SCALING UP
RENEWABLE
ENERGY
Photo: Sarah Fretwell/USAID
Photo: Sarah Fretwell/USAID
USAID FY2014 Energy Budgets
GCC Clean
Energy $93M
Energy for
Economic
Growth
$106M
Liberia $13M
Afghanistan
$224M
Haiti $24M
Pakistan
$117M
Energy
Reconstruction
$372M
Total Energy Budget ~$550M
Outline
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Clean Energy Trends
Why does Scaling Up Clean Energy Matter
Clean Energy Building Blocks
USAID’s approach
Photo: Sarah Fretwell/USAID
Developing Countries will build nearly three
times as much new energy capacity as
developed nations, at 7640GW
- around half will be renewables over the next
25 years.
Bloomberg New Energy Finance
New Energy Outlook 2015
Photo: Sarah Fretwell/USAID
Wind and Solar will be the
cheapest source of new electricity
Why does scaling RE
supply, and in some countries will
start to outcompete existing fossil
fuel• plants.
Transition to low carbon energy systems
matter?
Bloomberg New Energy Finance
• Renewable Energy is approaching the least-cost solution:
– In US (second half 2013/first half 2014)
– Source: Bloomberg New Energy Finance US PPA report
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Coal: $24/MWh
Wind: $36/MWh
Solar PV: $56/MWh
Gas: $60/MWh
• Renewable Energy can provide energy security, energy
access
Photo: Sarah Fretwell/USAID
USAID’s Scaling Up RE
• Supporting the addition of tens of thousands of MW of RE
• Increasing the % of renewables in total installed capacity and
the % of renewables in total electricity delivered
• Establishing the building blocks:
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Strategic Energy Planning
Smart Incentives
Finance
Renewable Energy Zones (REZ)
Grid Integration
Competitive Procurement
Strategic Energy Planning
Set Goal
Policy and
Actions
Examples
• Low Emission Development Strategies
• Nationally Determined Contributions
• Renewable Energy Targets
• Power Development Plans
Allocate
Resources &
Implement
India Solar Mission
22GW by 2022
“Mexico is committed to reduce
unconditionally 25% of its Greenhouse Gases
and Short Lived Climate Pollutants emissions
(below BAU) for the year 2030.” – Mexico
INDC
Integrated Resource Planning (IRP)
Supply Side
Existing & New Sources
Hydropower
Coal, Oil
Natural Gas
Renewables
Electricity Imports
Demand Side
Transmission
Existing and New Lines
HV Transmission Lines
New line build options
Electricity Demand
Industrial,
Commercial, Residential
Energy Efficiency
DSM
Performance and Cost Characteristics
Least-Cost Planning Model
Power and/or other fuels: Scenario Modeling
addressing selected sensitivities, policies, risk mitigation options
IRP: A comprehensive decision support tool for meeting the objective of providing
reliable and least-cost electric service to all customers while addressing the
substantial inherent risks and uncertainties.
Smart Renewable Energy Incentives
TYPES OF INCENTIVES FOR RE
EXAMPLES
Accelerated depreciation
FISCAL
Widely used
Tax credits
US RE Production Tax Credit
Tax exemptions
Texas & California RE property tax exemption
Customs and related exemptions
Kenya
FINANCING
India
Financing facilities
Loan guarantees
U.S. for solar thermal
Capital grants
India GBI program
Surcharges to pay for RE
Germany
Special purpose bond programs
US Clean Renewable Energy Bond Program
Property tax financing
Texas local government RE loan program
Feed in Tariffs
CONTRACTUAL & REGULATORY
Widely used
Renewable Portfolio Standards
Philippines RPS
PPAs awarded through reverse auctions South Africa, Indian reverse auctions
Philippines Green Energy Option
Consumer directed choice of RE
Renewable Energy Certificates
India's state REC program
Net metering of PV
Widely used
"Must take" requirements
OPERATIONAL
Widely used
9
Renewable Energy Finance
In 2015,
clean energy
attracted a
record
$329 Billion in
global
investment,
nearly six times
its 2004 total
Approach:
Increase Access to Finance
Lower Cost of Finance
Public Instruments
Loan guarantees
Low-interest loans
Accelerated depreciation
Private Instruments
Risk reductions
Standardized contracts
New business models
Capacity Building for Financial Institutions
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Bank Indonesia (BI) – Green
Lending Model for MiniHydropower
BI – International research on
investment incentives
BI & MoEnvironment training on
the environment and social risk
assessment
Clean Energy Handbook for
Banks and FIs
Direct support to 5 conventional
banks, 2 Syariah banks, and 5
non-bank financial institutions.
Transition support to Financial
Services Authority/OJK
Renewable Energy Zones
Locate in areas of
best resources
Develop common
infrastructure
Engage Private
Sector
Opportunities
Kazakhstan
Nepal
Jamaica
Mexico
Colombia
India
Kenya Bangladesh
Ghana
Indonesia
South Africa
Afghanistan
Pakistan
Philippines
Vietnam