Renewables Fill the Power Gap

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Marco Werman speaks with Chris Flavin, president of the Worldwatch Institute about the rise of solar and wind power in developing countries. Flavin says green power is an attractive alternative to unreliable service from the electric grid.

MARCO WERMAN: What's happening in Pakistan reflects a larger trend in renewable power in much of the developing world. Solar and wind are starting to take off. But not the way many green visionaries had imagined. Environmentalists have long encouraged governments to push big investments in renewables. They saw it as an important top-down way to avoid pollution from new coal-fired power plants. But Chris Flavin, president of the Worldwatch Institute in Washington, DC, says that instead, wind and solar are often rising from the bottom up, to fill a gap in the electricity market.

CHRIS FLAVIN: We're starting to see this more and more. The combination of the inadequacy of the conventional power supply in many countries and it's very common throughout the Indian subcontinent. That combined with the very substantial increase in oil prices, since diesel generators are commonly the backup if you don't have the grid. The combination of those two things as well as the significant improvement in solar, wind and other technologies are really now leading to a real takeoff in this around the world.

WERMAN: Do you have any numbers on that? I mean how many individuals like Sarwar, whom we just heard from, are responding to the call for renewables?

FLAVIN: There are no comprehensive global numbers out there, but I think it's clearly in the millions of households. In Kenya alone it's estimated that there are about 300,000 small solar systems in place. In fact, they're more people getting new power each year from solar than get it from good extension in Kenya. So, it is really starting to become quite widespread. On a global basis, this is clearly a relatively modest share in the total energy supply, but I think there's good reason to think that five or ten years from now, the picture may look very different and a true leapfrog may begin to take hold in many parts of the world.

WERMAN: So what do you think needs to happen for the market, for solar and other renewables, to really take off from here in places like Karachi? I mean are there things that governments can do other than making big investments themselves?

FLAVIN: The first critical thing is the technologies themselves continue to improve and that the price continue to decline. I think there's a good reason to be optimistic there and we're seeing literally 50% growth rates in the solar industry worldwide. That's already driven down cost by 40 to 50% just in the last year and a half. I think government to a large extent simply has to get out of the way, get out of the way in terms of getting rid of the tax subsidies for fossil fuels. But beyond that I really do think that the private sector has a very large role to play, in particularly the advent of microfinancing has been they key because with conventional power or even with a diesel generator, you basically sort of pay as you go. With solar there's no ongoing operating cost, but there is a very substantial upfront investment, so you need to figure out a way to provide financing just the way we buy a house so that you pay for it gradually. I think that's really one of the key things to get this going as a really viable business.

WERMAN: In rural areas it's a pretty different picture where you might not even have a power grid to begin with. You've been kind of seeing lots of opportunities for this leapfrogging idea to take hold in rural areas. Is it starting to happen?

FLAVIN: It is and the example of Kenya, I think, is probably one of the best although there are many other instances including a lot of development in South Asia, Bangladesh, parts of India, Sri Lanka as well.

WERMAN: Are you saying that the Asian subcontinent could in ten years potentially be ahead of the United States in terms of renewables?

FLAVIN: Well, China actually already leads the world in renewable energy development. Now China has both the largest wind and solar market and is now at the point where it's beginning to become not just a major manufacturer but also an exporter as well as a significant innovator in the technology. This is clearly important in terms of the potential for China gradually to shift from its huge dependence on coal, but beyond that what China is doing is going to make low-cost technologies available literally around the world, that will make it much easier for other countries to accomplish a similar leapfrog.

WERMAN: Chris Flavin, president of the Worldwatch Institute, speaking with us from Washington. Thank you.

FLAVIN: Thank you.