U.S. Announces Energy Efficiency Assistance for Developing Countries

One of the biggest sticking points at the U.N Climate Change Conference in Copenhagen has been the role of developed nations in helping developing nations foot the bill to use more environmentally friendly sources of energy. Now Department of Energy Secretary Steven Chu has announced the Obama Administration’s new initiatives to promote clean energy technologies in developing countries.

Many of the programs are under the auspices of the Major Economies Forum on Energy and Climate (MEF). Secretary Chu also invited his counterparts in MEF and other countries to a first-ever Clean Energy Ministerial to be held next year.

One part of the new program is a Renewables and Efficiency Deployment Initiative (Climate REDI). The program will accelerate deployment of renewable energy and energy efficiency technologies in developing countries. Climate REDI includes a number of new clean energy technology programs and funding needed to launch a renewable energy program under the World Bank’s Strategic Climate Fund:

• The Solar and LED Energy Access Program will accelerate deployment of affordable solar home systems and LED lanterns to those without access to electricity. This program will yield immediate economic and public health benefits by providing households with low-cost and quality-assured solar alternatives to expensive and polluting kerosene.

• The Super-efficient Equipment and Appliance Deployment Program will harness the market power of MEF countries to improve efficiency for appliances traded throughout the world. A number of MEF countries have implemented, or are exploring, incentive programs for energy-efficient appliances. Coordinating incentives, standards and labeling systems can create unprecedented economies of scale for these appliances.

• The Clean Energy Information Platform will establish an online platform for MEF countries to exchange technical resources, policy experience and the infrastructure to coordinate various activities in deploying clean energy technologies--and to share this information with the world.

• The Scaling-up Renewable Energy Program (S-REP), under the World Bank’s Strategic Climate Fund, will provide policy support and technical assistance to low-income countries developing national renewable energy strategies and underwrite additional capital costs associated with renewable energy investments. Funding through Climate REDI will accelerate the launch of S-REP.

Climate REDI is a “quick-start” initiative to complement the much broader technology and finance mechanisms of an international climate agreement. It will promote dissemination of clean energy technologies through the following tools:

1. Quality assurance to guard developing country consumers against sub-standard renewable energy products
2. Minimum efficiency standards to remove the lowest efficiency appliances from the market
3. Labeling to guide consumers to quality-assured and high-efficiency products
4. Financing for scale up of early-stage low-carbon products, to bring down costs and remove barriers to deployment and to catalyze investment by the private sector
5. Information sharing that enables all energy stakeholders to access state-of-the art information on technology and best practices

To achieve the best results, Climate REDI will coordinate closely with other programs—including other U.S. government programs and international organizations—that promote clean energy technologies in developing countries.

The combined budget for these programs is $350 million over five years. Funding for the first three programs above will total $100 million; the U.S. will contribute $35 million and the balance will come from Italy, Australia, and other partners. Funding for the Scaling-Up Renewable Energy Program will total $250 million – $50 million from the United States and $200 million that the United Kingdom, Netherlands, Norway and Switzerland pledged previously. These previous pledges were subject to the receipt of $250 million in total contributions, a condition satisfied by the United States’ announcement today, which will allow the entire program to go forward.

MEF countries, including the United States, also released ten Technology Action Plans developed under the Global Partnership. These plans summarize mitigation potential of high-priority technologies, highlight best practice policies, and provide a menu of specific actions that countries can take to accelerate development and deployment of low-carbon solutions. The ten technology areas and lead countries are:

1. Advanced vehicles (Canada)
2. Bioenergy (Brazil and Italy)
3. Building energy efficiency (United States)
4. Carbon capture, use and storage (Australia and the UK)
5. High-efficiency, low-emissions coal (India and Japan)
6. Industrial energy efficiency (United States)
7. Marine energy (France)
8. Smart grid (Italy and Korea)
9. Solar energy (Germany and Spain)
10. Wind energy (Germany, Denmark and Spain)

President Obama launched the Major Economies Forum in March 2009, creating a new dialogue among developed and emerging economies to combat climate change and promote clean energy. At their July summit in L’Aquila, Italy, MEF Leaders launched a new Global Partnership on clean energy technologies.