Blogs, Energy Efficiency, Geothermal, Hydropower, Solar, Wind Power

IEA Singing a New Tune

The International Energy Agency has not always been seen as a stalwart ally of renewable energy. The organization was formed in 1974 after the first oil shock as a fossil energy consumers union in order to balance the weight of OPEC.

Because of this history, the IEA has consistently underestimated the role that renewables will play in the global energy mix. Some say the organization has treated clean energy as nothing more than a curiosity. But that is changing.

With the leadership of Executive Director Nobuo Tanaka, there are now some green shoots growing out of the IEA’s brown roots. ::continue::

The organization was formed out of a crisis. Now, the onset of the global climate crisis has caused the IEA to reinvent itself as a supporter of renewable energy. I had the chance to sit down with Mr. Tanaka at the Renewable Energy Finance Forum in New York City today and talk about the changing role of the IEA. Nobuo Tanaka, Executive Director of the IEA

“We are saying that this is a huge business opportunity in renewable energy, energy efficiency, demand-side management…so we are now asking our members to study their policy portfolio and much more friendly policies…which fit with the maturity of the industry,” said Mr. Tanaka.

Mr. Tanaka is also very optimistic about the IEA’s relationship with the International Renewable Energy Agency (IRENA), an up-and-coming international organization that will take a much more active role in assisting member countries with the development of clean energy.

IEA focuses mainly on OECD countries. The organization does very limited work with developing countries. Because two-thirds of emission reductions will come from developing countries, said Mr. Tanaka, it will be extremely important to have another agency that can work in that area alongside the IEA.

“IRENA has the strengths of helping developing countries deploy these technologies in a different context…Our input of analysis and data collection and our policy analysis in developed economies can help. So we could have a good cooperation and a good synergy.”

Other onlookers seem to agree that the IEA’s new attitude is a very positive step for the industry. Michael Liebreich, Chairman and CEO of the financial consultancy New Energy Finance (NEF) agrees. His firm has been working closely with the IEA in order to expand their reports on renewables.

“I’m enormously heartened to see the changes in the work done by the IEA over the last three years. I think it’s an enormous testament to Mr. Tanaka. I’ll be honest – I’m surprised the extent to which the IEA has encompassed the climate change and clean energy agenda.”

That’s good long-term news. But in the short term, the clean energy industry is still in a difficult period. The IEA – along with NEF – is reporting that we could see a 38% dip in global clean energy investments this year. That could mean around $130 billion is invested world-wide.

In order to really start combatting climate change and keep greenhouse gas emissions below 450 ppm, we’ll need to see more than $400 billion in total investment each year, according to NEF. While quarter one of this year may be the bottom of the slowdown, it’s going to take a lot to reach such high investment levels in the coming years.

“It takes a great deal of ground work to reach that level of investment. But it will happen – the drivers are there,” said NEF’s Liebreich.

The IEA’s support of renewables is one of those drivers.