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CEO Of Mainstream Renewable Power Questions Funding Decarbonization

Eddie O’Connor, the CEO of Mainstream Renewable Power, has called into question the need to financially support the decarbonization of economies like India.

12285455824_850324345c_oOn Thursday, Eddie O’Connor called for a rethink of climate finance at COP21, the United Nations climate negotiations currently entering their final hours in Paris. “We must learn to stop whistling yesterday’s tunes,” O’Connor said, suggesting that established renewables such as onshore wind and solar are already cost competitive with fossil fuel generators in emerging markets like India, and do not necessarily require the muddled and complicated subsidy schemes many believe they do.

“I know there are governments including India and others, looking for financial support from the USA and Europe to facilitate the support schemes that they think will be needed to incentivise new investment in renewable energy,” continued O’Connor, who believes that such support is not needed. “In South Africa, new onshore wind can be built for less than half the cost of a new coal plant. What COP21 can do is to incentivise sustainable behaviour by countries, companies, and families. By far the best way to do this is to put a price on carbon. A €30 price per tonne of CO2 would rapidly accelerate the transition to sustainability.”

The cost of solar and wind has been a continuing discussion throughout 2015, with numerous arguments for either side of the debate. Mainstream Renewable Power claims that over the last decade, the cost of onshore wind has fallen by over 60%, and solar PV has seen its costs drop by over 80%, “to a point where they are both cost competitive with, and quicker to install, than coal or gas in many markets.”

“Onshore wind energy is one of the cheapest sources of new generation available today,” said O’Connor, who speaks from experience — Mainstream Renewable Power is developing wind and solar plants across a number of markets, including South Africa, Egypt, Ghana, Chile, and Mexico.

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Jeffreys Bay wind farm, South Africa

A report by Bloomberg New Energy Finance published in October reached similar conclusions, finding that the levelized cost of electricity for onshore wind was now fully competitive with gas and coal in certain parts of the world.

“Our report shows wind and solar power continuing to get cheaper in 2015, helped by cheaper technology but also by lower finance costs,” said Seb Henbest, head of Europe, Middle East and Africa at Bloomberg New Energy Finance. “Meanwhile, coal and gas have got more expensive on the back of lower utilisation rates, and in Europe, higher carbon price assumptions following passage of the Market Stability Reserve reform.”

“The deployment of large amounts of new wind and new solar PV plant is no longer reliant on support schemes like the feed-in tariff, or green certificates,” continued O’Connor. “These programmes were very effective at bringing forward new technology when it was more expensive than new fossil plant. But, today, new wind, and in some markets, new solar PV, are now cheaper – in fact, a whole lot cheaper – than new fossil generation.”

Image Credit: via Mainstream Renewable Power, Flickr

 
 
 
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