Stronger Efforts Are Needed to Achieve SGD 7 Sustainable Energy Goals

The United Nations recently released the Tracking SGD 7: The Energy Progress Report 2022. The report comes in the context of growing concern about the global economy due to war in Ukraine, continuing impacts from the global covid-19 pandemic, rapidly increasing global energy and food prices, disruptions in global supply chains, slowing capital investment in developing countries, and questions about countries commitments to climate change targets.

The report’s headline conclusion is “At today’s rate of progress, the world is still not on track to achieve the SDG 7 goals by 2030.” The report’s dashboard (see below) indicates that although progress has been made since 2010 on the four SDG7 goals of electricity access, use of clean cooking fuels, renewable energy, and energy intensity, international public financial flows to clean energy have fallen. The most positive development is the growing policy support and investment in renewable energy which has been further stimulated by the global energy price spikes and security of supply concerns. Even with the major additions of renewable energy capacity additions over the past decade, renewable energy only accounted for only about 17.7% of final energy consumption in 2019. The recently released BP Statistical Review of World Energy 2022 estimates that global electricity generation from hydro (15 percent) and other renewables(12.8 percent) together constituted 27.8 percent of global electricity generation in 2021 and non-hydro renewables grew worldwide by 16.5 percent over 2020. Renewable energy capacity in developing countries more than doubled from 2010-2020 from 102 watts per capita to 246 watts per capita; but additions tended to be concentrated in a relatively few developing countries. Significant increases in renewable energy and reductions in energy intensity will be needed to realize the IEA’s scenario of net zero emissions by 2050. The new IEA energy efficiency report estimates that raising annual energy efficiency improvement from 2 percent to 4 percent per year could reduce CO2 emissions by 5GT by 2030, or a third of the required reduction by 2030 in the 2050 net zero scenario.

Electricity access has increased from 91 percent from 83 percent in 2010, reducing the population without access to an estimated 733 million in 2020. Given substantial improvements in South Asia, Sub-Saharan Africa is becoming the key area for improvement, in both electricity access and clean cooking fuels. Sub-Saharan Africa had 77 percent of the global populations without electricity or 568 million people. “The largest unserved populations are in Nigeria (92 million people), the Democratic Republic of Congo (72 million), and Ethiopia (56 million).” Decentralized solar home systems and mini-grids continued to be adopted but the economic impacts of covid-19 and increased problems of affordability have slowed investor deployment efforts. Progress in providing clean cooking fuels has been especially slow. With 31 percent of the global populations using biomass and coal, the health impacts continued to be a major concern, with a direct linkage to over 2.5 million premature deaths per year. Greater priority is clearly needed to address this problem, which has also been seriously affected by the pandemic.

COP26 saw a marked increase in commitment and engagement by private sector companies and financial institutions. The private sector role in financing renewable energy systems in developing countries is critical and represented 85 percent of capital investment in renewable energy projects between 2013-2018. But the financing tends to be concentrated, with 24 countries receiving 80 percent of the financial commitments in 2019. The least-developed countries only represented a quarter of the flows.

The World Bank’s recent warning about the potential for global economic stagflation and slower growth in the emerging and developing countries over the next several years adds to the concerns about inadequate progress towards SDG goals in energy and other areas. Clearly more innovative financing and public-private partnerships efforts are needed to tackle the serious problems facing the emerging and developing countries.

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