1. Sustainable development: the renewable energy mandate

The Asia Pacific region, among the world's most populous and diverse, includes many of the world's communities that are most at risk from catastrophic events brought about by climate change and other fossil-fuel consumption related impacts. The region needs a coherent and effective framework for sustainable development - which inevitably has to mandate the rapid deployment of renewable energy and energy efficiency policies and practices.

The World Council for Renewable Energy (WCRE) calls for the urgent development and enactment of such a framework. It is ready to assist governments and inter-governmental organisations in the energy policy formulation process as well as in the adoption of specific sustainable energy strategies. Such strategies are to reinforce existing sustainable development efforts, pursued in the region by national, provincial and municipal governments, a number of aid and lending institutions and a large number of non-governmental organisations.

Most present development programs are still far too reliant on fossil fuel or nuclear based projects. Furthermore, regional development policy signals set by many leading countries are frequently coloured by short-term resource extraction and trade objectives with too little regard for local and global sustainability. The local viability of the poorest nations and indigenous communities remains severely under-recognised.

Renewable energy applications in the Asia Pacific region - when delivered as sustainable solutions that respond to local environments and communities - are essential to deliver genuine results on Millennium Development Goals and all five World Summit on Sustainable Development 2002 (WSSD) development imperatives:

• water: sustaining communities and industry without waste or pollution;
• energy: generated from clean, renewable sources;
• health: ensuring clean water, air and sanitation;
• agriculture: renewable base with sustainable forms of irrigation;
• biodiversity: elimination of habitat destruction, such as energy poverty induced deforestation practices, or water depletion and contamination in fossil and nuclear power generation.

2. Regional characteristics and needs

The Asia Pacific region is typified by a set of special features, all important in developing renewable energy policy and action. Most significant among these is its great diversity, both within and among all of its countries: the people of the region speak thousands of different languages and are home to many indigenous communities. On the one hand the region is marked by great isolation of and distances between many communities, especially of the Pacific; and on the other by the presence of the densest and most populous urban agglomerations of the world, such as in China, Japan or Indonesia. The region also features a sharp and structural divide between and within countries along rural-urban, and centre-periphery lines. And despite relative geographic proximity and intensive trade, political and kinship links, progress towards sustainable development is severely hampered by an absence of a comprehensive regional policy framework on renewable energy.

The development profiles of rural and urban communities vary greatly, hence sustainable energy responses need to vary greatly as well. Three main types of environmental afflictions stand out in communities ranging from the poorest to the most wealthy.

• Poorer, rural and isolated communities experience problems with local health, basic sustenance and income generation, much of it due to acute levels of energy poverty, ie a lack of ready access to locally generated, affordable and easily replenished power and fuel.

• More developed countries with accelerating urban economies struggle with fossil-fuel induced local air, water and soil pollution.

• The major challenge of countries, regions and cities enjoying increasing wealth and consumption has become a massive and dangerous greenhouse gas emissions surplus, largely due to massive levels of fossil fuel use.

Across the region, climate change, future fossil fuel supply, and concomitant economic, environmental and regional security risks are broadly acknowledged by governments as a significant and immediate threat to the international community. As one example, most island and coastal nations are directly at risk from sea level rise.

For the emission debtor nations - those with a surplus of greenhouse gas emissions above set targets - significant reductions in greenhouse emissions through a curtailing of reliance on fossil fuel and other compensating measures are required, while for the emission creditors - largely less developed regions below their national emissions limits - it is important to secure local livelihood, sustainable and sustained forms of income generation.

3. Renewable energy and energy efficiency: key to sustainable development

Renewable energy is one of the few means by which significant cuts in greenhouse emissions can be made, utilising existing proven technology. Renewable energy currently accounts for a relatively small amount of energy supply with technologies such as wind and solar only beginning to emerge. Renewable industry capacity, institutional capability, equitable pricing and levels of policy commitment need to be dramatically increased in order to build renewable energy markets and deliver the resultant cost reductions that come from economies of scale. Renewable energy has also the ability to deliver a number of social objectives - particularly for developing economies where it can play an important role in alleviating poverty and improving livelihoods for the two billion people in the world that do not presently have access to electricity - many of whom live in the countries of the Asia Pacific region.

Energy efficiency will play the major and corollary role in achieving regional energy sustainability. It, too, needs to be supported through strong government policy action. Energy efficiency reduces the effective cost of renewable energy and combined renewable energy and energy efficiency measures are a cost effective greenhouse reduction mechanism in developed and rapidly developing economies at present.

4. Renewable energy industry capacity and capability building

The WCRE urges regional governments to embrace the following policy imperatives.

• Establish binding, significant and growing renewable energy targets and other market development mechanisms. An effective legal structure is required to deliver investor certainty, underpinning the significant investment that will be required to grow the renewable energy industry. Renewable energy certificate trading, feeder laws and/or other uptake assurances are critical for accelerating market development, and for effective carbon trading arrangements.

• Remove fossil fuel subsidies and other market distortions. Massive financial subsidies are being paid annually to the production, distribution and use of fossil fuels, globally and throughout the region. These need to be phased out.

• Incorporate a carbon price signal into the energy market. The investment, purchasing and operating decisions made of energy consumers mean that the environmental cost of using fossil fuels must be factored into real energy prices.

• Ensure open and equitable market access. It is essential that access to markets and electricity grids by both renewable energy generators and consumers is guaranteed on all levels.

• Build community commitment and support for renewable energy. Citizens and consumers need to be made aware of the (i) adverse environmental impacts of the continued use of fossil fuels and (ii) environmental and social benefits that renewable energy can provide.

5. Policy initiatives for the developing countries in the Asia Pacific region

The WCRE Asia Pacific urges the implementation of the recommendations of the World Bank Extractive Industries Review final report "Striking a Better Balance" as they relate to renewable energy, specifically to

• assist governments to adopt sustainable energy strategies that address the energy needs of the poor and minimize externalities such as climate change;

• internalise the cost of greenhouse gas emissions into all World Bank Group (WBG) economic decision-making;

• increase investments in sustainable energy resource development. This includes setting targets for increasing proportions of investment in renewable energy within the energy portfolio, increasing annually at 20 per cent (up from 6 per cent of investment) to achieve a better balance with support for other projects;

• phase out lending in fossil fuel projects over time and

• implement initiatives for technology transfer related to climate change and further research into appropriate technology.

In addition, the WCRE urges regional governments to

• build local renewable industry capacity and capability so as to deliver the social and economic benefits that renewable energy can provide;

• support tariff free renewable energy trade and technology transfer;

• offer loans for renewable energy technology dissemination programs through private entrepreneurship; these will not only create decentralized electricity companies in non-electrified areas but also produce income generation opportunities; and

• enforce a strict split between aid program funders and providers such as executing agencies and consultants. Specific solutions must be offered competitively, not be technology pre-determined and must meet stated sustainability aims on a locally appropriate basis. Appropriate renewable energy industry sustainability protocols are needed to achieve this.

6. Need of Pacific Islands; of less developed and rural communities of the Pacific and Southeast Asia; and of remote native communities of Australia

There are specific measures required for Pacific Island and other communities with remote, rural and community-life based characteristics. These need to be responsive to different institutional structures of often small communities, and also recognise that many of these groups and nations will be most adversely affected by climate change. Indeed many coastal areas and habitats will cease to exist or dramatically diminish in size and viability unless decisive actions on greenhouse gas emissions are taken. These measures also must address the important social outcomes that renewable energy can provide in addressing poverty alleviation and building sustainable income bases for remote and rural communities, as per the WSSD plan of implementation.

The WCRE urges regional governments and regional donors to

• support more flexible and pragmatic funding arrangements that address diverse institutional, legal and support structures;

• support renewable energy installations that produce local income;

• support local business networks, and non-government institutions that have demonstrated a track record in sustainable renewable energy supply;

• recognise the gender-energy nexus that is universally apparent in developing nations, but is particularly critical to sustainable efforts in the Pacific Islands;

• perceive communal links to land and resources as a positive tool for energy system sustainability, encouraging models that allow full community ownership and management on customary land;

• recognise that 'capacity building' often needs to be accompanied by positive schemes supporting up to 60% of capital costs for energy systems that can build social cohesion and markets through universal access and a level of income generation within the project; and

• ensure that development aid project cycles are of sufficient length to meet their aims while remaining useful for timely implementation needs.

7. Reform of bi- and multilateral arrangements to ensure timely change and local appropriateness of development aid programs

Given the WCRE's strong support for the World Bank Extractive Industries Review recommendations (see 5) it is also urgent that other lenders and direct aid organisations terminate or transform those funding programs biased towards fossil fuel based aid so as to reallocate support towards renewable technology and efficiency programs.

The sustainable development and energy initiatives that do exist are in urgent need of review and reform as well. Indeed, many existing frameworks - such as the Kyoto Protocol Flexibility Mechanisms, the Global Village Electrification Project, Millennium Project Guidelines, and some World Summit on Sustainable Development 2002 (WSSD) Type II initiatives - are insufficiently flexible to respond to local needs and are typically underpinned by inaccessible credit based financing. Programs such as the Global Village Electrification Project (GVEP) are unable to reach many communities, have varying institutional arrangements, and a lack of accountable delivery mechanisms.

These existing global mechanisms and policy frameworks need to be revised and adapted to the specific needs of the Asia Pacific Region, by being incorporated into local programs of self-determination in project definition, broader development geared and income generating efforts and keenly focused on actual needs and local capacities. Indeed, the GVEP and similar programs need a specific window for the vulnerable Pacific Island Countries (PIC's), whose remote and very thin market contexts are ill-suited to existing indicators.

The WCRE calls on the European Union (EU) and other carbon market operators to recognise Kyoto compliant states in the Asia Pacific region and allow for bilateral trading mechanisms to operate between the EU and these states.

8. Industry and technology: emphasis on appropriate socially, environmentally and economically appropriate renewable energy solutions

The renewable energy and energy efficiency industries comprise numerous sectors. As stressed above (5), outcome-led, based on locally led program and project definition efforts, competition between various technology solutions is necessary to ensure that least social and environmental cost solutions evolve over time. This means that there is a need for solutions that are not merely low cost but also integrated, appropriate and locally sustainable. Low cost approaches do not of themselves lead to sustainable outcomes when, for example, local income generation and retention are discounted by a least cost approach. It is also essential that incentives be provided for owners of technology to collaborate, to ensure that the most appropriate and measurably sustainable environmental, social and economic outcomes are achieved at local level. Therefore, a truly least cost competitive framework must specify an energy service which realises both social and environmental objectives.

This will often mean the composition of a connected 'symphony of renewables', played out in preference over short term economic gain for single technology outcomes.

9. Urbanisation and renewable energy

The WCRE supports all single and united efforts to study, develop strategies for and rectify the mounting greenhouse gas emissions load and fossil/nuclear fuel dependency of the region's urban agglomerations. It supports all integrated and transparent urban efficiency measures; prototype and demonstration projects; public transport and energy-conscious land use planning practices; local generation capacity; equitable urban power pricing; decentralisation of power generation and consumption; local renewable energy ordinances and all programs that are suitable to an accelerated reduction in fossil and nuclear fuel consumption; including measures that may lead to a carbon trading credit scheme involving cities.

The Asia Pacific Renewable Energy Agenda 2004 has been developed and drafted by participants of the 2004 Asia Pacific Roundtable on Renewable Energy and Sustainable Development University of Sydney, 23 April 2004 organised by WCRE and the Research Institute for Asia and the Pacific (RIAP), University of Sydney

© 2004 Renewable Energy Foundation Limited / World Council for Renewable Energy Asia Pacific

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