BY MATHEW CARR
Oct. 4, 2021 — LONDON — The U.S. is offering to support energy transitions in major emerging economies, such as India, Indonesia, and South Africa, according to its energy compact endorsed by special climate envoy John Kerry.
The country will “harness bilateral cooperation and engagement to help India reach its stated goal of achieving 450 gigawatts of installed renewable energy capacity by 2030,” according to the document, emailed by the Dept. of State. It’s achieving 100 GW through this year and has also set an interim goal of 175 GW of installed renewable energy capacity by 2022. So, in that context, 450 GW looks doable.
For context, that’s about five times the total capacity of the current UK power system.
According to the document: Helping accelerate the clean energy transition in India, which has the fastest-growing emissions among major economies, will set an example for promoting rapid clean energy transitions and economic development in emerging economies around the world.
India is the third-largest energy consumer and its domestic greenhouse gas emissions account for more than 7% of the global total, the third most behind China and the United States.
Time frame: Major emerging economies are projected to drive global emission growth, absent urgent action, in this critical decade through 2030 to curb emissions, according to the document.
Keeping the goal of limiting average global temperature rise to 1.5 degrees Celsius alive through 2030 is dependent, in part, on India acting urgently this decade to rein in emissions, including through achieving its target of 450 GW of renewable energy, which “the United States is committed to supporting India in achieving,” it said.
Detailed Compact
Last month, Adani Green Energy Ltd (AGEL), India’s largest renewable energy company, priced its maiden ListCo senior issuance of $750 million through a 3 year issuance at a fixed coupon of 4.375%.
The issuance was oversubscribed by 4.7 times.
This issuance establishes AGEL as one of India’s leading credits in the renewable sector. It has completed the final phase of its capital management plan, and now has a fully funded program for both debt and equity for its stated target of 25 GW by 2025.
On LinkedIn, I asked Adani group CFO Robbie Singh will Adani become more ambitious following the hot demand:
“Given the strong demand …why not raise your 2025 and 2030 targets? That is — build even more green stuff ? Don’t you have the capacity to do so?” I asked.
“Very likely,” was Singh’s response. (see note 1)
Repeated: The US International Development Finance Corporation (DFC) is to phase out new carbon-intensive investments by 2030.
“To achieve its net-zero goal, DFC will ramp up support for clean energy deals such as renewable energy and energy efficiency projects and phase out new carbon-intensive investments by 2030. DFC also intends to invest in natural climate solutions in support of carbon sequestration efforts.”
See also this target: Execute a credible plan to achieve net zero by 2040 in DFC’s portfolio, a target based on careful accounting and credible assumptions regarding DFC investments, including ramping up support for renewable energy.
Time frame: By 2040
Context for the ambition: Many developing countries can play a pivotal role in reducing emissions over time. Although low and lower-middle income countries tend to be relatively low emitters, they also represent a great need for additional electricity to meet current and future demand. If these countries can generate their future supply from renewable resources, they can help change the global emissions trajectory. DFC plans to achieve net zero emissions within its portfolio by 2040, representing the earliest net zero target for any Development Finance Institution (DFI) from a G7 or G20 country. This target is based on careful accounting and credible assumptions regarding DFC investments, including ramping up support for renewable energy and energy efficiency.
China is curbing its finance for coal stations, at least so far those outside its national boundary.
NOTES
2.