I had a chance to participate in the Annual Meeting of the African Development Bank (AfDB) from May 23 to 27, 2016 in Lusaka.
The theme of this convention was “Energy and Climate Change”. Climate change action now stands alone in the Sustainable Development Goals (SDG 13). It seeks to take urgent action to combat climate change and its impact.
Further, African Union’s Agenda 2063 says that “we want a prosperous Africa based on inclusive growth and sustainable development”. The term ‘sustainable’ has some climate change dimension. So, is renewable energy about climate change?
A simple and straight answer is, “of course!” Let us make some considerations to explore why adopting renewable energy is both good business and good for business.
First, renewable energy is not just hydro, solar and wind. If we go by the definition of ‘unlimited’, we have oceans, biomass, geothermal, in all their forms. So when we benchmark renewables with grid electricity, we are limiting our view.
Secondly, that renewable technologies are rapidly evolving is obvious. So what might have been a major shortcoming five years back may now be historical.
Heavy investment continues to flow into this space, breaking barriers that made renewable energy look like mere fascination and fantasy; to becoming the better option.
From mass storage (like pumped storage which Norway leads us on) to smart wind turbines, from better integration to solar panel that only need daylight rather than sunlight, just to mention a few.
Thirdly; business is about revenues; positive cash flows; profits. All else is secondary. If you run an engine and it consumes diesel or oil, every hour costs money.
If you use a wind turbine for the same, most hours (if not all) cost nothing. It is fairly easy to see the business case in this straight illustration. What if in the two scenarios we were producing sugar? In case number one, the tonne of sugar from a plant running on diesel will cost more than that produced on wind (read renewable energy). Nationally speaking, if our electricity comes predominantly from diesel and fuel oil power plants, the electricity tariffs will be high.
At fourth place in our considerations is climate change. This is potentially the first in order of significance but we keep it at last because some people have made it look like a faith issue. How? You hear people ask, “Do you believe in climate change?”
But since we agreed to keep climate change out of this for now, here is the harsh reality: call it by any other name but drastic changes in weather patterns have caused extreme events, often wiping out entire decades of progress.
The AfDB Meetings ran concurrently with the United Nations Environment Assembly (UNEA2) at the UNEP in Nairobi, six months after the COP 21 Paris Agreement. In all these; SDG 7 that speaks on climate change and renewable energy is being driven as Sustainable Energy for All (SE4All).
So if not for climate change action, renewable energy is good for health, the environment, business, and yes, it prevents inflation too.
In conclusion, the oil revolution was not brought about by the discovery of oil, rather it was by the creation of oil refinery technology by the immortal oilman John D. Rockefeller.
That revolution fueled another revolution, that of the motorised wagon (motor vehicle), which shifted from electric to the internal combustion engine we know today, thanks to Henry Ford.
Similarly, renewable energy technology revolution is happening because we have developed ways to better use what we already have. Nobody will stop it.