Fossil fuels switch to renewables: key to development

By Muhammed Ali Gurtas

ISTANBUL (AA) - The importance of energy transition from fossil fuels to renewable sources and its financing were discussed by a leading group of speakers at the 23rd World Energy Congress (WEC) in Istanbul on Tuesday.

During a session at the WEC, of which Anadolu Agency is the global communication partner for 2016, speakers stressed that energy transition is required to meet the needs of billions of people who have no access to energy.

Dr. Hakima El Haite, Morocco's minister of environment, said that two billion people around the world cannot progress due to the lack of electricity, which she said is essential for development.

"We cannot build the future with [only] fossil fuels. The Stone Age is over but we have to live with stones and rocks. We should establish a balance between renewable sources and fossil fuels," El Haite stressed.

She asserted that the ratio of solar power plants in Morocco for the production of electricity would exceed 50 percent by 2030.

"We don't give any subsidies to conventional projects. Otherwise the renewable energy sector would not be developed. We have a solid master plan, and we are working in cooperation with the private sector," she said.

Saeed Mohammed Al Tayer, managing director and CEO at the Dubai Electricity and Water Authority (DEWA), spoke about the United Arab Emirates (UAE) 'green fund'.

"This clean fund, worth $27 billion, provides individuals, companies, and developers with financial support. The main targets are energy efficiency, renewable energy investments, and R&D in that field," he said.

He added that through their strategy and initiatives, $30 billion in energy investments will be made by 2030 in the UAE.

Christopher Knowles, head of climate finance at the European Investment Bank (EIB) located in Luxembourg, highlighted that investors approach energy investments with profits as a motive.

"Investors always pay attention to the business side of a project, and none of them want to lose money," Knowles said.

Knowles remarked that the EIB had financed various climate-friendly activities with $100 billion in the last five years in accordance with the bank's sensitivity to climate change.

"A business environment expects stability and clarity. At the EIB, our role is to make economic risks manageable," he said.

Yongping Zhai, technical advisor in energy field at the Asian Development Bank (ADB) centered in Philippines, noted that there were 600 million people in Asia who have no access to electricity.

"Our priority is to provide clean energy to the poor populated areas. Many countries have been suffering from high costs, lack of technology and insufficient ability. The ADB believes that innovation in both technology and in business models would be essential for energy transition," he said.

Tayfun Bayazit, country chairman at the Marsh & McLennan Company in Turkey, focused on the importance of foreseeing issues in the financial sectors.

"Foresight has a very significant meaning in the finance sector. The global financial crisis of 2008 hit many economies which cut subsidies in energy sector and this was unforeseen," Bayazit said alleging that this move shook investors' confidence.

"Energy policies should be clear, predictable, and backed by a legislative framework. There is quite enough liquidity in this sector but the important point is how investors could benefit from these sources," he said.