CLEAN ENERGY DESPITE GLOBAL RECESSION

By Larry Smith

Friday, February 13, 2009.

Will the global economic slump set back efforts to promote green energy? Well, there is one significant source of optimism in this regard—the new American president, Barack Obama.

Although the short-term outlook for clean energy may be poor, Obama acknowledged in his inaugural address last week that "each day brings further evidence that the ways we use energy strengthen our adversaries and threaten our planet."

He has pledged strong support for a clean energy economy in America, by doubling the production of alternative energy in three years and implementing a nationwide carbon market to cut the greenhouse gases produced by fossil fuels. In the process, he promises to reassert US leadership on global climate policy.

The recession has caused oil prices to drop 70 per cent in recent months, but experts say there is still unprecedented interest around the world in green energy. This is based on the widely held belief that energy use must be addressed now, so that when the economy - and prices - recover, we don't find ourselves facing an even bigger crisis than before.

That's a real possibility because the economy, energy policy, and the environment are all wrapped up together these days. If we fail to reduce our fossil fuel dependence while we have some breathing space, we risk losing any economic gains we make when oil prices shoot up again.

Here, in the Bahamas, our own politicos seem to have accepted this message. State Environment Minister Phenton Neymour told a group of engineers recently that the Bahamas was "highly vulnerable" to rising oil prices because our economy relies totally on fossil fuel imports - at a cost of a billion dollars last year alone.

"In the long term one can expect that supply and demand pressures that have temporarily eased will return as global economic activity returns," he said. "This vulnerability directly impacts our ability to secure the goods and services required to drive our economy."

There is widespread agreement on this point. In fact, representatives from 100 countries met in Germany a few days ago to set up the International Renewable Energy Agency - an intergovernmental body formed to address the "urgent need to transform the energy sector to one that uses renewable energies and energy-efficient technologies."

IRENA was formed to tackle the obstacles to this goal - such as counterproductive regulatory frameworks, technical barriers, insecure financing of renewable energy projects, and lack of awareness of renewable energy opportunities. It aims to speed up the global transition to a sustainable energy sector.

And after years of muddling, we in the Bahamas now seem to be well on the way to embracing this goal. A preliminary national energy policy has been drafted, and other initiatives are in the works that could significantly reshape our fossilised energy sector, which is growing at 8 per cent a year.

"We've fallen behind on this so we are running a number of programmes in parallel to speed up the process," Minister Neymour told me recently. "Some of these things should have been done years ago and now we are trying to catch up."

The first report of the National Energy Policy Committee (a public-private sector group appointed by the government last year) was submitted to the Ministry of Environment in November. It says the government is committed to "aggressively re-engineering our legislative, regulatory and institutional frameworks, re-tooling our human resources and implementing a diverse range of sustainable energy programmes."

The report outlines a series of short-, medium- and long-term policy targets aimed at modernising our energy infrastructure. These targets focus on developing alternative energy sources, expanding financial opportunities in the energy sector, increasing energy efficiency and managing the demand for fossil fuels.

The most immediate goals range from phasing out the use of incandescent light bulbs, building energy efficiency into low-cost housing and cutting energy use in public buildings, to generating electricity from a variety of renewable technologies, offering incentives for more fuel-efficient vehicles, and mandating the use of solar hot water systems.

The report also points to the "significant and very positive economic impact" that can be achieved through the pursuit of emerging energy technologies, and urges the government not to be distracted from the long-term effort by the temporary decline in oil prices.

Meanwhile, BEC is evaluating about a dozen proposals to generate electricity using several renewable technologies - including wind, solar and waste processing. The most promising of these is the use of garbage as a fuel to produce electricity, since such projects pay for themselves while they address two major environmental problems.

Waste-to-energy options can produce at least 30 megawatts of electricity from the 230,000 tons of garbage we dump at the Harrold Road landfill every year. These technologies have the added benefit of reducing the waste stream and virtually eliminating the toxic fires that are a regular feature of the landfill.

Environment Minister Earl Deveaux says he will focus on waste-to-energy projects for Nassau - selecting a technology provider (or two) by March - while BEC officials continue their review of other renewable energy proposals. He will also be taking several planks out of the draft energy policy to short-circuit that process while the energy committee continues its work.

"By Easter we should have a lightbulb conversion campaign ready to go and we will be aggressively promoting solar water heaters and more energy-efficient homes and buildings," he told me. "Within eight months we should be in a position to change the regulatory framework to support renewable technologies."

Such changes would include lifting the ban on private power generation and enabling net metering, which lets consumers who make their own power earn credits from BEC. The review of regulatory and technical barriers to renewables will be undertaken by the Caribbean Renewable Energy Development Programme and the European Union Energy Initiative.

Encouraging consumers to switch from traditional incandescent lightbulbs to advanced compact fluorescents (known as CFLs) is seen around the world as the easiest way to reduce both energy consumption and carbon emissions. Strategies range from complete bans of incandescents, to gradual phase-outs combined with voluntary measures to deter sales of traditional bulbs.

Modern CFLs produce the same amount of light using about one fifth of the power of a traditional incandescent bulb, and they last much longer. Britain implemented a voluntary ban on incandescents this year and a mandatory ban will come into effect throughout the European Union next year.

Our government's initial public education campaign will focus on energy conservation by changing consumer behaviour, promoting energy-efficient appliances and improving energy management in public buildings. The campaign is expected to include a replacement programme for incandescent lightbulbs funded by the UNs Global Environment Facility.

The energy committee report notes that 35,000 solar water heaters have been installed in Barbados as a result of government incentives, saving about $16 million a year in energy costs. The committee wants 30 per cent of all Bahamian households to have solar water heaters installed within 10 years, and seeks to make this mandatory for all new construction.

Minister Deveaux also told me that the government has already decided to apply traditional principles of energy-efficient design to future public housing projects. And new town planning regulations now under review will seek to define a Bahamian "green building" standard that incorporates the kind of vernacular architecture we see in Harbour Island or Hope Town.

Giving a helping hand with all these initiatives is the ever-present Inter-American Development Bank, which provided a consultant to produce a preliminary energy policy framework way back in 2006. The IDB has allocated two technical cooperation grants to the Bahamas this year to carry the process forward.

The first is aimed at upgrading BECs operational capacity and exploring the incorporation of alternative energy sources in grid expansion plans. The second aims to develop broad support for sustainable energy programmes throughout the country. The value of both grants is about $1.5 million.

We began this column by saying that the collapse in oil prices had not wiped out a strong global interest in green power. Evidence of this fact abounded at the World Future Energy Conference in Abu Dhabi earlier this month. More than 16,000 people from 79 countries attended this spectacular event, including 300 journalists and 20 government delegations.

Oil-rich Abu Dhabi itself is pressing ahead with major investments in solar energy. The country's most prestigious project is the development of Masdar City -- a $22 billion town of 50,000 people that will run entirely on renewable energy and be the world's first zero carbon community.  In fact, this Persian Gulf state says it hopes to become the Silicon Valley of renewable energy.

So despite the often grim short-term forecasts, clean tech developers are confident they will win in the long term because energy demand will continue to soar once the economic recovery gets underway. And no one — including Middle Eastern oil producers — believes that fossil fuels alone will fill the gap.

At the Abu Dhabi conference, Germany's Deutsche Bank said $45 trillion had to be invested in alternative energy sources over the next few decades to balance fossil fuels and renewables in the global energy mix. This will require governments to put a price on carbon, backed up by strong incentives for investment in renewables.

As noted British economist Lord Nicholas Stern put it: "We've got to come out of this recession in a way that lays foundations for real sustainable future growth - not a (bubble), but something that really takes us forward."

So, if the politicos can remain focused during this downturn, there are strong hopes that the Obama presidency can kick-start a global green revolution that will put the world finally on a path to sustainability.

Larry Smith writes a column called "Tough Call" every Wednesday for the Bahamas Nassau Tribune. A former reporter and editor, he now operates a communications agency in Nassau -http://www.bahamasmedia.com. He also blogs at Bahamapundit.