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Bangladesh Receives $185 Million World Bank Financing for Renewable Energy

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The government of Bangladesh today signed a $185 million financing agreement with the World Bank to add about 310 MW renewable energy generation capacity, which will contribute to reliable, affordable electricity and cleaner air.

The Scaling-up Renewable Energy Project will focus on utility scale solar photovoltaic (PV) and rooftop PV to expand new markets in renewable energy generation it the country. The project will establish the country’s first large-scale 50MW grid-tied solar PV generation plant in Feni district, implemented by the Electricity Generation Company of Bangladesh (EGCB). To fill the gap in the long-term domestic financing market for renewable energy, the project will also support the Infrastructure Development Corporation Limited (IDCOL) to manage a Renewable Energy Financing Facility for both rooftop and utility scale solar PV. It will also help Sustainable and Renewable Energy Development Authority (SREDA) identify sites for large-scale projects and promote new net metering policy for rooftop PV.

Since the last decade, the World Bank has helped Bangladesh increase access to electricity in rural areas through renewable energy. Today, Bangladesh has one of the world’s largest domestic solar power program that serves about one-tenth of the country’s population,” said Dandan Chen, Acting Country Director for Bangladesh and Bhutan. “Now, we are going one step further to help Bangladesh expand renewable energy generation on a larger scale. With strong collaboration between the public and private sector, we hope the project will help meet the growing energy demands of the population.”

The project will help unlock private investment and will aim to raise up to $212 million in financing from the private sector, commercial banks, and other sources.

“The project will be important for Bangladesh to tap into its potential for renewable energy generation. Further, it will help reduce a substantive amount of CO2 emissions per year, which is in line with the country’s nationally determined contribution to the Paris climate agreement,” said Monowar Ahmed, Secretary, Economic Relations Division, Government of Bangladesh.

The $185 million credit also includes a $26.38 million loan and a $2.87 million grant from the Strategic Climate Fund (SCF) of the World Bank’s Climate Investment Funds (CIFs). The credit from the World Bank’s International Development Association (IDA), has a 30-year term, including a five-year grace period, and an interest rate of 1.25 percent with a service charge of 0.75 percent. The SCF loan has a maturity of 40 years, including a grace period of 10 years with a service charge of 0.1%.

The World Bank was among the first development partners to support Bangladesh following its independence. Since then the World Bank has committed more than $30 billion in grants, interest-free and concessional credits to Bangladesh.With this project, the Bank’s ongoing support in the energy sector totals close to $2.4 billion, covering generation, transmission, and distribution, including renewable energy.

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Latin America and Caribbean on the Brink of Massive Solar Power Growth

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Latin America and the Caribbean could grow their installed solar capacity by a factor of 40 by 2050, a new report by the International Renewable Energy Agency (IRENA) shows. Annual investmens exceeding seven billion would see the region’s solar PV capacity rise from 7 gigawatts (GW) today, to more than 280 GW by mid-century. While solar energy remains the highest in Asia, North America and Europe, market growth is set to shift to other regions in the world.

By that time, solar PV would represent the second-largest power source behind wind, generating a quarter of the world’s power, “Future of Solar Photovoltaic” launched today at “Sun World 2019” in Lima finds. In total, global solar power capacity would rise from 480 GW in 2018 to over 8000 GW by 2050, growing by nearly 9 per cent every year.

“Solar PV and other renewables sources represent the most effective and ready solution for addressing growing energy demand and limiting carbon emission at the same time,” said IRENA’s Director-General Francesco La Camera. “Renewables are practical, affordable and climate-safe. They are key to sustainable development, enabling energy access, spurring economic growth, creating employment and improving health. Particularly solar energy is set to become one of the most prominent power sources in 2050. Projected growth rates in markets like Latin America showcase that we can extend the energy transition to all countries. It’s possible.”

If accompanied by sound policies, the transformation driven by renewables such as solar can bring substantial socioeconomic benefits, IRENA’s new report finds. The global solar industry has the potential to employ over 18 million people by 2050, four times more than the 4.4 million jobs today.

Over the last decade, installed capacity of off-grid solar PV has grown more than tenfold, from roughly 0.25 GW in 2008 to almost 3 GW in 2018 around the world. With its modular and flexible nature, solar PV technology can be adapted to a wide range of off-grid applications and to local conditions. Indeed, off-grid solar PV is a key technology for achieving universal electricity access, in line with the UN Sustainable Development Goals.

Similarly, the deployment of rooftop solar PV systems has increased extensively, which today makes solar PV in some markets more attractive than buying electricity from the grid. The competitiveness of distributed solar power is clearly raising deployment in large markets, including Brazil, China, Germany and Mexico.

Statistical highlights:

Accelerating solar PV can cut energy-related CO2 emissions by 21 per cent in 2050.

With over 50 per cent of installed capacity in 2050, Asia (mostly China) would continue to dominate solar PV power, followed by North America (20%) and Europe (10%). The Latin American market would grow from 7 GW in 2018 to over 280 GW.

Annual solar PV investment would have to increase by 68 per cent on average globally, from USD 114 billion in 2018 to USD 192 billion in 2050.

Global levelised cost of electricity (LCOE) for solar PV will continue to fall from an average of USD 85 cents per kilowatt-hour (kWh) in 2018 to between USD 5-14 cents per kWh by 2050. A recent solar and wind power auction in Colombia was awarded for an average electricity price of USD 27 cents per kWh.

Due to innovations, solar PV remains a fast-evolving industry. Floating PV is one of the most prominent examples with global cumulative installed capacity exceeding 1 GW in 2018. Battery storage and electric vehicles are key solutions to support the grid and manage high shares of solar PV as well as to guarantee the flexibility of the power system.

The full report “Future of Solar Photovoltaic. Deployment, investment, technology, grid integration and socio-economic aspects” can be found here

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IRENA Facilitates Investment and Renewable Projects on Ground in Africa

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Boosting renewable energy projects on the ground requires scaling up investment. IRENA’s state-of-the-art analysis of enabling policy frameworks and finance mechanisms channel public and private investment in markets like Africa, Latin America, Asia, South-East Europe and the Small Island Developing States (SIDS). Now, IRENA is taking its work one step further by increasing the Agency’s on-ground impact with 15 regional and sub-regional platforms which aims at scaling up renewables deployment and investments.

One step in this new direction is the event that took place in Johannesburg as part of the Africa Investment Forum hosted by the African Development Bank. It facilitated renewable energy deal-making in Sub-Saharan Africa in partnership with Power Africa and the African Trade Insurance Agency. The event corresponds to IRENA’s new direction and way forward ensuring an acceleration of the renewable energy transformation globally.

Speaking at the Investment Forum in South Africa, IRENA’s Director-General Francesco La Camera underlined the importance of renewable energy to meet sustainable economic growth and Africa’s climate and development ambitions. “Now more than ever, renewables have become a compelling investment proposition”, said La Camera. “With renewable energy technology prices set to decline, the cost-competitiveness of renewables will strengthen further. IRENA’s analysis shows that nearly a quarter of Africa’s energy needs could be met from indigenous and clean renewable energy sources by 2030. This would result in a wide array of socio-economic benefits in terms of economic growth, welfare, employment and energy access. It’s Possible”.

IRENA has been committed to supporting African governments in their quest for a sustainable energy future. The Agency has supported countries in building attractive investment frameworks for renewables to strengthen institutional and technical capacity. It has also supported the development and financing of renewable energy projects through project facilitation tools. 
“A lot remains to be done to address the key risks and barriers that hinder the scale-up of renewable investment in the region”, La Camera continued. “There is no shortage of renewable energy project proposals which are competing for investor capital. But they are not always financially viable. Many proposals fail to materialize due to high cost of capital, limited access to risk mitigation solutions and long delays in projects”.

By building on its extensive project pipeline in Sub-Saharan Africa with over 90 renewable energy projects, the Agency has showcased 10 renewable energy projects at the Investment Forum. Projects from Cameroon, Cote D’Ivoire, Kenya, Mali, Senegal, Sierra Leone and Togo which have a total capacity ranging from 6 MW to 70 MW – covering technologies like wind, solar, bioenergy and hydropower – were presented.

IRENA’s project facilitation platform provides project owners and developers with increased visibility for their projects among financiers and other market players. Project owners have access to wide range of financial instruments provided by multiple investors from development finance institutions, private companies, utilities, private equity funds, donor and multi-donor facilities, commercial banks and more, as well as access to different services for example legal and financial advisory, environmental, project development and Engineering Procurement and Construction contracting.

More information about IRENA’s project facilitation.

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UNIDO and Morocco’s MASEN to strengthen cooperation to deploy renewable energy technologies

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photo: UNIDO

The United Nations Industrial Development Organization (UNIDO) and the Moroccan Agency for Sustainable Energy of the Kingdom of Morocco (MASEN) signed a Memorandum of Understanding (MoU) to develop and implement projects deploying advanced renewable energy technologies in Morocco and targeted African countries, with the aim of creating aspirations to support African countries on their path towards inclusive and sustainable industrial development.

The partnership with MASEN complements UNIDO’s ongoing activities under its flagship ‘Low Carbon Low Emission Clean Energy Programme’ in Africa, which seeks to reduce poverty by promoting industrial growth through renewable sources of energy. It already started in 2017, on the margins of the 22nd Session of the Conference of the Parties (COP 22) to the UN Framework Convention on Climate Change (UNFCCC), when UNIDO Director General LI Yong, and MASEN President Mustapha Bakkoury launched the Vanadium Flow Battery project to demonstrate smoothing and stabilizing electricity output. An official handover ceremony is planned to take place in Ouarzazate, Morocco, in conjunction with a workshop gathering Moroccan officials and representatives from neighboring countries.

With MASEN’s support, UNIDO proposes to create a platform for the dissemination of renewable energy technologies in targeted countries while developing the local production of some technology components, thus creating grounds for achieving shared prosperity, economic competitiveness and environmental sustainability.

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