for energy. The site now operates as a free learning centre for school children, who travel from all over Mexico to learn about the benefits of renewable energy.
Today, it’s understood that around 80% of the $7tn needed to achieve the SDGs will have to come from private sources
Investing in a project like this is just one example of the value of such cooperation. Private-public partnerships clearly help unleash more resources, knowledge and expertise in development projects. This is how we can ensure the success of the SDGs.
To implement the SDGs, the world needs investments in the order of $7tn globally, every year. At the moment, official development assistance (ODA) generates a mere $153bn annually for the cause. This amount did not increase between 2017 and 2018.
Today, it’s understood that around 80% of the $7tn needed to achieve the SDGs will have to come from private sources. This is how we can instigate change. It is up to all of us – from policymakers to profit creators – to work together while investing both our time and our money to tackle this issue together.
New sources of investment into sustainable development will help close this gap. There are risks that come with committing to these projects, especially in emerging economies. However, if that risk is shared, those barriers that prevented the private sector from investing in the past will be broken down. Private firms should be invited to help create a better world and be entitled to compensation, as it is inevitably for the greater good. This is what social impact investing is all about.
We need to change as a society. We need to rethink how we generate and use energy. We need to work together to make the changes needed to achieve it. We need to engage important private sector partners in this imperative effort. We need to get started now. The journey will be difficult, but we will pay an even greater price if we do not move quickly.