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Economic And Social Commission For Western Asia
Dr. Dhamir MANNAI
Regional Director for Africa and the Middle East
Parliamentary Advisor / Climate Parliament
The Dynamics of Renewable Energy
Policy Development: Key stakeholders,
process and barriers
7TH INTERNATIONAL FORUM ON ENERGY FOR SUSTAINABLE DEVELOPMENT
Baku, Azerbaijan - (18-21 OCTOBER 2016)
INTERNATIONAL CONFERENCE ON RENEWABLE ENERGY / REGIONAL SEMINAR ON:
«Enabling Policies to Promote Financing Renewable Energy Investments»
19-20 October 2016
2 /25
Outline of presentation
1. Levels of Renewable Energy Policies (National, Regional, and
International)
2. Strategic reasons for pursuing effective renewable energy policies
3. Role of effective policies in market initiation and development
4. Policy making: the Process, the Tools, the Goals, and Expected
Outcomes
5. Impact of Strategic National Plans and National Priorities on Policy
Development
6. The complex process of designing / making national Renewable Energy
Policies:
The stakeholders and the main actors
The issues and the stakes
The dynamics between stakeholders
The challenges and the barriers
7. lessons learned from effective and non-effective processes of making
national RE policies
8. Key messages
3 /25
What can good policy do for
renewable energies?
A lot more than what we think
Without good policies, nothing
happens !
With good effective policies,
many good things can happen
5 /25
Good Renewable Energy
policies can trigger tremendous
private investments and growth
in renewable energies
6 /25
7 /25
8 /25
9 /25
Good Energy Efficiency
legislation and regulation can
save a lot of wasted energy
Energy saved is
energy we do not have to produce
10 /25
A Policy is
the highest-level of governance
for Renewable Energy and
Energy Efficiency
11 /25
Renewable Energy Policies …
A Policy is the highest-level of governance for renewable energy
A Policy is a Complex High-Level Horizontal Decision
A Renewable Energy Policy is composed of a set of declared objectives, basic guiding principles of action, and statements of intent. It sets long term goals for Renewable Energies in a particular country
A Renewable Energy Policy is to be implemented, according to a clear strategy and action plans (quantified goals), through procedures undertaken by the different actors and stakeholders
Policy Implementation is a set of shared compatible and complementary actions (programs) undertaken by the various stakeholders within an institutional & legislative framework
Direct Stakeholders of a policy are all parties involved in financing, producing, distributing, consuming, and regulating Renewable Energies
Indirect Stakeholders are Civil-society entities, international agencies (UN, EU,OECD, WB, Etc.)
12 /25
Levels of Renewable Energy Policy considerations …
National, Regional, and International
National considerations for Renewable Energy Policies
Strategic National Security considerations: Energy Security and Geopolitical Situation
Nature and potential of national natural energy resources (Fossil fuels, Hydro, Wind, Solar, Biomass, etc.)
National economy considerations (Subsidies, imports /exports of energy, employment and green economy, urban/rural electrification, etc.)
Energy use and efficiency standards
Production, distribution and use of Renewable Energies (Who can do what?)
Fiscal measures in support of Renewable Energies
Emissions and Environmental considerations (Air Quality, etc.)
Business environment (laws, regulations, etc.)
13 /25
Levels of Renewable Energy Policy Considerations …
National, Regional, and International
International considerations for Renewable Energy Policies
International Politics and Stability of Supply Climate issues and International Engagements (CPDN & Paris Accord) Green Energy Technologies and Industries Discretionary contribution to, and participation in, international green
energy initiatives (UN, EU, OECD, etc.) Availability of international financing opportunities
Regional considerations for Renewable Energy Policies
Laws, regulations and directives of Economic Regions/Communities of Countries
Regional Interconnections and Energy Exchanges/Trading Green Energy Regional Markets
14 /25
Strategic reasons for pursuing effective renewable
energy policies
In terms of social & economic development a country that does not have an adequate supply of energy is a country that has no future
Sustainable Development needs Sustainable Energy
A balance between Security of Energy Supply and Climate Concerns;
Energy Security (Reliably-Available, Affordable, Sustainable)
Economic & Social Development Social and Economic Rural Development Technology and Industrial Development Green Energy, Green Economy, and Green Jobs (Lever of
economic development)
Smooth transition from Existing Situation to New Desired Energy Landscape
Energy Poster : Importer vs Exporter of Energy
15 /25
Role of effective policies in market initiation and
development
Generating/Attracting Investments
Creating an economic advantage for the country
Facilitate regional electricity market integration
Developing a New Segment of the economic activities: technologies, industries, and services yielding economic growth and jobs
Good policies are key catalysts for renewable energy development (Germany, Jordan, Switzerland, Morocco, etc.)
Bad or inadequate policies are big obstacles to development of renewable energies; especially the legislative and regulatory frameworks
16 /25
Policy making: the Process, the Tools, the Goals, and
Expected Outcomes (1/3)
The Process
Gathering the Data, Knowledge, and Facts about the Energy Sector with Analysis as to how it pertains to Renewable Energy sources
Identifying the issues and problems to be resolved
Identifying the National, Regional, and International Experts that will support the Policy Development Process
Identifying the Stakeholders, understanding them, prioritizing them, and define relationships (responsibilities and collaborations)
Explicitly Assigning the Leadership Role for the National Effort of Policy Development
Validating the facts and building consensus around them
Develop Common understanding and appreciation of facts
17 /25
Policy making: the Process, the Tools, the Goals, and
Expected Outcomes (2/3)
The Process (continued)
Policy Formulation
Building Consensus around the Long-Term policy objectives
Building Consensus around the Medium-Term policy objectives
Establishing the high-level policy (Strategic Objectives, Goals)
Policy Gap Analysis in order to develop …
Common understanding of national objectives
Minimum level of consensus on national goals (essential for the policy)
Supporting Policies Identification
Budgeting and Agenda Setting
Policy Implementation Strategy / Action plans
Policy Evaluation and Review Process
18 /25
Policy making: the Process, the Tools, the Goals, and
Expected Outcomes (3/3)
The Tools
Legislative framework (Laws and implementation texts)
Institutional & Regulatory framework (Including implementation institutions)
Fiscal measures and incentives
Non-fiscal incentives
Monitoring compliance with the Policy
Public pressure and Civil Society support (Climate and Energy Access)
19 /25
Impact of Strategic National Plans and National Priorities
on Policy Development
Level of harmony with strategic national plans and national priorities will determine success or failure of a Policy
What makes Renewable Energies a good thing for the National Interest?
Is it economically attractive, politically attractive, or both
Energy Policy must support, and fit with, national economic and social development plans. Otherwise it will not be implemented.
Energy Policy must indicate target budget and timelines (i.e. resources) that are adequate with national priorities (urgency, value, and importance will determine priority)
Ensure adequate level of commitment to Policy from all Stakeholders to insure implementability
Gather social support and awareness on importance of the Policy
20 /25
The complex process of designing / making national
Renewable Energy Policies (1/2):
The Stakeholders and the main actors : Identify them, understand them, prioritize them
Law makers
Government bodies responsible for issuing implementation texts for the laws
Regulatory bodies (Key catalysts for implementation)
Implementers of the Policies
Project developers / Investors Government decision makers Businesses Consumers (corporate and citizens) Civil society influencers to gather support around the Policy
National utility companies
Opinion Leaders (Socializing the concepts and ideas behind the Policy, Participatory Approaches are key to effectiveness of Opinion Leaders)
21 /25
The complex process of designing / making national
Renewable Energy Policies (2/2):
Issues, Stakes, and Dynamics between Stakeholders
Inadequate Political Will
Differences in learning curve
Conflicting stakeholder interests
Lack of cooperation of some stakeholders (to each its reasons)
Protectionism of turf (utilities, concession holders, etc.)
Financing difficulties
Beware of technical arguments as pretext to avoid compliance with Policy
Resistance to change
Analysis-Paralysis, resulting in inadequate reactivity
Existing concessions and international agreements incompatible with new vision of the Policy
Existing complex legislative and regulatory frameworks
Public vs Private Infrastructure Ownership and Operations
Strong Political Will is the solution : Political will that is strong, committed and continuously-engaged
22 /25
The complex process of designing / making national
Renewable Energy Policies (2/2):
Challenges and Barriers to the Policy-Making Process
A Renewable Energy Policy development is a complex multi-criteria challenge that requires a delicate balance of trade-offs between the Stakeholders
Conflicting expectations due to perceived conflicting interests
Lack of leniency in making trade-offs (everyone has to give-in a little bit)
Not easy to identify the “champions of the cause” who have adequate political will and political influence to “make things happen” and “keep the momentum going”
Lack of adequate human & financial resources
23 /25
L e s s o n s l e a r n e d f r o m e f f e c t i v e a n d
i n e f f e c t i v e p r o c e s s e s o f m a k i n g n a t i o n a l
R E p o l i c i e s ( 1 / 2 )
Characteristics of Effective Policy-Making Experiences:
Clear and realistic goals (achievable)
Completeness of the legislative and regulatory frameworks
Assuring institutional feasibility
Measurable targets, clear mandates, adequately allocated resources
Clear controls for assessing effectiveness and efficiency of implementation measures
National awareness and Public Support
Adherence and true commitment of main stakeholders (perseverance)
24 /25
L e s s o n s l e a r n e d f r o m e f f e c t i v e a n d n o n -
e f f e c t i v e p r o c e s s e s o f m a k i n g n a t i o n a l
R E p o l i c i e s ( 2 / 2 )
Characteristics of Ineffective Policy-Making Experiences:
Lack of consensus amongst Stakeholders (Hinders implementability)
Lack of complete and adequate legislative and regulatory frameworks (this is the primary cause of failure to finance renewable energies)
Lack of adequate incentives (fiscal, etc.) in support of Policy
Weak ineffective Institutions and Institutional Feasibility
Lack of Identification of Financing Sources to Implement the Policy
Policy gaps and/or incomplete policies
Dragging out the process of developing the Entire Policy Framework results in process discontinuities, restarts, and loss of momentum
25 /25
Key messages
Situational awareness (Political/Economic/Geopolitics) Identify the supporters Support them and keep them
interested Identify the hesitants Convince them Identify the blockers Be sensitive to their concerns but do
not let them distract you
Comprehensive and Complete Framework that make economic sense (incomplete frameworks get nowhere).
Be swift with Policy Development (avoid dangerous uncertainty periods)
Simplify things for first projects. New policy frameworks need first implementation successes to be validated and accepted
Keep an eye on the Action Stakeholders : Investors and Project Leaders
26 /25
Thank you for your kind attention
Questions
Thank you !