Public-private partnerships aim to tackle diesel dilemma

Global Sustainable Electricity Partnership shows how governments can deploy renewable energy to protect valuable resources and stimulate economic growth

With their low startup costs, ease of operation, amenability to scale, and use of a common global fuel, diesel generators are slaking the thirst for electricity in emerging economies. However, collectively diesel generators contribute a heavy load to global greenhouse gas emissions, and that has emerged as an obstacle to climate change management as populations grow and the pace of development picks up.

Although more sustainable alternatives exist, new energy technologies typically require an investment in cash, user education, and supply chain that most small communities, and many governments, don’t have the resources to meet on a meaningful scale.

In the race to gain a foothold in developing global markets, that leaves clean energy companies at a clear disadvantage against diesel generator manufacturers and the diesel fuel supply chain. That gloomy picture (gloomy for clean-tech companies, that is) is beginning to change.

One step occurred in March 2012, when the United Nations established a mechanism for financing sustainable rural electrification projects through the Framework Convention on Climate Change.

This “top down” program is based on providing incentives to government. For a “bottom up” approach that complements the UN program, take a look at a new program of the Global Sustainable Electricity Partnership (GSEP).

The organization has its roots in a small 1992 consortium initially focused on hydroelectric development, spearheaded by utility companies based in France and Canada. By 2011, GSEP had adopted its current name and organized as a non-profit, having grown to include 14 leading utilities from 12 countries while embracing an expansive renewable energy focus.

The current lineup consists of American Electric Power (USA), Comisión Federal de Electricidad (Mexico), Duke Energy (USA), Électricité de France (France), Eletrobras (Brazil), Enel S.p.A. (Italy), Eskom (South Africa), Hydro-Québec (Canada), Iberdroia (Spain), JSC RusHydro (Russia), Kansai Electric Power Company Inc. (Japan), RWE AG (Germany), State Grid Corporation of China (China), and Tokyo Electric Power Company Inc. (Japan).

During the Warsaw Climate Change Conference in November, GSEP launched a new program to engage developing nations in public-private sustainable energy partnerships, as a collaborative venture with the UN Europe International PPP Center of Excellence and other key stakeholders.

The initial aim is to micro-target private sector renewable energy projects in communities where clean energy has a beneficial ripple effect, in order to provide governments with concrete proof that the adoption of low-emission and zero-emission energy can promote vital national interests aside from carbon management.

That could go a long way toward breaking down long running institutional obstacles to public-private partnerships in some countries. As a group, GSEP’s showcase of projects demonstrates how governments can deploy renewable energy to protect valuable resources and stimulate economic growth.

A direct-benefit approach is illustrated by a hybrid wind/diesel park in Ecuador’s Galápagos World Heritage Site. In operation for five years, the wind turbines help to reduce the risk of oil spills in this fragile environment while reducing costly petroleum imports.

Renewable energy projects can also contribute indirectly to national conservation efforts. For example, a portion of the proceeds from electricity sales for a small hydro project in the Philippines is earmarked for the Ifugao Rice Terraces World Heritage Site.

In addition, GSEP is showcasing linkages between reduced diesel reliance and improvements in local environment, economic and public health status, through a small biogas project for livestock farmers in Uruguay.

Livestock biogas systems collect manure in enclosed facilities, in which microorganisms digest the organic matter and emit methane-rich gas. Along with producing usable fuel, the digestion process converts raw manure into a stable material that can be safely and effectively used as a fertilizer.

These systems are becoming commonplace in the U.S., where they provide multiple economic benefits. In addition to reclaiming high value products (fuel and fertilizer) for the farmer, they virtually eliminate the cost of manure management and significantly reduce the impact of manure disposal, enabling farmers to avoid the risk of running afoul of environmental regulations.

Neighboring properties and businesses also benefit from the reduced impacts, specifically in regard to noxious odor. As for what bottom line benefit the GSEP members are getting out of promoting public-private partnerships, keep in mind that renewable energy lends itself to a micro-scale and distributed generation model that is already beginning to transform utility markets in developed countries.

Successful utility companies will develop ways to provide new products and services for the distributed market as it grows, and GSEP’s public-private partnership showcase could play a key role in promoting that effort.

Editor’s note: This is a guest post written by Tina Casey, senior reporter at CleanTechnica and TriplePundit.com. The views expressed in this post do not necessarily reflect or represent the views of ABB or its employees.