In the research commissioned by the European Climate Foundation (ECF), the EY energy team has analyzed the investible pipeline of energy and resources opportunities across 47 key economies, including Romania) capable of supporting green recovery plans.
The research suggests that renewable energy presents governments with a “no-regrets” path to economic recovery, that could provide a step change in emissions reduction, 10 million jobs and some US$1.9t in economic growth. Moreover, by pulling on key policy levers, countries can unlock private sector investment contributing over 90% of the total investment opportunity,
Mapping the potential impact of identifiable projects in 47 economies that together comprise around 88% of global GDP isn’t a prediction of renewables deployment, but it describes what could be achieved if concerted action is taken now. International co-operation and private-public sector collaboration can together ignite a global green recovery. It can also regenerate depressed communities hit by legacy industries in developed economies and help developing economies build essential infrastructure and clean energy generation for the future.
Beyond direct emissions abatement, decarbonizing the power sector through renewable energy lays the foundation for reducing emissions in the rest of the economy through electrification. Deployment of good-to-go projects would reduce greenhouse gas emissions by 2.5 giga tons of CO2 equivalent (GtCO2e) annually, helping to close 9% of the global emissions reduction target for 2030 set out by the Intergovernmental Panel on Climate Change (IPCC) to limit global warming below 1.5°C. This highlights both the opportunity presented by the visible project pipeline and the scale of additional action required to meet IPCC’s global targets.
The visible project pipeline could create up to 10 million jobs, both counting jobs local to the projects, and jobs in the supply chain. Within countries, renewable energy can be particularly effective as a tool for creating employment opportunities outside of urban economic centers, especially when deliberate effort is put into strengthening local supply chains.
Moreover, deployment of off-grid and behind-the-meter projects can greatly exceed the visible pipeline. In Vietnam, rooftop solar capacity installed from 2019-2020 exceeded the visible four-year solar PV pipeline in 2018 by almost 100%. Installations in rooftop solar PV capacity in Vietnam have increased by 2,435% since the beginning of 2019, driven largely by a feed-in-tariff scheme. In December 2020, the feed-in-tariff scheme concluded leading to an increase in installed solar rooftop capacity by 6.7GW in that month alone.
Renewable energy investment does more than create jobs: it creates employment opportunities in some of the regions of the world where the need is greatest and where the alternatives are lacking.
As has been well-documented, GDP across the world declined in 2020 due to the economic impact of the COVID-19 pandemic. The total investment opportunity could mitigate or reverse a substantial proportion of the over US$2.2 trillion in economic losses due to the COVID-19 pandemic across the countries included in the study and lay the foundation for sustainable economic growth driven by abundant, low-cost, renewable energy. The pipeline of shovel-ready projects could provide an injection of more than US$1.9 trillion into the global economy over a three-year period, accounting for some 85% of the GDP lost in 2020. Furthermore, by deploying the pipeline, we estimate a permanent recurring GDP contribution of £60 billion resulting from operation of the assets.