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The report also calls for innovative technology to retrofit and indeed replace ageing fossil fuels plants across the developing world, especially carbon capture and underground storage (CCUS) and hydrogen.
"Societies can reap multiple benefits from investment in clean power and modern digitalised electricity networks, as well as spending on energy efficiency and electrification via greener buildings, appliances and electric vehicles [EVs]," the report said.
In order to meet the Paris 1.5 °C climate change temperature target, investment in power must increase in EMDEs in the 2020s five times from $45 per person today to $240 per person by 2030.
This spending would cover clean power and electricity networks, as well as spending on energy efficiency and electrification via greener buildings, appliances and EVs.
This would equate to at least 1,600 GW of renewable capacity being added by 2030, increasing the share of renewables in total installed capacity to well above half by 2030, from 30% today.
The report follows on from the IEA’s May report that called for an immediate end to the financing of new coal-fired power plants.
The report also gave a date of 2040 for a total phase-out of coal generation in developing economies, 10 years later than a target date of 2030 for advanced economies.
Conclusion
The report warns that while aligning capital markets with net-zero goals is possible for developed economies, such a development risks excluding EMDEs, leaving them with higher-carbon footprints or a more challenging road towards cleaner energy.
The call for more clean energy in developing markets comes as the cost of renewables is falling, and, for example, solar prices are at their lowest ever level. At recent auctions, the cost of solar has fallen to $0.035 or even $0.015 per kWh.
While there is plenty of solar, wind and distributed energy capacity in emerging markets in Asia and Africa, what is lagging behind the falling cost of renewables is government support, often in the form of support for investment and risk mitigation, and the lack of appropriate finance.
Across the developing world, the European model of universal grid access, guaranteed power supplies for major industrial customers, regular maintenance, cross-border trading and more competition, especially in the generating and retail ends of the market, is not an immediately usable solution. It is also not attractive to investors.
The IEA stressed that time is of the essence and that current trends in investment volumes must be reversed quickly.
Central bank says 50% of Romanian bank loans bear climate change risk
bne IntelliNews
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polluting businesses, Florian Neagu, deputy director of the National Bank of Romania (BNR) and coordinator of the National Committee for Macroprudential Surveillance (CNSM) working group set up to support green financing, told Economica.net.
Only 3% of the bank assets (about RON5bn or €1bn) are green loans, more precisely loans extended by banks for projects aimed at reducing debtors’ exposure to climate change, he added.
The figures are as of the end of 2020 and the RON1.25bn loan extended by BRD Societe Generale to hydropower company Hidroelectrica has improved the figures a bit, he admitted.
The CNSM study shows that, on average, each bank
is exposed by at least 10% to credited companies that are “brown”, and the top five banks in the system have accumulated a total risk of 55% of assets. Agricultural firms are the most exposed.
BNR has developed a framework for monitoring economic sectors that may be affected by climate (transitional) risk and their importance to the banking sector, using the information collected at a sectoral level, combined with individual data on bank exposures. Each Romanian bank has a minimum exposure of 10% of assets on companies that may be severely affected by climate risk.
“The top five banks in the system have accumulated a total risk of 55% of assets”
ver 50% of the Romanian financial sector's exposures are to companies that are “at climate change risk”
and 25.4% of total non-government credits finance
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