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Renewable Energy and Efficiency in Southern Med and Eurasian Nations

SEMED and Eurasia has an opportunity to "leapfrog" outdated industrialization technologiesNew clean, more efficient energy, water, agricultural and industrial technologies are transforming the nature of economic growth and development, as well as the field of economics itself. Coupling these innovative technologies with ecologically and socially conscious government policies, regulatory regimes and private sector investment incentives, developing nations the world over can “leapfrog” now outdated models of industrial development that have been used by developed nations. Doing so can open up economic opportunity, enhance livelihoods, ecological health and integrity, and the overall well-being of billions.

Expanding with the inclusion of new members, the European Union (EU) has forged its place as a world leader at the forefront of the transition to clean, distributed renewable energy and energy efficiency technology. In its latest Insights Series 2015 report, the International Energy Agency (IEA) illustrates how providing equitable access to environmentally sustainable energy holds the potential to lift millions of people living across the southern Mediterranean region and former Soviet bloc nations that are in the early stages of making the transition to full EU membership out of poverty.

“The increased deployment of renewable energy and energy efficiency technologies (RE & EET) in the South Eastern Mediterranean (SEMED) region and in the Early Transition Countries (ETC) could bring a host of benefits, including enhanced energy security, increased national revenues and environmental gains,” highlight the authors of IEA’s “Enabling Renewable Energy & Energy Efficiency Technologies.”

Renewable energy, energy efficiency in Southern Mediterranean and Early Transition EU nations

EU ETC Renewable Energy  Penetration

With support from the European Bank for Reconstruction and Development (EBRD), in its latest Insights Series report, IEA provides a summary of the energy profiles for Southern Mediterranean and Early Transition Countries. Spanning two regions of tremendous geographic, ecosystems and natural resource diversity, the report authors point out the wide variations in energy resources and their development across the region.

EU ETCs Armenia, Azerbaijan, Belarus, Georgia, Kyrgyz Republic, Moldova, Mongolia, Tajikistan, Turkmenistan and Uzbekistan are all in the early stages of becoming full EU member nations. Over half the populations of these countries live below national poverty lines, EBRD notes on its Early Transition Countries Initiative website.

In “Enabling Renewable Energy & Energy Efficiency Technologies,” IEA researchers zoom in on renewable energy penetration, and the potential investment in and deployment of renewable energy and energy efficiency technologies holds when it comes to addressing issues of broad-based and equitable socioeconomic development, as well as EU mandates enacted to reduce greenhouse gas emissions, mitigate and adapt to climate change.

In the SEMED region, EBRD is helping national governments and public and private sector partnering organizations in Morocco and Jordan wean themselves off costly fossil fuel imports by developing their renewable energy resource potential and deploying energy efficiency technologies. As EBRD highlights on its SEMED Regional Sustainable Energy Financing Facility web page, countries across the region “are located in the global sunbelt and are rich in wind, geothermal and, in some instances, hydropower resources.”

The same is true of EU ETC countries. However, EU ETCs such as Azerbaijan and Turkmenistan have long relied on fossil fuel development and investments from multinational oil and gas companies as the primary sources of direct investment, socioeconomic development and wealth creation. Unfortunately these national resources and the resulting income and wealth that flows from developing them has typically been expropriated, winding up in the pockets, and well-hidden offshore bank accounts, of government leaders and small groups of politically well-connected individuals and business groups.

“On the whole,” the IEA Insights Series report authors write,”the renewable energy market in the region remains nascent, with small hydro and biofuels having had the most success, due largely to inability to attract investors given competitive pricing from other energy sources and an absence of clear and enforceable rules for grid modernization and integration.”

Removing RE, EE barriers

IEA EU RE EE policy framework

Similarly, an EBRD “snapshot” of energy markets, sources and uses across the SEMED nations of Egypt, Jordan, Morocco and Tunisia illustrates their diversity, and the challenges of overcoming the burden of commonly accepted political and business practices and development approaches. EBRD points out that structural institutional factors such as costly fuel subsidy programs, large fiscal and external deficits, and the prospect of political instability heightens risk perceptions and compromises “medium-term development of the region as a whole.”

That said, they go on to highlight that SEMED countries have made substantial progress when it comes to introducing institutional frameworks and deploying renewable energy and energy efficiency technologies in recent years.

“Morocco in particular has developed a range of policy tools and institutions that could serve as examples for others in seeking to increase the market penetration of RE technologies.

SEMED and ETC countries could benefit substantially by adding to and refining renewable energy and energy efficiency institutional policy frameworks and support, they add. More specifically, they should aim “to ensure consistent enabling conditions, such as the removal of fiscal support measures for fossil fuels.”

IEA addresses these and other obstacles to renewable energy, energy efficiency and sustainable development in the SEMED and ETC regions in its latest Insight Series report. In it, IEA researchers elaborate on:

  • Country and resource variations and comparisons;
  • Highlights overarching, “enabling” factors that can help set the necessary foundations for implementing policy to support RE&EET deployment (and, using the same analytical framework, summarizes potential barriers and response actions in Annex 2);
  • Analyzes policy options for both RE and EE, drawing on practical examples and highlighting indicative policies that correspond with varying levels of market maturity; and
  • Provides a checklist for assessing the level of supportiveness of national policy frameworks that comply with EU renewable energy and energy efficiency technology guidelines and specifications.

 

*Image credits: 1) World Bank/Abengoa; 2), 3) IEA, “Enabling Renewable Energy & Energy Efficiency Technologies”

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