Statement at APEF Business Forum
Delivered at UNCC in Bangkok, Thailand
Distinguished Business Leaders
Welcome to the APEF Business Forum. Senior policy makers have shared with their country specific energy scene and the strategy to reorient their energy systems and their plans to foster regional energy connectivity and integration. I outlined yesterday the centrality of the need to accelerate energy transition and what it would take to achieve SDG 7 to underpin growth, inclusivity and sustainability.
Engagement with private sector to ensure there is mutual understanding of how the private sector can lift the game to achieve the sustainable development goals whose success depends crucially on SDG7 given it’s a goals that has the power to integrate the economic, social and environmental considerations – the key element of the 2030 Agenda, Financing and Climate agreement.
The private sector is a key agent and player in any transformation process. The private sector has the potential to drive the energy transition forward through its 3 pronged strength, by which I mean innovation both in technology, business models and process; its ability to attract blended finance in the financing of complex and large energy transactions, given the not only the project finance risks, but also the design of modalities that can mitigate political implementation risks ranging from business environment to legal and regulatory risks.
It is in this context, this interaction among policy makers and the private sector has been structured to ensure markets are responsive to the opportunities available to them and for policy makers to better understand what it would take to unleash private sector expertise and resources. While financing for energy requirements may be overwhelming – by one estimate the financing gap is high as $750 billion per year1 - both global and regional savings and capital is available but has been hesitant awaiting risk mitigation. At the same time, the speed of the emerging fourth technological revolution lends us confidence that challenges can be dealt with as new technologies have surfaced but are likely to further unfold and, if mainstreamed, will be supportive of energy transformation effectively and efficiently.
We need to remind ourselves that three elements of SDG7 – renewables, energy efficiency and energy access are critical. They not only have impact on a stand alone basis, but they also reinforce each other. Already the private sector has been galvanized to invest, deploy technology and business models and finance to realize these three targets to deliver the demand for global goods, shareholders value and positive impacts for future generations. Our level of confidence in the private sector to invest in the renewables is growing but there are fewer investment-ready project finance proposals to enhance energy access and efficiency. More complex endeavors such as the transformation of Asia and Pacific Power Grids being capital intensive and engineering complex, spanning difficult and large geographical landscape with different legal and regulatory regimes and requiring more skillful multilateral negotiations to harmonize the standards for cross border power trading.
So here we are gathered to learn from the private sector how they are planning to build viable commercial models for energy investment and reinforce the supportive framework for the energy transition which calls for coordination of policy, technology and finance.
Forward looking policies can enable innovative technologies and financing solutions to tap the private sector potential effectively in transforming markets and societies. But at the same time, the emergence of disruptive technologies means new policies must evolve to anticipate their impacts and ensure even distribution of public and private benefits. Similarly, enabling policies are needed to mobilize public and private energy finance to sustain infrastructure development. And of course, without finance, the entire system will not function. In optimizing this complex system to drive the energy transition, multi-stakeholder engagement is paramount. Businesses can inform the policymaking process with their on-the-ground experiences and knowledge of emerging technology. Feedback from consumers, communities and markets are all valuable inputs for policymakers and regulators. They can also cooperate with governments on financing, to combine capital and risk mitigation through PPPs and other partnerships.
Joining us today, we have an impressive array of businesses at the frontiers of energy innovation. Trina Solar, represented by its CEO Mr Gao Jifan, is a global leader in photovoltaics, having added 32 GW of solar capacity to global generation since its founding. PTT of Thailand is a company which is embracing sustainability and investing in solar and biofuels. From Bangladesh we are joined by ME SOLshare, a cutting-edge company creating value for rural people by combining solar energy and blockchain. There are many other impressive companies on the ground across this region where the private sector is getting on with the job of creating a clean energy future. There are three key questions that I would like to offer for the consideration of this business forum:
- How can governments and international organizations partner with the private sector to support the energy transition?
- What are the cross-border opportunities for energy development and connectivity where the private sector can play a role?
- And finally, what do you see as the key bottlenecks preventing countries adopting sustainable energy pathways?
We want to use this as an opportunity to hear your perspectives on the energy transition and understand how we can build better private sector partnerships.
Ladies and gentlemen,
Focusing on opportunities embodied in transitioning the global energy system to a sustainable footing with appropriate weightage to growth, employment and new business ventures will be win win for ALL. Companies which are innovative, agile and can identify opportunities emerging from the shift to low carbon, clean energy can be the new energy disrupters but scale, speed and the pace and sequencing of transactions, given sovereign debt considerations, through technology convergence lends us optimism. Our region’s leaders, through the Paris process and the SDGs, have committed themselves to a low carbon future to keep the world within 2 degrees of warming and to a future where energy is cleaner and accessible to all. This provides a strong signal to business to work to deliver these solutions which will have long-term and deep markets.
I look forward to your perspectives and opportunities of public-private energy cooperation to shape the regional deliberations of our leaders and bring us all closer to the energy future we want.
1Policy Brief on Financing for SDG7 https://sustainabledevelopment.un.org/content/documents/17549PB_5_Draft.pdf