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Christiana Figueres: Faster shift of capital towards new, sustainable energy mix required

January 21, 2013

World Future Energy Summit
Abu Dhabi, 16 January 2013
Statement by Christiana Figueres, Executive Secretary, United Nations Framework Convention on Climate Change

Ladies and gentlemen,

I am so glad to be back in the Gulf region, it seems like I have been spending a lot of time here recently! And thank you for the invitation to address you at the World Future Energy Summit. I cannot think of a better place for us to assess how the world’s energy landscape is changing to meet a future demand that will not only be higher than today’s, but very different in quality to today’s.

In the recent World Energy Outlook 2012 report, the International Energy Agency documents both the level and quality of this demand, giving several possibilities for the energy mix that emerging. The group gathered here today has the power to design a mix that can supply demand at necessary levels, and is low carbon.

The world currently faces a climate crisis that dwarfs the recent fiscal crisis from which we are still emerging. Certainly, scientists have known about climate change for a long time, but we are now beginning to live its devastating effects, and no one is immune.

We are all vulnerable and we all have already been, or will be, affected. As our population grows towards the 2030 estimate of 8 and a quarter billion, the warming world threatens more and more people – people who need food, water, energy and climate stability to survive. Creating a workable future energy mix that meets these needs without increasing vulnerability is crucial and the cost of inaction is severe.

Part of the challenge of creating a new energy mix – of transforming the world into a low-carbon economy – is doing it during difficult financial times. It is often said that we need to wait until markets improve or until government revenue is up before we shift towards clean energy. I disagree.

Study after study says the longer we wait, the more expensive it will be to transform the world economy. This means that right now we are presented with a great opportunity. We have the opportunity to shift investment away from the current unsustainable model. We have the opportunity to incentivize renewable energy investment through policy that creates jobs, builds infrastructure and enables smart growth. And, we have the opportunity to create an environment of innovation that starts with a knowledge-based economy.

We are at a point where we can say this transformation has begun, the capital shift towards the new energy mix has started. In 2010, world electricity production by renewables passed the 20% mark. In 2011, renewable energy investment topped 1 trillion [US] dollars. In 2012, the renewable energy industry added 1.5 million new jobs to the world economy. And, the cost of solar and wind energy continues to decline, while the efficiency of these technologies continues to increase.

While this is all good news, the fact is that the necessary capital shift is not happening fast enough, or with enough scale, to do what science says is needed to keep global warming below the internationally-agreed mark of 2 degrees Centigrade. Just consider that renewable energy investment, even at a record 1 trillion dollars, only equals one per cent of the issued global bond market.

Now is the time to accelerate the capital shift. We can do this in several ways. We can use public capital to de-risk private capital and strengthen the investment trend. We can vertically integrate international and national policies to encourage capital deployment. We can intensify and diversify investment in renewables to move hydrocarbons into higher-margin applications. We can and must create financial instruments for clean technologies that appeal to investors looking for large scale investment. Low carbon doesn’t mean low growth or low profits. Low carbon is increasingly growth friendly and investor friendly, in addition to environmentally friendly.

After spending a lot of time in the Gulf region, I have seen great examples of investment in a new, cleaner energy mix. Abu Dhabi is using solar energy and building Masdar City to create a hub of renewable energy. Saudi Arabia has adopted ambitious renewable energy targets with several other GCC states joining in. Qatar, recent hosts of the Climate Change Convention in a LEED-certified and partially solar powered facility, is adding 1.8 gigawatts of solar power to their energy mix. And this summit, sponsored by the United Arab Emirates, explores future energy, energy efficiency and clean technologies. When the countries that export the primary fuels of the past 150 years invest time, money and effort into new, clean technology, it clearly shows that it is time to embrace this new investment strategy.

This summit encourages the worldwide dialogue that can result in a revolutionary energy mix that emphasizes clean technology. In this room are the leaders of a clean energy revolution: business leaders, national government leaders, international policy leaders. Today, I challenge you to lead us into the low-carbon future in ways that make sense for your countries and constituencies, your inhabitants or your investors.

If you are a business leader, it is your challenge to think beyond the quarterly bottom line. Look at energy efficiency and technology to improve profitability and your reputation with consumers and investors looking to go green.

If you are a national leader, it is your challenge to create policies that address climate change and contribute to energy security that comes from renewable energy, clean technology and energy efficiency.

If you are a leader in international policymaking, it is your challenge to take the steps needed to usher in a new universal agreement by 2015 and accelerate action before 2020.

Our world is changing, and with it, so are our responsibilities. We all have responsibilities in determine the future that will also be the response to climate change. By working together and meeting this challenge head on, without delay, we can create the low-carbon economy that the world so urgently needs. A cleaner future energy mix is a critical component of this low-carbon economy.And so, I implore you to ask: Am I doing everything in my power to design the new energy mix? Am I doing everything in my power to determine the lowcarbon future?

Thank you.

 

Source: UNFCCC

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