Major economies sharply increased support for the production and consumption of coal, oil and natural gas, with many countries struggling to balance longstanding pledges to phase out inefficient fossil fuel subsidies with efforts to protect households from surging energy prices, according to analysis released today by the Organisation for Economic Co-operation and Development and the International Energy Agency.
New OECD and IEA data show that overall government support for fossil fuels in 51 countries worldwide almost doubled to 697.2 USD billion in 2021, from 362.4 USD billion in 2020, as energy prices rose with the rebound of the global economy. In addition, consumption subsidies are anticipated to rise even further in 2022 due to higher fuel prices and energy use.
“Russia’s war of aggression against Ukraine has caused sharp increases in energy prices and undermined energy security. Significant increases in fossil fuel subsidies encourage wasteful consumption though, while not necessarily reaching low-income households,” OECD Secretary-General Mathias Cormann said. “We need to adopt measures which protect consumers from the extreme impacts of shifting market and geopolitical forces in a way that helps keep us on track to carbon neutrality as well as energy security and affordability.”
“Fossil fuel subsidies are a roadblock to a more sustainable future, but the difficulty that governments face in removing them is underscored at times of high and volatile fuel prices. A surge in investment in clean energy technologies and infrastructure is the only lasting solution to today’s global energy crisis and the best way to reduce the exposure of consumers to high fuel costs.” IEA Executive Director Fatih Birol said.
The OECD and IEA produce complementary databases that provide estimates of different forms of government support for fossil fuels. The current OECD-IEA combined estimates cover 51 major economies, spanning the OECD, G20 and 33 other major energy producing and consuming economies representing around 85% of the world’s total energy supply.
OECD analysis of budgetary transfers and tax breaks linked to the production and use of coal, oil, gas and other petroleum products in G20 economies showed total fossil fuel support rose to USD 190 billion in 2021 from USD 147 billion in 2020. Support for producers reached levels not previously seen in OECD tracking efforts, at USD 64 billion in 2021 – up by almost 50% year-on-year, and 17% above 2019 levels. Those subsidies have partly offset producer losses from domestic price controls as global energy prices surged in late 2021. The estimate of consumer support reached USD 115 billion, up from USD 93 billion in 2020.
The IEA produces estimates of fossil fuel subsidies by comparing prices on international markets and prices paid by domestic consumers that are kept artificially low using measures like direct price regulation, pricing formulas, border controls or taxes, and domestic purchase or supply mandates. Covering 42 economies, the IEA finds that consumer support increased to USD 531 billion in 2021, more than triple their 2020 level, driven by the surge in energy prices.
The OECD and IEA have consistently called for the phasing out of inefficient fossil fuel support and re-direction of public funding toward the development of low-carbon alternatives alongside improvements in energy security and energy efficiency. Subsidies intended to support low-income households often tend to favour wealthier households that use more fuel and energy and should therefore be replaced with more targeted forms of support.
Solar PV Employs More Women Than Any Renewables
Solar photovoltaic (PV) has emerged to be the leading employer in the renewable energy sector, both in global number of employees and in gender balance. In 2021, the solar PV industry employs 4.3 million people—one-third of all renewable energy jobs worldwide. Women account for 40% of this number. It is almost double the share of women employed in the wind industry (21%) and the oil and gas sector (22%). It is also higher than the average share of women employed in all renewables sectors, which is 32%.
The International Renewable Energy Agency (IRENA)’s new report, Solar PV: A Gender Perspective, finds that women fare best in solar PV manufacturing, representing 47% of the workforce. Service providers and developers follow with 39% and 37%, respectively, while solar PV installers perform the least, with barely 12% of the segment’s workforce.
“A just and inclusive energy transition is not only about energy access. It is about making sure everyone is included and benefits from the process,” says Francesco La Camera, Director-General of IRENA. “The findings of our new report are promising and confirm renewable energy’s great potential as an equal employer, but they also signal the need to step up our efforts to pave the way for more women to lead the energy transition and shape our shared future.”
Presented at the 8th World Conference on PV Energy Conversion in Milan today, the report highlights the need for equal opportunities for women in technical positions in science, technology, engineering and mathematics (STEM) and in other professional fields, where they hold 38% and 32% of positions, respectively. Additionally, there is a wide space for women to take over more decision-making positions, as they currently hold 30% of managerial jobs and barely 13% of senior management posts in the solar PV industry.
Decentralised solar PV, on the other hand, seems to offer significant opportunities, as the off-grid solar PV value chain engages women both in delivering solutions and as beneficiaries. Driven in part by off-grid solar PV deployments, women account for 35% of other non-technical positions such as marketing, sales, distribution, and product assembly and installation.
Based on IRENA’s global survey of some 1,300 individuals and organisations conducted in 2021, the report evaluates the role of women in the solar PV industry, highlighting barriers and opportunities. The most prominent barriers are perceptions of gender roles, lack of fair and transparent policies, as well as cultural and social norms that shape behaviour.
Raising awareness on gender equality, improving national as well as workplace policies, offering more training, networking opportunities and access to mentorships are all critical steps to level the playfield for women in the sector. These efforts are needed not only to increase the participation of women, but also to diversify the workforce by including the visions, talents and skills of all minority groups.
This is the third report in the Gender Perspective series, which is an integral part of IRENA’s extensive research work on the effects of renewable energy deployment during energy transitions. The initial focus on employment creation and skills was expanded over time to cover other socio-economic elements such as gross domestic product, broader measures of welfare, local economic value creation, improved livelihoods and gender-differentiated impacts.
Renewable energy jobs rise by 700,000 in a year, to nearly 13 million
Worldwide employment in the renewable energy sector reached 12.7 million last year, a jump of 700,000 new jobs in just 12 months, despite the lingering effects of COVID-19 and the growing energy crisis, according to a new report published by the International Renewable Energy Agency (IRENA) in collaboration with the UN’s International Labour Organization (ILO).
Renewable Energy and Jobs: Annual Review 2022, identifies domestic market size as a major factor influencing job growth in renewables, along with labour and other costs.
Solar growing fastest
Solar energy was found to be the fastest-growing sector. In 2021 it provided 4.3 million jobs, more than a third of the current global workforce in renewable energy.
With rising concerns about climate change, COVID-19 recovery and supply chain disruption, countries are turning inwards to boost job creation at home, focusing on local supply chains.
The report describes how strong domestic markets are key to anchoring a drive toward clean energy industrialization. Developing renewable technology export capabilities is also dependent on this, it adds.
‘Just transition for all’
ILO Director-General, Guy Ryder, said that “beyond the numbers, there is a growing focus on the quality of jobs and the conditions of work in renewable energies, to ensure decent and productive employment.
“The increasing share of female employment suggests that dedicated policies and training can significantly enhance the participation of women in renewable energy occupations, inclusion and ultimately, achieve a just transition for all.”
Mr. Ryder encouraged governments, organized labour and business groups “to remain firmly committed to a sustainable energy transition, which is indispensable for the future of work.”
Resilient and reliable
IRENA’s Director-General, Francesco La Camera, said that in the face of numerous challenges, “renewable energy jobs remain resilient, and have been proven to be a reliable job creation engine. My advice to governments around the world is to pursue industrial policies that encourage the expansion of decent renewables jobs at home.
“Spurring a domestic value chain will not only create business opportunities and new jobs for people and local communities. It also bolsters supply chain reliability and contributes to more energy security overall.”
Joining the renewable revolution
The report shows that an increasing number of countries are creating jobs in the renewables sector – almost two-thirds of them in Asia.
China alone accounts for 42 per cent of the global total, according to the report, followed by the EU and Brazil with 10 per cent each, and the US and India with seven per cent each.
Southeast Asian countries are becoming major solar photovoltaic (PV) manufacturing hubs and biofuel producers, while China is the pre-eminent manufacturer and installer of solar PV panels and is creating a growing number of jobs in offshore wind.
India added more than 10 Gigawatts of solar PV, generating many installation jobs, but remains heavily dependent on imported panels, the report notes.
Europe now accounts for about 40 per cent of the world’s wind manufacturing output and is the most important exporter of wind power equipment; it is trying to reconstitute its solar PV manufacturing industry.
Africa’s role is still limited, but the report points out that there are growing job opportunities in decentralized renewables, while in the Americas, Mexico is the leading supplier of wind turbine blades.
Brazil remains the leading employer in biofuels but is also adding many jobs in wind and solar PV installations. The US is beginning to build a domestic industrial base for the budding offshore wind sector.
Guterres: ‘Global addiction to fossil fuels’ must end and a ‘renewables revolution’ jumpstarted
Achieving a just and equitable energy transition is “one of the biggest challenges facing our world,” UN Secretary-General António Guterres told the Global Compact Board meeting on Sunday.
Climate disasters and skyrocketing fuel prices have made the need to “end our global addiction to fossil fuels” crystal clear, he said, underscoring the importance of investing in renewables, building resilience, and scaling up adaptation.
“Had we invested massively in renewable energy in the past, we would not be in the middle of a climate emergency now”.
Renewals: ‘Only credible path’
Renewables are “the only credible path” to real energy security, stable power prices and sustainable employment opportunities, said the UN chief.
He also maintained that the share of renewables in global electricity generation must increase from nearly 30 per cent today to over 60 per cent in 2030 and 90 per cent in 2050.
“Leaders in business as well as government must stop thinking about renewables as a distant project of the future”, underscored the top UN official.
“Without renewables, there can be no future”.
Key energy priorities
The Secretary-General went on to outline his Five-Point Energy Plan to shift to renewables, beginning with treating the technologies as freely available “global public goods”.
“Identifying patents that can be made freely available – especially those relating to battery and storage capacity – are crucial for a rapid and fair energy transition,” he said.
Next, he highlighted the need to secure, increase, and diversify supply chains for renewable energy technologies, pointing out that supply chains for components and raw materials are “still concentrated in a handful of countries”.
Third, was to level the playing field for renewables.
“We have the technology, capacity, and funds,” said the UN chief, “but we urgently need to put policies and frameworks in place to incentivize investments and eliminate bottlenecks caused by red tape, permits and grid connections”.
Shift subsidies from fossil fuels to renewable energy was his fourth point, as he noted that each year, governments spend around half a trillion dollars to artificially lower the price of fossil fuels – “more than triple what renewables receive”.
“If we channel these resources and subsidies to renewables, we not only cut emissions; we also create more decent and green jobs,” he argued.
Financing the future
Mr. Guterres’ fifth and final point focused on the importance of tripling public and private investments in renewables to at least $4 trillion dollars a year.
“Upfront costs for solar and wind power account for 80 per cent of lifetime costs – meaning big investments today will reap even bigger rewards tomorrow,” he said.
However, this requires: financing to flow to those who need it most; adjusted risk frameworks and more flexibility to scale up renewable finance; and lowering financing costs for developing countries.
“The cost of capital for renewable energy projects in the developing world can be seven times higher than in the developed world,” flagged the UN chief, flagging that Africa attracts a mere two per cent of clean energy investments despite its vast renewable energy potential.
Walking the talk
According to Mr. Guterres, a just transition to a renewable energy future is everybody’s business, including the private sector to advance science-based targets and Just Transition plans, in partnership with labour organizations and civil society.
“Lip service won’t do. We need credible actions and accountability,” he underscored.
“The UN Global Compact is poised to help in this vital effort,” he spelled out, urging everyone to accelerate action across industries and regions “to jumpstart the renewables revolution”.
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