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Good practice analysis: Analytical framework and first
results
Klaus Jacob, Holger Bär
Environmental Policy Research Centre
Rabat, GIZ SE4JOBS Workshop, March 25th 2015
Goals
• Analysis of good practice countries
regarding:
- Markets for technologies for renewable energy
and energy efficiency
- Domestic creation of value
- Employment
- Strategies and policy instruments
• Analysis of causalities
• Analysis of transferability
Green Jobs and Jobs in a Green Economy
• Difficulties to define Green Jobs
- Outcome versus process perspective,
- environmental technologies versus environmental friendly
technologies
- Sector based versus economy wide assessments
• Lack of data
• Evidence for positive gross effects
- Result of higher employment intensity
- High shares of Green Jobs (e.g. Bangladesh 7%, Mexico 4,5%)
• Net effects contested
- Opportunity costs of green technologies
- Lack of consideration of costs of environmental degradation
- Optimistic BAUs
- Findings depend on assumptions on source of financing
Further
reading:
Policies for RE and EE Markets
• Policies to enable markets and employment:
- Supply side instruments: Innovation and
investments,
- Demand creating instruments,
- Policies for infrastructures and market
mechanisms
Policy mix and policy integration
Strategies + Strategic process
Transfer of Policies – generic model
• Policies depend on framework conditions
policy instrument
country
framework condition 1
3
framework condition 8
2.5
2
framework condition 2
1.5
1
0.5
framework condition 7
0
framework condition 6
framework condition 3
framework condition 4
framework condition 5
Are these framework conditions present in adopting
countries?
Example South Africa’s REI4P
REI4P
country
admin. capacity to
administer
5
4.5
competitiveness of
RE electricity
4
3.5
3
2.5
access to capital for
investors
2
1.5
1
0.5
0
supply of projects
clear legal
framework
large-scale
developers
human resources in
workforce
Selection of good practice countries
Criteria:
• Emerging economy
• Relative market size of RE or EE technologies
- Installed capacity of RE technologies and capacity under
construction
- pace of market growth in these markets & project pipelines
- Energy intensity of industry
• Or: Employment in RE / EE
- However: Lack and often poor quality of data
 Or: Strategies in place
 Turkey, India, China, Mexico, South Africa, Brazil
 Second series of countries to fill specific knowledge
needs
Installed RE capacity in MW/ million inhabitants
80
70
60
50
40
30
20
10
0
201120122013
Brazil
201120122013
China
201120122013
India
Solar PV
201120122013
Mexico
Wind - onshore
201120122013
South Africa
Geothermal
201120122013
Turkey
201120122012
World
Energy intensity in 2011 and change (2000-2011)
Country
Energy intensity Annual improvement
in 2011
of industrial energy
(EU=100)
intensity (20002011)
Turkey
67
2,5
Mexico
65
2,5
Brazil
213
0,0
India
192
1,6
China
234
1,9
South Africa
215
1,0
Selection of Cases: Employment
• China: 350.000 Jobs in wind energy, 1.6 Mio jobs
in PV,
• Turkey: 81.000 Jobs in wind energy
• Brazil: 32.000 Jobs in wind energy, 30.000 in PV,
12.000 in hydropower
• India: 110.000 jobs in PV
• South Africa: 15.000 jobs in PV, 3600 jobs in wind
energy
 Lack of data in Energy efficiency and for many
countries
Analysis of good practice countries
• What is the outcome?
- E.g. development of RE capacities and employment over time
• What are the systemic conditions?
- E.g. Natural conditions, political system, financial system,
socio-demographic situation
• What strategies are in place?
- E.g. Goals, horizontal and vertical coordination, participation,
work program, capacities, evaluation and monitoring
• What policy instruments have been adopted?
- Supply, demand and market mechanisms including framework
conditions
• What is the outlook?
- Expected development of markets & local employment
Approach to data
• Evidence is based on different sources of data:
- International data banks on policies, markets &
employment;
- National policy documents: strategies, laws;
- Scientific literature (based on keyword search science
direct and meta studies).
• Core sources are pre-selected and evaluated by
GIZ country experts to ensure completeness
• Interviews with GIZ country experts
Turkey
• Why is Turkey a good practice:
- Very significant market for wind and geothermal energy +
very high investments in these markets in recent years
Why is Turkey a good practice?
• Development of installed RE power capacity in Turkey, in MW
Employment:
Wind: 81.200 (EWEA 2012)
Solar: 400 (IEA-PVPS)
Geothermal: no data
Energy intensity (industry):
67% of EU
2.5% annual improvement
Turkey
• Why is Turkey a good practice case:
- Very significant market for wind and geothermal energy +
very high investments in these markets in recent years
• Framework conditions
- Natural conditions
- Fast growing demand for electricity
• Strategies
- Horizontal coordination including civil society stakeholders
• Policy instruments
- Feed in tariff + local content premiums for components
- Subsidies for EE investments
• Outlook:
- Very strong growth in electricity demand (7% p.a.) drives RE
investments
South Africa
• Why is SA a good practice case:
- Installed capacity relatively small, but enormous amount of
capacity under construction under the REI4P system
Why is South Africa a Good Pracitice?
• Installed wind and PV capacity in South Africa, in MW
Employment:
Wind: 3600 (SA government 2012)
Solar (PV+CSP): 15.400 +1.900 (SA government 2012)
South Africa
• Why is SA a good practice case:
- Installed capacity is small, but enormous amount of capacity
under construction under the REI4P system
• Framework conditions
- Banking and finance system & fast rise in electricity prices
• Strategies
- IRP as living strategy with extensive public participation
• Policy instruments
- Auction scheme with local content requirements
South Africa: competitiveness of new RE vs. new coal
South Africa
• Why is SA a good practice case:
- Installed capacity is small, but enormous amount of capacity
under construction under the REI4P system
• Framework conditions
- Banking and finance system & fast rise in electricity prices
• Strategies
- IRP as living strategy with extensive public participation
• Policy instruments
- Auction scheme with local content requirements
• Outlook:
- High expected growth in electricity demand (5,4% p.a. till
2030); RE very soon competitive with investments in fossil
energies; estimated nearly half a million green jobs by 2025,
80.000 of which in RE, 68.000 in EE
Mexico
• Why is Mexico a good practice case:
- Significant growth and investments in wind & PV
- EE improvements (e.g.-2,5% p.a. industrial energy
intensity)
Installed RE capacity in Mexico
Energy efficiency industry:
65% of EU
2,5% annual improvement
Employment:
Wind: 1500
Solar PV: 100
Mexico
• Why is Mexico a good practice case:
- Significant growth and investments in wind & PV
- EE improvements (e.g.-2,5% p.a. industrial energy intensity)
• Framework conditions
- Proximity to USA  RE exports
• Strategies
- Long-term and short term-planning through the RE & EE Strategies
(15 years) and Special programs (4-5 years)
- Participation through advisory councils
• Policy instruments
- Tax deduction up to 100% for RE investment
- Energy efficiency subsidies for low income households
• Outlook:
- Very high growth rate in wind sector anticipated
- Greening the economy could lead to net gain of 730.000 jobs
Frequent observations
• Co-Evolution of policies, technologies and private
sector
• Importance of
- Participation in strategy development and implementation
- Coordination within government
- Financing
- Human capacities
- Provision of local content
- Access to grid
MENA country analysis
• Support schemes
- Good Practice South African Auction Scheme?
• Energy Transformation
- Good Practice Turkeys Regulatory Agency?
• Energy Efficiency
- Good Practice Mexicos Subsidies for low- and middle income
households?
• Training
- Good Practice South African Energy Training Center?
• Other issues?
- Local content?
- Private sector development and participation?
Towards a Toolbox: Support Scheme
• South African auctioning scheme for RE capacity
• Framework conditions:
- Country’s extensive experience with public private
partnerships
- developers capable to shoulder high entry costs of REI4P
- Functioning banking & capital market
- Cost-competitiveness of RE with new conventional power
Towards a Toolbox: Training
• Public-private cooperation in providing training in
RE: SA Renewable Energy Training Centre
• Framework conditions:
- Joint project of government (Dept. For Higher Education, SA
National Energy Development Institute), host university
(Cape Peninsula University of Technology) and national and
int‘l RE businesses
- Funding and participation from businesses in designing
training programs
- Different long- and short-term programs covering wind & PV
Analysis of good practice countries
• Outcomes:
- Analytical framework including selection of countries and data
sources
- Draft studies for
- Turkey (pilot case)
- South Africa
- Mexico
• Outlook:
• India
• China
• Brazil
• Additional data
• Thanks for your attention
Questions – Issues – Options
1. Assessment
Natural conditions
- Technologies
- Markets
-
6. Coordination
7. Participation
8. Supply
 Finance
2. Co-benefits
 Human Resources
 Social
 Environmental
 Economic
3. Trade Offs
4. Goals
5. Responsibilities
 Planning and permitting
9. Demand
10.Markets

Access to grid
11.Evaluation and
Monitoring
Toolbox: Strategies
• Description of Strategies:
- Goals
- Horizontal and vertical coordination
- Participation
- Work program
- Capacities for implementation
- Indicators, evaluation and monitoring
• Taxonomies?
- Policy domain?
- Country?
Toolbox: Policies
1) Short summary description of policy instrument
including necessary framework conditions
2) Schematized description
-
Policy instrument and mechanism
-
Functions and entry point
Policy domains
-
3) Systematic description of framework conditions
-
Administrative capacities
Economic capacities
Infrastructures
Political framework
Financial requirements
?
4) References
Toolbox: Assessing Employment
• Methods for assessing employment
- Definitions and glossary
- Data
- Gross effects
- Net effects
- Modelling (description and applications)
- CGE
- Partial equilibrium
- Econometric
- System dynamics
- Microsimulation