RECAI: Latest developments
Brazil sees the light. Brazil has already awarded more than 3GW of renewables capacity this year, with 15GW of wind and 3GW of solar projects registered for November’s A-3 auction, and more than 20GW of renewables projects competing in December’s A-5 tender. With average wind prices less than US$50/MWh, this, along with possible solar-only auctions as early as next year, is good news for the fledgling solar sector.
France finances transition. The introduction of a carbon tax and nuclear levy as part of a new energy transition law, scheduled for early 2014, will help fund the annual €20b (US$27b) per year needed to boost renewables and energy efficiency. The carbon tax will not affect households’ transport or heating costs, or industrial companies already covered by the EU’s emissions trading scheme.
US green bank bonanza. In September New York launched its first green bank, using “limited state resources” to leverage at least US$1b in private investment for clean energy projects. The first investments are due in early 2014, with an initial US$165m of public funds providing loan guarantees and package loans for resale into the secondary market, to help overcome capital constraints and push private lenders into the market.
Australia swings its axe. Australia’s new Conservative Government has published draft legislation abolishing the country’s carbon pricing mechanism from 1 July 2014. Since September, it has also abolished the independent Climate Change Commission and vowed to close the green development bank. The Labour Party and the Greens hold the balance of power, making the passage of the law before July unlikely, but legislation could be applied retrospectively.
German pressures mount. Chancellor Angela Merkel remains in coalition talks with the Social Democrats following failed negotiations with the Green Party in October. While such a deal improves clean energy prospects relative to the previous coalition, prolonged uncertainty continues to slow momentum. Pressure to end renewables subsidies, and a further 18% increase in the consumer surcharge used to finance renewables support, is also mounting.
UK energy squabbles. Political point-scoring over rising energy bills has intensified energy policy tensions, leaving the renewables sector in a state of uncertainty. Labour’s controversial pledge to freeze energy prices in 2015 (perhaps a precursor for a more centrally planned energy market), a Conservative vow to cut consumer bills by reining in several green energy initiatives, and the Liberal Democrats’ fierce disagreement, suggests trouble ahead.
New clean energy investment worldwide, Q3 2013
New clean energy investment in Q3 totaled US$45.9b, a 14% reduction on Q2, making it almost certain that 2013 will mark the second consecutive annual reduction. This is in large part because of reduced European subsidies and cheap US gas, but also falling technology costs.