SunEdison project in Chile. Image: SunEdison.
As the climate negotiations wrap up in Paris I think it might be interesting to take a step back and look at the countries who have changed their tune about fossil fuels in the past few years and are now pushing for more renewable energy themselves. Some of them are some of the biggest fossil fuel producers in the world, but they see renewable energy as an economic opportunity. That's what's changing the energy conversation worldwide.
India has some of the most audacious renewable energy goals in the world, planning to install 175 GW of renewables by 2022. At the Paris summit Prime Minister Modi set a goal to get 30% of its energy from renewable energy by 2030.
Costs are coming down with bids falling 50% over the past five years. In November, SunEdison won a bid to build 500 MW of solar capacity for just 7.1 cents per kWh. The company is also looking to expand into microgrids in India.
One advantage of renewable energy in India is that it's dispatchable on a smaller scale than the centralized power grid. India's grid doesn't reach millions of its residents, so microgrids built with renewables could help bring energy to those who need it at a low cost.
If there's a country that needs renewable energy to grow in leaps and bounds it's the Maldives. The country is made up of nearly 1,200 islands and its highest point is just 2.4 meters above sea level. If predictions of sea levels rising between 0.3 meters and 1 meter by 2100 come true the country could see hundreds of islands go under water. The country's fight against climate change was also documented in the film "The Island President".
Beyond climate, there's an economic incentive for the Maldives to invest in renewable energy. The country's residents pay $0.30 to $0.40 per kWh for electricity and over 20% of the country's GDP goes to importing petroleum products. The remoteness of the country's islands means diesel generators are commonplace in the country, despite being a high solar resource location.
The Maldives is slowly making solar energy a bigger piece of its energy pie. A deal was recently signed with CCE Oasis Technology to build a 2.5 MW solar and diesel hybrid system in a five island network. And China Machinery Engineering Corporation will install 1.5 MW near the capital of Male.
Not only is renewable energy a financial necessity for the Maldives, it may be necessary for the country's very survival.
Deserts around the world are perfect for solar energy. Image: SunPower.
United Arab Emirates
The UAE may get most of its wealth from oil, but it's becoming a big investor in solar energy. Dubai announced a $27 billion program that would make solar mandatory for all building rooftops by 2030. The country plans to get 25% of its energy from renewables by 2030 and 75% by 2050.
Saudi Arabia's ACWA Power won a bid to build 200 MW of solar in Dubai with a tariff of 5.84 cents per kWh, a record low cost at the time.
All of this is part of UAE's Vision 2021 , aiming to get 24% of its energy from clean sources of energy. That's a big goal and a surprising one for a country that's largely dependent on fossil fuels for its economic success.
The biggest oil exporter in the world has an economic challenge on its hands as it economy continues to grow. Saudi Arabia burns a quarter of the oil it produces to make electricity for its citizens and electricity consumption is rising 7% a year. On top of that, it subsidizes both gasoline and electricity for its citizens, energy that could be sold to countries abroad.
That gives a major incentive for Saudi Arabia to develop solar energy and it has the resources -- both financial and from the sun -- to do it. A goal to build 41 GW by 2040 is a start, but the political will to build even that much solar is fragile in an oil driven country.
Like its Middle Eastern neighbors, Saudi Arabia may have more of an economic need for renewable energy than an environmental one. And the savings versus burning subsidized oil to power the country could be in the tens of billions of dollars.
I'm cheating on calling this a country, but in fact the entire continent of Africa would like to see renewable energy change its economic future. Two thirds of people in Africa lack power and without the infrastructure to power homes and businesses there's little hope for fossil fuels filling that gap. Enter distributed energy sources like wind and solar.
Akinwumi Adesina, head of the African Development Bank, says he wants to boost Africa's renewable energy output by 10x to 300 MW by 2030. The bank says it will invest $12 billion and will leverage $40-$50 billion in private sector investment in the space.
SunPower is one company who has seen the opportunity in Africa. It has a 160 MW module manufacturing facility in South Africa and will have over 100 MW of projects in operation by early next year. The company is also investing in new technology that will make lower cost panels suited for non-OECD, like the ones I've listed here.
The energy debate is changing
Even the fact that countries like Saudi Arabia, the UAE, and India want to expand their renewable energy presence shows a shift from just a few years ago. But they see this as an economic opportunity, not a threat to their development. That's a big change in the energy debate and investors should be paying attention to who is now joining the renewable energy charge.
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