6 December 2011: The International Renewable Energy Agency (IRENA) and the International Institute for Sustainable Development (IISD) have organized a workshop for journalists on “Barriers to Renewables – What Are They and How Can They be Overcome.” The workshop took place on the sidelines of the Durban Climate Change Conference, and examined ways to overcome barriers to renewable energy, including issues such as the regulatory environment for renewables and finance costs.

Kirsty Hamilton, Chatham House, stressed the importance of examining the barriers faced by financiers when deciding whether or not to invest in particular renewables projects, as well as how investors assess risks and returns. Recognizing that country and currency risks are relevant to all types of investments, she called for a focus on those risks that are particular to the renewables sector. Hamilton underscored the role of governments, regulators and utility companies in managing the entire regulatory environment around how renewables were built, connected and sold. She concluded by stressing that getting the right policy environment was a better approach than using public finances to bring costs down.

Christopher Clarke, Inspired Evolutions, stated that the role of financing firms in the renewables sector was to make a competitive return and produce a societal benefit. He noted the high rejection rate for project proposals and a lack of capacity among potential renewable energy suppliers. Clarke underlined that the whole regulatory environment needed to be in place, not only the public energy policies.

Silvia Kreibiehl, Deutsche Bank, outlined the relevant factors and risks driving the decisions of finance firms whether or not to invest in renewables projects. She highlighted factors that increase costs in developing countries, such as risks related to technology, currency, the political context and regulations. She called on governments to provide transparency, longevity and certainty in the regulatory environment in order to make renewables projects viable.

Peter Wooders, IISD, discussed IRENA’s work to bring renewables readiness assessments to developing countries for all renewable energy types (including transport biofuels), for both on- and off-grid energy production. He explained that IRENA aims to assess the current situation on renewables in particular countries, identify the key obstacles to overcome, and categorize where there is potential to use renewables as a source of energy. He highlighted the example of Senegal, where the deployment of hydropower is complicated by the fact that international agreement would be required with several neighboring countries, but where on-grid solar had excellent potential.

Laura Antoniazzi, ICONE, discussed Brazil’s experience with sugarcane ethanol, highlighting issues such as direct and indirect land use changes, and the consequences of sugarcane being used as a biofuel feedstock rather than as a food source. She emphasized that the supply of sugarcane ethanol had decreased in recent years and that the Brazilian Government had lowered its mandated level of ethanol in gasoline. [IRENA Website on the Media Workshops] [IISD RS Sources]