‘India may join offshore wind alliance’
7 min read 23 May 2023, 11:05 PM ISTIRENA is also working with the COP Presidency to look at you know how the renewables can be trebled till 2030.
PremiumNew Delhi: India is “very actively" considering joining the Global Offshore Wind Alliance in an attempt to improve its energy transition standing, said Gauri Singh, deputy director general of the International Renewable Energy Agency (IRENA), which played a key role in forming the alliance. The organization has invited India to join it, which would help New Delhi in terms of technology and knowledge transfer, she said in an interview. So far 14 countries—Australia, Belgium, Colombia, Denmark, Germany, Ireland, Japan, the Netherlands, Norway, Portugal, Spain, Saint Lucia, the UK, and the US —have joined the alliance. Edited excerpts:
India plans to set up offshore wind projects in Gujarat and Tamil Nadu. Will we see coordination of IRENA and India in this space?
We had, along with the Global Wind Energy Council and a few member-states, gone to the UN last year with the very ambitious goal of how the global community could come together with strong showing on offshore wind. So, there was an alliance that got formed called the Global Offshore Wind Alliance, which is being coordinated by IRENA, and has many countries, including Denmark, as its member or a partner in this whole collaboration. I think India is also considering very actively becoming a part of this alliance. It has been invited.
We are expecting in the next two months to see the first offshore wind procurement tender coming out (in India) and that itself with the kind of visibility that the ministry is talking of about 37 GW getting procured by 2030. I think it’s a hefty target and that gives us a lot of reason to cheer.
How do you see the flow of climate finance to developing countries that need a just energy transition?
If you look at the global investments into renewable energy, they were almost half-a-trillion (USD) last year. So, it was a big boost to the amount of capital that’s flowing to renewable energy. But then when you start disaggregating it and also look at the data on how much has really gone into developing countries, then you start looking at not a very pretty picture. So, you see that developing countries have in fact been progressively receiving declining shares year-on-year. In fact the developing and emerging markets, probably have half the world population, but in terms of the money they’re receiving for renewables, it’s just 15%. It’s definitely not proportionate and if you go even further to the least developing countries then they attracted even less than 1% of the renewable energy investments on an average between 2013 and 2020. This then means that although more amount of money is needed for the energy transition and more money needs to go into energy transition technologies, renewables included, but when we talk about just energy transition, then naturally we also have to look at how the financial flows are happening. So, it does leave a lot to be desired and developing countries and least developed countries are really not receiving much in terms of this share of financial flows.
What’s to be done to increase the flow of funds to the developing world, more so as there are recessionary fears in the developed world?
The amount of flows that needs to come into the energy transition technologies and with the parts of it going to developing countries, I think those flows may not happen anytime soon in terms of it going to the developing countries and the reason is that there have been pressures that the developed countries are facing around their own energy issues and energy prices have gone up and there’s also a hardening of interest rates that’s happening.
But I think what’s needed is to relook at how MDBs (multilateral development banks) and IFIs (international financial institutions) are functioning. That is a low- hanging fruit because most of the money that goes to these MDBs and all of their capital comes from these developed countries. And if they can actually start looking at reforms happening there that will at least open up the flows to the developing countries. The second important thing is to look again at whether the money that’s going to the developing countries, what format it is taking and is there a need for new types of financing mechanisms to come into play that can leverage more private sector capital coming? In renewables... about 60-65% (of funding) is coming from the private sector, but we expect that percentage will grow.
What are you expectations for the global energy transition roadmap from the G20 talks under India’s presidency in 2023?
Regarding G20, it’s probably too early to say because you know they’re starting in this round, the discussion on the communique and we do hope to see some good outcomes in terms of also a decision around how much investments are needed for giving a boost to the net zero ambitions and what do these numbers look like in the short-to-medium term of 2030, we hope to see that kind of commitment coming.
IRENA is also working with the COP Presidency to look at you know how the renewables can be trebled till 2030. So you know we are working a lot with these multilateral forums to build a strong narrative for renewables deployment because we think that there is a very strong momentum, but the pace has to be ramped up substantially to reach, the 1.5 degree goals that we have set for ourselves as a global community, and I think you know we have very strong political momentum and intent backing this.
The solar power space has witnessed volatility in the past two years amid the pandemic and the supply chain issues with China dominating the module supplies. What is the scenario now and how will the supply chain issues ease out?
There is, as you know, a domination of one country on the supply of ingots, cells and modules. But the attempt is now to diversify the value chains of solar and to bring up many more manufacturing bases that can look at this huge sport that we will see also in terms of deployment of solar. So it’s not just looking at where we are right now, but looking at the opportunity of moving forward with the huge deployment that will happen in the next 20-30 years.
And, I think with the PLI (production linked incentive scheme), India is making a very strong bid to such a manufacturing base, but at the same time, what you also see is that there was this constraint that happened mostly the logistics issue during COVID and things like that, but I I think it’s easing up.
But, we do see that because the demand is going to be much higher, there may be some tightening in terms of the pricing of modules.
IRENA is also working with the COP Presidency to look at you know how the renewables can be trebled till 2030. So you know we are working a lot with these multilateral forums to build a strong narrative for renewables deployment because we think that there is a very strong momentum, but the pace has to be ramped up substantially to reach, the 1.5 degree goal that we have set for ourselves as a global community, and I think you know we have very strong political momentum and intent backing this.
The solar power space has witnessed volatility in the past two years amid the pandemic and the supply chain issues with China dominating the module supplies. What is the scenario now and how will the supply chain issues ease out?
There is, as you know, a domination of one country on the supply of ingots, cells and modules. But the attempt is now to diversify the value chains of solar and to bring up many more manufacturing bases that can look at this huge sport that we will see also in terms of deployment of solar. So it’s not just looking at where we are right now, but looking at the opportunity of moving forward with the huge deployment that will happen in the next 20-30 years.
And, I think with the PLI (production linked incentive scheme), India is making a very strong bid to such a manufacturing base, but at the same time, what you also see is that there was this constraint that happened mostly the logistics issue during covid and things like that, but I I think it’s easing up.
But, we do see that because the demand is going to be much higher, there may be some tightening in terms of the pricing of modules.
