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ADB Grant to Support Increased Cross-Border Energy Trading in Central Asia

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The Asian Development Bank (ADB) has approved a $4.5 million cluster regional technical assistance grant to support an increase in regional power trade in Central Asia Power System (CAPS) and explore potential reconnection of Turkmenistan to CAPS and its further expansion to Afghanistan.

“With increased regional power trade, countries will be able to meet local demand for power and supply surpluses to their neighbors,” said Director of Energy Division at ADB’s Central and West Asia Department Mr. Ashok Bhargava. He further added that this will improve regional energy security and reduce carbon footprints of meeting the regional power demand.

Power trade among Central Asian countries has declined dramatically since the collapse of the Soviet Union in 1991. First in 2003, Turkmenistan disconnected from CAPS and then in 2009, Tajikistan was disconnected from CAPS. As a result, compared to 25,413 million kilowatt hour (kWh) traded in CAPS in 1990, the traded energy volume declined to 2,080 million kWh in 2016. This had caused widespread power outages notably in Tajikistan in winter and resulted in increased fossil fuel use by Kazakhstan, Turkmenistan, and Uzbekistan in the summer mainly because hydropower surpluses from Tajikistan were not available to CAPS. Tajikistan has since reconnected to Uzbekistan and to CAPS in March 2018.

The TA cluster will include three key subprojects to introduce an energy data management (EDM) system to the Coordinating Dispatch Center (CDC) Energiya to enable a safe increase of energy flow within CAPS; update regional power sector masterplan to identify technical barriers to increased power flow and possible solutions to overcome these barriers; and expand CAPS to Afghanistan and potentially Turkmenistan and identify additional new markets to increase power trade.

“The Central Asian countries lack the institutional and technical capacity to optimally coordinate increased power trade, due to prevailing obsolete technologies and system forecast techniques that constraints real-time monitoring of new power system assets in the region and corresponding adjustments of power flows” said ADB Senior Energy Specialist Mr. Bouadokpheng Chansavat. In this regard, the CDC Energiya, which was established in 1960s to coordinate power flows in CAPS need urgent capacity development and technological upgrading.

The updating of the regional power sector master plan is timely since its completion in 2012 to take into account the newly completed power assets and evolved geopolitical situation in Central Asia.

In 2017, Afghanistan expressed interest to join CAPS as it already trades bilaterally with Tajikistan, Turkmenistan, and Uzbekistan. This technical assistance grant will help assess Afghanistan’s electricity grid and ensure compatibility with CAPS. Options for connection of Turkmenistan back to CAPS will also be explored.

The technical assistance cost is $4.5 million, $1.5 million of which will be financed by ADB on a grant basis; $1 million by the Regional Cooperation and Integration Fund; $1 million by the Asian Clean Energy Fund; and $1 million by the High-Level Technology Fund. The governments will provide counterpart support in the form of staff, office space, and supplies and other in-kind contributions.

ADB has committed $7.1 billion in loans and $85.9 million in technical assistance grants to Uzbekistan since it joined the bank in 1995. In 2018, ADB committed four loans totaling $993 million to improve power generation efficiency, improve primary healthcare services, support horticulture-related farmers and businesses for fixed asset investments, and support ongoing reforms through better economic management in the country.

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IRENA to Present Innovation Pathway to Renewable Energy Growth at G20

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The G20 group of countries, whose members represent nearly 80 per cent of global energy consumption and hold 75 per cent of global renewables deployment potential by 2030, are well positioned to lead the global energy transformation.

The group has shown a growing commitment to collaborate on climate and energy issues, and to address challenges regarding energy security and productivity, environmental protection, and economic growth underpinned by the transition to renewables.

To further support and accelerate the shift, IRENA’s Director-General Francesco La Camera will present G20 ministers with a series of innovation-led solutions to integrate higher shares of renewable energy into power systems. During its ‘Ministerial Meeting on Energy Transitions and Global Environment for Sustainable Growth’ in Karuizawa, Nagano Prefecture, Japan on June 15-16 IRENA will build on its well established position as an important contributor to the G20 decarbonisation discussion, by further championing the growing environmental and economic cases for the widespread adoption of renewable energy, a sector which now employs over 11 million people globally.

In a keynote address to the meeting’s discussion on ‘Energy Innovation and Cross-Cutting Issues – Energy Innovation / Energy Security / Energy Access and Affordability’, IRENA Director-General Francesco La Camera will highlight that the case for renewable energy has never been stronger. IRENA’s new cost data shows that by next year, onshore wind and solar PV will be a less expensive source of new electricity than the cheapest fossil fuel alternative.

The Director-General will outline to G20 ministers that renewables, together with energy efficiency, can deliver 90 per cent of energy related emissions reductions needed to keep global temperature increases well below 2° Celsius in line with the Paris Climate Agreement goals. To do so, electricity must become the dominate energy carrier Mr. La Camera will stress, highlighting that electricity must supply half of total final energy by 2050. Renewable electricity accounting for 86 per cent of that.

IRENA’s Solutions to Integrate High Shares of Variable Renewable Energy report, published and presented at the request of this year’s G20 president, highlights key action areas to scale up variable renewable energy power generation in G20 countries. Three key areas include the need for:

  • Enabling frameworks for long-term energy system planning, holistic policy-making, and co-ordinated approaches across sectors and countries.
  • Fostering systemic innovation, both in technologies, and market design, operational practices and business models.
  • Unlocking investments and strengthening partnerships with the private sector.

Increasing cooperation

In cooperation with the previous G20 presidencies of Turkey, China, Germany and Argentina during the last four years, IRENA has provided targeted analysis and recommendations for the group’s energy discussions. At the first G20 Energy Ministers Meeting in October 2015, ministers adopted the G20 Toolkit of Voluntary Options for Renewable Energy Deployment, which presented a set of voluntary options for G20 countries to accelerate the scale-up of renewable energy. IRENA was a central coordinator of the Toolkit’s implementation, in co-operation with other international organisations.

In June 2016, progress on work completed under the toolkit was reviewed with the aim to mobilise more finance, reduce costs and chart renewable potential.

In the context of Argentina’s G20 Presidency last year, IRENA was asked to elaborate opportunities for the accelerated deployment of renewables, using a systemic and holistic approach, and to present relevant lessons learnt from implementing policy and investment frameworks. Building on this work, IRENA developed an overview of Opportunities to Accelerate Energy Transitions through Enhanced Deployment of Renewables.

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11 Million People Employed in Renewable Energy Worldwide in 2018

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Eleven million people were employed in renewable energy worldwide in 2018 according to the latest analysis by the International Renewable Energy Agency (IRENA). This compares with 10.3 million in 2017 . As more and more countries manufacture, trade and install renewable energy technologies, the latest Renewable Energy and Jobs – Annual Review finds that renewables jobs grew to their highest level despite slower growth in key renewable energy markets including China.

The diversification of the renewable energy supply chain is changing the sector’s geographic footprint. Until now, renewable energy industries have remained relatively concentrated in a handful of major markets, such as China, the United States and the European Union. Increasingly, however, East and Southeast Asian countries have emerged alongside China as key exporters of solar photovoltaic (PV) panels. Countries including Malaysia, Thailand and Viet Nam were responsible for a greater share of growth in renewables jobs last year, which allowed Asia to maintain a 60 per cent share of renewable energy jobs worldwide.

“Beyond climate goals, governments are prioritising renewables as a driver of low-carbon economic growth in recognition of the numerous employment opportunities created by the transition to renewables,” said Francesco La Camera, Director-General of IRENA. “Renewables deliver on all main pillars of sustainable development – environmental, economic and social. As the global energy transformation gains momentum, this employment dimension reinforces the social aspect of sustainable development and provides yet another reason for countries to commit to renewables.”

Solar photovoltaic (PV) and wind remain the most dynamic of all renewable energy industries. Accounting for one-third of the total renewable energy workflow, solar PV retains the top spot in 2018, ahead of liquid biofuels, hydropower, and wind power. Geographically, Asia hosts over three million PV jobs, nearly nine-tenths of the global total.

Most of the wind industry’s activity still occurs on land and is responsible for the bulk of the sector’s 1.2 million jobs. China alone accounts for 44 per cent of global wind employment, followed by Germany and the United States. Offshore wind could be an especially attractive option for leveraging domestic capacity and exploiting synergies with the oil and gas industry. Renewable energy jobs highlights:

The solar PV industry retains the top spot, with a third of the total renewable energy workforce. In 2018, PV employment expanded in India, Southeast Asia and Brazil, while China, the United States, Japan and the European Union lost jobs.

Rising output pushed biofuel jobs up 6% to 2.1 million. Brazil, Colombia, and Southeast Asia have labour-intensive supply chains where informal work is prominent, whereas operations in the United States and the European Union are far more mechanised.

Employment in wind power supports 1.2 million jobs. Onshore projects predominate, but the offshore segment is gaining traction and could build on expertise and infrastructure in the offshore oil and gas sector.

Hydropower has the largest installed capacity of all renewables but is now expanding slowly. The sector employs 2.1 million people directly, three quarters of whom are in operations and maintenance.

IRENA

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World Bank to Help China Develop Renewable Energy with Battery Storage

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The World Bank’s Board of Executive Directors have approved a US$300 million loan for the China Renewable Energy and Battery Storage Promotion Project to increase the integration and utilization of renewable energy by deploying battery storage systems at scale. 

Despite having the largest installed electricity generation capacity of wind and solar power, China is unable to operate and utilize these resources fully due to technical constraints in the transmission networks and gaps in the regulatory framework for electricity trade between provinces.  This project will help address these constraints and support China’s overarching energy transition goals. These include a shift away from coal and increasing the share of non-fossil fuels in the primary energy consumption from the current 14.3% to 20% by 2030, and to over 50% by 2050.   

This project will help accelerate the on-going clean energy transition in China and contribute to the country’s emission reduction targets,” said Martin Raiser, World Bank Country Director for China. “By providing financing for battery storage and distributed renewable energy applications, the project will reduce curtailment of renewable energy capacity and thus encourage further investments into changing China’s energy mix. Parallel technical assistance will help improve the policy and regulatory framework for green energy technologies, thereby reducing risks and encouraging private investment.”

The Renewable Energy and Battery Storage Promotion Project will be implemented by Hua Xia Bank, a publicly listed commercial bank in China.  Hua Xia Bank will provide co-financing of at least $450 million to achieve the development goals of the project.  Technical assistance for policy and regulatory reforms, shaping appropriate technology and safety standards, and developing institutional capabilities will be financed by the Global Environmental Facility (GEF) and the Energy Sector Management Assistance Program (ESMAP).

“Hua Xia Bank has been a strong partner of the World Bank in expanding commercial financing for, and wider adoption of, clean energy technologies in China.  We look forward to working with them to support small and medium-enterprises to implement financially and technically well-structured battery storage projects with due regard to environmental and safety considerations,” said Peng Ximing, World Bank Senior Energy Specialist and project team leader.

This project is part of the World Bank Group’s September 2018 commitment to significantly scale up support to battery storage solutions globally through a $1 billion battery storage investment program.  The World Bank Group has just established a new international partnership – the Energy Storage Partnership (ESP) – that fosters international cooperation on battery storage solutions.  The ESP will be a platform to share lessons and experiences from China’s deployment of batteries in power systems with other developed and developing country stakeholders. 

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