India and France pledge billions of dollars on solar energy

Cash will help lower the cost of solar technology in developing countries.
A solar power panel on the roof of a home in Bangladesh

New projects aim to reduce the cost of solar technology in developing countries.Credit: Majority World/UIG/Getty

India and France have committed more than US$2 billion to fund solar-energy projects in developing countries. Renewable-energy analysts say that the money has the potential to dramatically expand solar technology in these nations, but others argue that governments should instead focus on removing barriers that slow the growth of renewable energy.

The announcement came on 11 March during the first summit of the International Solar Alliance (ISA) in New Delhi, which drew heads of government from more than 20 countries. In his opening address, Indian Prime Minister Narendra Modi pledged $1.4 billion to support solar-energy projects in Bangladesh and in developing countries in Africa. French President Emmanuel Macron committed €700 million (US$865 million) to the scheme.

“Pledges of $2-billion-plus are quite significant,” says solar-policy analyst Ashvini Kumar at the Energy and Resources Institute, a sustainable-development think-tank in New Delhi. “A number of programmes can be launched and sustained with this,” he says.

Solar technology for developing nations

The intergovernmental ISA was launched by Modi and former French President François Hollande at the United Nations climate conference in Paris in 2015. The alliance seeks to lower the cost of solar technology so that it can meet the energy needs of 121 sunshine-rich developing countries. It aims to create 1 terawatt (1,000 gigawatts) of solar energy by 2030. So far, 61 countries have joined the alliance and 32 have ratified its framework agreement.

Modi told the summit that India’s $1.4-billion pledge would be used to support 27 new projects in 15 developing nations. Projects will range from setting up small solar photovoltaic power plants in several African countries to a 100-megawatt solar photovoltaic plant in Mollahat, Bangladesh, and an LED street-lighting project in the Seychelles.

Investment call

Macron, who has positioned himself as a climate crusader, told the summit that the alliance needed $1 trillion to achieve its 1-terawatt target by 2030. Macron’s pledge of €700 million brings France’s total investment to €1 billion. The country committed €300 million in 2015.

The World Bank has also pledged $500,000, and other agencies, including the Green Climate Fund, have offered to support the scheme, but most of the investment is expected to come from the private sector.

The alliance has three main programmes: promoting the use of solar water pumps instead of diesel pumps for irrigation; affordable financing for solar technology; and promoting solar mini-grids in the least-developed countries and small island nations. The 13 projects already under way include initiatives to bring electricity to villages in Niger, to install street lighting in Sierra Leone and to supply solar-powered lamps in the small South American nation of Suriname.

Some analysts say the commitments by India and France will have a relatively limited impact on the amount of renewables installed globally. Renewable-energy engineer Andrew Blakers at the Australian National University in Canberra says that the latest investment represents a small fraction of the several hundred billion dollars of private money that will be spent on solar and wind technology around the world this year. A couple of billion of dollars to help deploy the technology “is neither here nor there”, he says. Although Blakers sees great value in the alliance’s micro-finance schemes in developing countries.

Removing obstacles

To hasten the global expansion of solar energy, Blakers argues that governments should focus on removing regulations, such as fossil-fuel subsidies, that deter private-sector investment in renewables. “The private sector can provide the money, it’s government getting obstacles out of the way that counts,” he says.

Blakers says government should also spend more money on solar research and development, which could continue to drive down the price of photovoltaics, he says. According to the International Renewable Energy Agency, headquartered in Abu Dhabi, the cost of the technology has fallen by 73% since 2010.

Kumar says that the latest investments will also help to boost research on battery storage and advanced solar cells. At the summit, Modi launched a solar-technology initiative to encourage Indian institutions to pursue solar research.

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