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Renewable Energy Has High Hurdles for Europe and the U.S. to Overcome

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The future for renewables (mainly, solar and wind) shows growth, and wide-scale public, and private acceptance, but it comes with a price. What renewables have accomplished however, is truly mesmerizing.

Harnessing solar power coming from the Sahara Desert, hydroelectric power from the Hoover Dam in the United States (US), and Wind Power off the coast of England are wonderful achievements. This one time, niche electricity sector, is here to stay.

In 2016 “Renewables received 94 times more in U.S. federal subsidies than nuclear and 46 times more than fossil fuels per unit of energy generated.” In 2017, renewables provided the US roughly:

“11% of total U.S. electricity consumption. About 57% of U.S. renewable electricity consumption was by the electrical power sector, and about 17% of U.S. electricity generation was from renewable electricity sources.”

Renewables also:

“More than doubled from 2000 to 2017, mainly because of state and federal government requirements and incentives to use renewable electricity. The U.S. Energy Information Administration projects that U.S. renewable electricity consumption will continue to increase through 2050.”

All encouraging numbers, however, renewables are having a hard time lowering costs and emissions over their intermittent nature. Renewables also require enormous amounts of land, raw materials, “and many of their most critical materials are extracted and processed using child labor and near-slave wages for adults.”

Currently, we are told that solar panels and wind turbines are cheap to build and easy to deploy, while being the same cost as fossil fuels; yet they cause electricity prices to rise.

Renewables require smart electrical grids that can move electricity simultaneously between cities, countries, states, and continents. That form of electrical grid hasn’t been invented yet. Renewables have additional problems since they cannot handle powering millions of electric vehicles from an electrical grid that only relies on solar, wind and hydroelectric.

Additionally, renewables need coal-fired, natural gas, or nuclear power plants backing them up continuously, because of their intermittent nature. New transmission lines also need to be installed, otherwise electrical prices dramatically increase.

The United States and states such as Arkansas embraced solar and wind, but found that:

“For 18,000 megawatt of nuclear electricity it takes 1,100 acres of land that equals 1.7 square miles, for 1,800 megawatt of wind power it takes 108,000 acres of land that equals 169 square miles, and for 1,800 megawatt of solar power it takes 13,320 acres of land that equals 21 square miles.

Professor Mark Jacobson from the Stanford engineering department outlined what it would take for the U.S. to achieve clean, renewable and zero-emission electricity sources. The plan was found to have multiple faults that will be difficult to overcome under current technological constraints. This 2015 plan for the US would:

“Involve installing 335,000 onshore wind turbines; 154,000 offshore wind turbines; 75 million residential photovoltaic systems; 2.75 million commercial photovoltaic systems; 46,000 utility-scale photovoltaic facilities; 3,600 concentrated solar power facilities with onsite heat storage; and an extensive array of underground thermal storage facilities.”

To achieve those figures it would take an area roughly 500,000 kilometers larger than California. Renewable wind power has a large onshore and offshore footprint. This land and sea footprint breaks down, “to about 3 watts per square meter,” according to the U.S. Department of Energy.

The US’ largest state, California, would need 124.6 billion watts of onshore wind capacity, and set aside, “41.5 billion square meters or about 16,023 square miles of turbines.” Los Angeles is a little more than 4,000 square miles, so California would need to cover a land area four times larger than Los Angeles County (the largest county by population in the US) with wind turbines. Gaining approval to build wind and solar farms is facing environmental resistance.

The Los County Board of Supervisors, in 2015, voted unanimously to ban large wind turbines in unincorporated areas of LA County. The head of the California Wind Energy Association told the San Diego Union-Tribune in 2017, “We’re facing restrictions like that all around the state…It’s pretty bleak in terms of the potential for new development.” California now has approximately 5,632 of megawatts installed wind capacity, 153 megawatts less than in 2013.

Once popular wind projects like the 468-megawatt Massachusetts Cape Wind Project – met fierce opposition that scuttled the project – over locating dozens of turbines offshore. Affected groups are rallying against renewables once home values are lowered, and environmentally sensitive areas and coastlines are overwhelmed by land use requirements for renewables to be effective. 

According to scholar Lion Hirth, “Solar’s value drops by 50 when it arrives at 15 percent of the electrical mix.”But solar installations in the US are expected to grow 25 percent, according to Solar Energy Industries Association and Wood Mackenzie.

In Spotsylvania County, Virginia, which lies about halfway between Washington, DC and Richmond, Utah-based, Sustainable Power Group known, as sPower wants:

“To construct the largest solar complex east of the Mississippi River and the fifth-largest solar facility in the nation. SPower plans to install nearly 2 million solar panels on 3,500 acres of land, or about 5 ½ square miles. The project will encompass 6,350 acres.”

Difficulty overcoming the land needed for the project and communities of Spotsylvania County, Virginia was a sticking point, but they also:

“Found out these unsightly monstrosities destroy vegetation and wildlife, pollute rivers, streams and groundwater, and lead to higher electricity prices and lower property values for nearby residents.”

While trying to understand if the project is even “green,” is then realizing thousands of acres of trees were cleared to make way for solar panels.

Europeans are also pushing back against renewables by slashing government subsidies, causing uncertainty in the market. Twelve EU countries, “failed to install a single wind turbine,” in 2018, and manufacturing for wind turbines is declining. Renewable energy jobs in Britain have declined one-third since subsidies were cut, and solar panels sales sunk 94 percent after government cutbacks.

Germans are growing skeptical over renewables after their emissions have risen “10 times higher than nuclear powered France,” their electrical grid is possibly collapsing, and they have spent between $560 billion to $1 trillion US dollars for these results.

With subsidies in free fall, European countries like Germany are building new coal-fired power plants, and refurbishing older, existing ones to meet energy and electrical needs.

Renewable energy to electricity is intermittent, dilute and needs fossil fuel or nuclear power plants as a backstop. For the clean energy transition to work all parties involved need to push away from the price-per-kilowatt hour model, and move to one based on guaranteeing electricity; the same way much of the phone and internet sector is monetized, regulated and delivered.

For U.S. and European governments or private companies having large financial stakes in renewables for the projects to be successful here is what needs to happen: great public relations, reliable taxpayer subsidies, and possible eminent domain being implemented to move projects forward.

Todd Royal, MPP, is a geopolitical energy consultant and author based in Los Angeles, California. Todd has written for National Interest, OilPrice.com, EurasiaReview.com and had his works picked up Yahoo Finance, USA Today and Business Insider. His upcoming book, "Energy Made Easy," will be released this summer. Todd can be reached on Twitter @TCR_Consulting

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Energy transition is a global challenge that needs an urgent global response

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COP26 showed that green energy is not yet appealing enough for the world to reach a consensus on coal phase-out. The priority now should be creating affordable and viable alternatives 

Many were hoping that COP26 would be the moment the world agreed to phase out coal. Instead, we received a much-needed reality check when the pledge to “phase out” coal was weakened to “phase down”. 

 This change was reportedly pushed by India and China whose economies are still largely reliant on coal. The decision proved that the world is not yet ready to live without the most polluting fossil fuels. 

 This is an enormous problem. Coal is the planet’s largest source of carbon dioxide emissions, but also a major source of energy, producing over one-third of global electricity generation. Furthermore, global coal-fired electricity generation could reach an all-time high in 2022, according to the International Energy Agency (IEA).

 Given the continued demand for coal, especially in the emerging markets, we need to accelerate the use of alternative energy sources, but also ensure their equal distribution around the world.

 There are a number of steps policymakers and business leaders are taking to tackle this challenge, but all of them need to be accelerated if we are to incentivise as rapid shift away from coal as the world needs. 

 The first action to be stepped up is public and private investment in renewable energy. This investment can help on three fronts: improve efficiency and increase output of existing technologies, and help develop new technologies. For green alternatives to coal to become more economically viable, especially, for poorer countries, we need more supply and lower costs.

 There are some reasons to be hopeful. During COP26 more than 450 firms representing a ground-breaking $130 trillion of assets pledged investment to meet the goals set out in the Paris climate agreement. 

 The benefits of existing investment are also becoming clearer. Global hydrogen initiatives, for example, are accelerating rapidly, and if investment is kept up, the Hydrogen Council expects it to become a competitive low-carbon solution in long haul trucking, shipping, and steel production.

 However, the challenge remains enormous. The IEA warned in October 2021 that investment in renewable energy needs to triple by the end of this decade to effectively combat climate change. Momentum must be kept up.

 This is especially important for countries like India where coal is arguably the main driver for the country’s economic growth and supports “as many as 10-15 million people … through ancillary employment and social programs near the mines”, according to Brookings Institute.  

This leads us to the second step which must be accelerated: support for developing countries to incentivise energy transition in a way which does not compromise their growth. 

Again, there is activity on this front, but it is insufficient. Twelve years ago, richer countries pledged to channel US$100 billion a year to less wealthy nations by 2020, to help them adapt to climate change. 

The Organization for Economic Cooperation and Development estimates that the financial assistance failed to reach $80 billion in 2019, and likely fell substantially short in 2020. Governments say they will reach the promised amount by 2023. If anything, they should aim to reach it sooner.

There are huge structural costs in adapting electricity grids to be powered at a large scale by renewable energy rather than fossil fuels. Businesses will also need to adapt and millions of employees across the world will need to be re-skilled. To incentivise making these difficult but necessary changes, developing countries should be provided with the financial support promised them over a decade ago.

The third step to be developed further is regulation. Only governments are in a position to pass legislation which encourages a faster energy transition. To take just one example, the European Commission’s Green Deal, proposes introduction of new CO2 emission performance standards for cars and vans, incentivising the electrification of vehicles. 

This kind of simple, direct legislation can reduce consumption of fossil fuels and encourage industry to tackle climate change.

Widespread legislative change won’t be straightforward. Governments should closely involve industry in the consultative process to ensure changes drive innovation rather than add unnecessary bureaucracy, which has already delayed development of renewable assets in countries including Germany and Italy. Still, regardless of the challenges, stronger regulation will be key to turning corporate and sovereign pledges into concrete achievements. 

COP26 showed that we are not ready as a globe to phase out coal. The priority for the global leaders must now be to do everything they can to drive the shift towards green energy and reach the global consensus needed to save our planet.

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Pakistan–Russia Gas Stream: Opportunities and Risks of New Flagship Energy Project

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source: twitter

Russia’s Yekaterinburg hosted the 7th meeting of the Russian-Pakistani Intergovernmental Commission on Trade, Economic, Scientific and Technical Cooperation on November 24–26, 2021. Chaired by Omar Ayub Khan, Pakistan’s Minister for Economic Affairs, and Nikolai Shulginov, Russia’s Minister of Energy, the meeting was attended by around 70 policy makers, heads of key industrial companies and businessmen from both sides, marking a significant change in the bilateral relations between Moscow and Islamabad.

Three pillars of bilateral relations

Among the most important questions raised by the Commission were collaboration in trade, investment and the energy sector.

According to the Russian Federal Customs Service, the Russian-Pakistani trade turnover increased in 2020 by 45.8% compared to 2019, totaling 789.8 million U.S. dollars. Yet, there is still huge potential for increasing the trade volume for the two countries, including textiles and agricultural products of Pakistan and Russian products of machinery, technical expertise as well as transfer of knowledge and R&D.

Another prospective project discussed at the intergovernmental level is initiating a common trade corridor between Russia, the Central Asia and Pakistan. Based on the One-Belt-One-Road concept, launched by China, the Pakistan Road project is supposed to create a free flow of goods between Russia and Pakistan through building necessary economic and transport infrastructure, including railway construction and special customs conditions. During the Commission meeting, both countries expressed their intention to collaborate on renewal of the railway machines fleet and facilities in Pakistan, including supplies of mechanized track maintenance and renewal machines; supplies of 50 shunting (2400HP or less) and 100 mainline (over 3000HP) diesel locomotives; joint R&D of the technical and economic feasibility of locomotives production based in the Locomotive Factory Risalpur and other. The proposed contractors of the project might be the Russian Sinara Transport Machines, Uralvagonzavod JSC that stand ready to supply Pakistan Railway with freight wagons, locomotives and passenger coaches. In order to engage import and export activities between Russian and Pakistani businessmen, the Federation of Pakistan Chamber of Commerce signed a memorandum with Ural Chamber of Commerce and Industry, marking a new step in bilateral relations. Similar memorandums have already been signed with other Chambers of Commerce in Russian regions.

— Today, the ties between Russia and Pakistan are objectively strengthening in all areas including economic, political and military collaboration. But we, as businessmen, are primarily interested in the development of trade relations and new transit corridors for export-import activities. For example, the prospective pathways of the Pakistan-Central Asia-Russia trade and economic corridor project are now being actively discussed at the intergovernmental level, — said Mohsin Sheikh, Director of the Pakistan Russia Business Council of the Federation of Pakistan Chambers of Commerce and Industry. — For Islamabad, this issue is one of the most important. Based on a similar experience of trade with China, we see great prospects for this direction. That is why representatives of Pakistan’s government, customs officers, diplomats and businessmen gathered in Yekaterinburg today.

However, the flagship project of the new era of the Pakistan-Russia relations is likely to be the Pakistan Gas Stream. Previously known as the North-South Gas Pipeline, this mega-project (1,100 kilometers in length) is expected to cost up to USD 2,5 billion and is claimed to be highly beneficial for Pakistan. Being a net importer of energy, Pakistan will be able to develop and integrate new sources of natural gas and transport it to the densely populated industrialized north. At the same time, the project will enable Pakistan—whose main industries are still dependent on the coal consumption—to take a major step forward gradually replacing coal with relatively more ecologically sustainable natural gas. To enable this significant development in the Pakistan’s energy sector, Moscow and Islamabad have made preliminary agreements to carry on the research of Pakistan’s mineral resource sector including copper, gold, iron, lead and zinc ores of Baluchistan, Khyber Pukhtunkhwa and Punjab Provinces.

A lot opportunities but a lot more risks?

The Pakistan Stream Gas Pipe Project undoubtedly opens major investment opportunities for Pakistan. Among them are establishment of new refineries; the launch of virtual LNG pipelines; building of LNG onshore storages of LNG; investing in strategic oil and gas storages. Yet, it seems that Pakistan is likely to win more from the Project than Russia. And here’s why. The current version of the agreement signed by Moscow and Islamabad has been essentially reworked. According to it, Russia will likely to receive only 26 percent in the project stake instead of 85 percent as it was previously planned, while the Pakistani side will retain a controlling stake (74 percent) in the project.

Another stranding factor for Russia is although Moscow will be entitled to provide all the necessary facilities and equipment for the building of the pipeline, the entire construction process will be supervised by an independent Pakistani-based company, which will substantially boost Pakistan’s influence at each development. Finally, the vast bulk of the gas transported via the pipeline will likely come from Qatar, which will further strengthen Qatar’s role in the Pakistani energy sector.

Big strategy but safety first

The Pakistan Stream Gas Pipeline will surely become an important strategic tool for Russia to reactivate the South Asian vector of its foreign policy. Even though the project’s aim is not to gain a fast investment return and economic benefits, it follows significant strategic goals for both countries. As Russia-India political and economic relations are cooling down, Moscow is likely to boost ties with Pakistan, including cooperation in economy, military, safety and potentially nuclear energy, that was highlighted by Russian Foreign Minister Sergey Lavrov during visit to Islamabad earlier this year. Such an expansion of relations with Pakistan will allow Russia to gain a more solid foothold in the South Asian part of China’s BRI, thus opening up a range of new lucrative opportunities for Moscow.

Apart from its economic and political aspects, the Pakistan Stream Project also has clear geopolitical implications. It marks Russia’s growing influence in South Asia and points to some remarkable transformations that are currently taking place in this region. The ongoing geopolitical game within the India-Russia-Pakistan triangle is yet less favorable for New Delhi much because of the Pakistan Stream Project. Even though the project is not directly aimed to jeopardize the India’s role in the region, it is considered the first dangerous signal for New Delhi. For instance, the International “Extended troika” Conference on Afghanistan, which was held in Moscow last spring united representatives from the United States, Russia, China and Pakistan but left India aside (even though the latter has important strategic interests in Afghanistan).

With the recent withdrawal of the U.S. military forces from Afghanistan, Moscow has become literally the only warden of Central Asia’s security. As Russia is worried about the possibility of Islamist militants infiltrating the Central Asia, the main defensive buffer in the South for Moscow, the recent decision of Vladimir Putin to equip its military base in Tajikistan, which neighbors Afghanistan, seems to be just on time. Obviously, Islamabad that faces major risks amidst the Afghanistan crisis sees Moscow as a prospective strategic partner who will help Imran Khan strengthen the Pakistani efforts in fighting the terrorism threat.

From our partner RIAC

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Energy

How wind power is transforming communities in Viet Nam

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In two provinces of Viet Nam, a quiet transformation is taking place, driven by the power of renewable energy.

Thien Nghiep Commune, a few hundred kilometres from Ho Chi Min City, is a community of just over 6,000 people – where for years, people relied largely on farming, fishing and seasonal labour to make ends meet.

Now, thanks to a wind farm backed by the Seed Capital Assistance Facility (SCAF) – a multi-donor trust fund, led by the United Nations Environment Programme (UNEP) – people in the Thien Nghiep Commune are accessing new jobs, infrastructure and – soon – cheap, clean energy. The 40MW Dai Phong project, one of two wind farms run by SCAF partner company the Blue Circle, has brought new hope to the community.

For the 759 million people in the world who lack access to electricity, the introduction of clean energy solutions can bring improved healthcare, better education and affordable broadband, creating new jobs, livelihoods and sustainable economic value to reduce poverty.

“It’s not only about the technology and the big spinning wheel for me. It’s more about making investment decisions for the planet and at the same time not compromising on the necessity that we call electricity,” said Nguyen Thi Hoai Thuong, who works as a community liaison. “The interesting part is I work for the project, but I actually work for the community and with the community.”

While the wind farm is not yet online, a focus on local hiring and paying fair prices for land has already made a big difference to the community.

“I used the money from the land sale to the Dai Phong project to repair my house and invest in my cattle. Currently, my life is stable and I have not encountered any difficulties since selling the land,” said Ms. Le Thi Doan.

Powering change

The energy sector accounts for approximately 75 per cent of total global greenhouse gas emissions (GHGs). UNEP research shows that these need to be reduced dramatically and eventually eliminated to meet the goals of the Paris Agreement.

Renewable energy, in all its forms, is one of humanity’s greatest assets in the fight to limit climate change. Capacity across the globe continues to grow every year, lowering both GHGs and air pollution, but the pace of action must accelerate to hold global temperature rise to 1.5 °C this century.

“To boost growth in renewables, however, companies need to access finance,” said Rakesh  Shejwal, a Programme Management Officer at SCAF. “This is where SCAF comes in. SCAF works through private equity funds and development companies to mobilize early-stage investment low-carbon projects in developing countries.”

The 176 projects it seed financed have mobilized US $3.47 billion to build over one gigawatt of generation capacity, avoiding emissions of 4.68 million tons of carbon dioxide (CO2) equivalent each year.

But SCAF’s work isn’t just about cutting emissions. It is bringing huge benefits across the sustainable development agenda: increasing access to clean and reliable electricity and boosting communities across Asia and Africa. SCAF will be potentially creating 17,000 jobs.

This is evident in Ninh Thuan province, where the Blue Circle created both the first commercial wind power project and the first to be commissioned by a foreign private investor in Viet Nam.

Here, the Dam Nai wind farm has delivered fifteen 2.625 MW turbines, the largest in the country at the time. These will generate approximately 100 GWh per year. They will avoid over 68,000 tCO2e annually and create more than an estimated 302 temporary construction and 13 permanent operation and maintenance jobs for the local community.

Students from the local high school in Ninh Thuan Province were also given the opportunity to meet with engineers and technicians on the project, increasing their knowledge about how renewable energy works and opening up new career paths.

SCAF, through its partners, is supporting clean energy project development in the Southeast Asian region and African region. SCAF has more than a decade of experience in decarbonization and is currently poised to run till 2026.

UNEP

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