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François Xavier Boul Outlines Path to Tripling Renewables and Accelerating MENA Energy Transition

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François Xavier Boul Outlines Path to Tripling Renewables and Accelerating MENA Energy Transition

By François Xavier Boul

Vice President – Renewables 

How do you view the commitment at COP28 to triple renewables by 2030, in terms of its ambition?
The tripling target would bring global renewable energy capacity to at least 11,000 GW in six years. That’s a considerable number, but we’re well on our way, and the world added 50% more renewable capacity in 2023 than the previous year.

There has been a steady increase in renewable energy over the last few decades, and, if you look at this on a time graph, many cynics are extrapolating that growth and assuming that it will continue at the same rate. When you stand on a time graph, you can’t see what’s to your right, but it’s rapidly becoming a hockey stick graph with a huge upturn. It’s already begun, and the energy transition is exponentially growing.

We’ve gone far past the “if”, we’ve established the “how”, and we are now rapidly closing in on the “when”.

What will need to be done to meet this target, in areas such as investment, infrastructure development and supply chain? What do you think will be the main challenges?
Financial sustainability is crucial for accelerating the energy transition and achieving global renewable energy targets. Essential elements include policy support, investment in new processes, and consumer collaboration. These actions must address energy security concerns and rising anxiety about increasing energy prices, but the transition to cleaner forms of energy will significantly alleviate both of those things.

Crucially, this isn’t just something that rests solely upon the government’s shoulders. Analysis commissioned by the UN High-Level Climate Action Champions concluded that the private sector could deliver 70% of the total investments needed to meet net-zero goals.

It’s widely acknowledged that people respond to incentives. While the main incentive for the global population is to reduce annual emissions and create a healthy planet, the business world’s incentive is usually annual reports with a healthy bottom line. However, the financial motivations and rewards are increasingly apparent.

We hear about the cost, but people need to remember that most of those costs for renewable energy are front-loaded, compared to other traditional forms of energy production. The return on investment is potentially phenomenal. For example, green hydrogen could eventually become an addressable market worth US$10 trillion by 2050. And this forecast doesn’t come from a green think tank or sustainable energy company – it’s from Goldman Sachs.

Investors continue to flock to sustainable energy as the must-own asset of the future, and there has been a significant drop in the cost of renewables, now cheaper than coal, which, for decades, was considered the cheapest source of electricity. While solar got 89% cheaper and wind 70%, coal’s electricity price declined by only 2%.

In 2009, electricity from utility-scale solar photovoltaics cost US$359 per MWh, but that 89% drop is utterly transformative. In early 2009, the price of oil was US$40/barrel; if that had fallen by 89%, it would be US$4.40/barrel today.

At ENGIE, we are working to make the energy transition happen, but also in a way that is affordable and desirable for everyone. Doing the right thing for the environment has never been so profitable, and moving forward, it will only become more so. Challenges remain, of course, but every day at ENGIE, we face them head-on.

How do you view the MENA region’s energy transition achievements and prospects?
It’s perhaps ironic that because the region was the leader in oil and gas for so long, they are now in a strong position as energy experts to finance and facilitate rapid growth in clean energy. These programmes are among the most ambitious energy transition initiatives in the world.

The UAE has invested over US$40bn in clean energy over the last 15 years. It has plans to invest an additional US$160bn in clean and renewable energy sources over the next three decades on the road to net zero4. They’re also making a huge impact worldwide, contributing to renewable energy projects in 70 countries.

Likewise, Saudi Arabia aims for 50% of its energy to be generated from renewable sources by 2030, and the Saudi Public Investment Fund has financed around US$400bn since 2016 in alternative energy.

It’s worth noting that renewable energy investment in Egypt and Morocco has been significant in recent years, driven by ambitious renewable energy targets, favourable policy frameworks, and growing interest from domestic and international investors. Given the sharp drop in the cost of renewable energies, a strong growth still lies ahead.

Under that forward-thinking leadership of the regional governments, ENGIE has played a role as an independent water and energy developer with a portfolio currently producing 30.5 GW of power and 5.8mn m3 of drinkable water through desalination.

What is ENGIE’s involvement in the region’s renewable energy developments?
Because ENGIE has been in the region for over 30 years, we’ve been deeply involved in supporting many essential projects, and our asset portfolio is a testimony to that. We are scaling up our renewable teams in the region and our goal is to participate in all the government and public tenders. Our ambition is to be a key player in this area in the upcoming years.

The area I would like to highlight is less about the big utility scale projects, it’s related to our day-to-day energy efficiency and sustainable energy solution to our industrial customers in the region, which has a real and significant impact on energy consumption. After all, as the saying goes, the most cost-effective kilowatt-hour is the one we never use.

Our energy efficiency team at Masdar City reduced energy consumption by 30%. Al Zeina, the mixed-use development in Abu Dhabi, wanted to create a sustainable community, and thanks to our hot water pumps the energy consumption of their water heaters was reduced by 73%. We helped our client, Qatar General Electricity & Water Corporation, reduce carbon dioxide emissions by 10,300 tonnes per annum by installing 100 electric vehicle chargers with ENGIE Solutions’ systems. And there are many more examples.

Significantly, it’s not just governments we are working with. For many smaller companies, they lack the financial capability and technical expertise to implement viable schemes. By creating a technical, commercial, economic and legal framework, we can enable commercial partners to launch ambitious renewable energy projects to help an overall national contribution.

Globally, people are becoming frustrated by words and empty promises, so ENGIE’s whole reason for existing is to deliver progress step-by-step with pragmatism and reliability. You have to show people and companies why they can believe in a sustainable energy transition. I’m proud to say that we have been delivering on that promise.

Source:

WFES Dailies 2024

References:

International Energy Agency’s (IEA) Renewables 2023 report

https://www.gfanzero.com/netzerofinancing

https://ourworldindata.org/cheap-renewables-growth

https://www.zawya.com/en/projects/utilities/uae -to-invest-160bln-in-clean-renewable-energy-sources-in-next-30-years-yir4evoo

https://www.arabnews.com/node/1849981/saudi-arabia

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