They’re Diversifying And We’re Not

Recently, Petronas, the Malaysian oil and gas company has announced that it will be dabbling in the renewable energy sector. The firm recently announced that it inked a deal with Singapore-based renewable energy firm specializing in solar panels, Amplus Energy Solutions.

Petronas said that its deal with Amplus is part of the firm’s strategy to develop solar power plants and rooftop project. This deal says Petronas CEO Tan Sri Wan Zulkiflee Wan Ariffin is the first step into the firm’s diversification.  “This acquisition reflects Petronas’ strategic intent to grow in the renewable energy space as part of our strategy to step out beyond oil and gas into the new energy business. This also represents our first international solar venture and we look forward to providing energy solutions to our customers in these high-growth energy markets.”

Petronas is not alone in turning to renewable power to serve their customers well and maximize their profits. In fact, many Southeast Asian energy companies that are highly dependent on fossil fuels are also entering the renewable energy market in order to meet the region’s demand for electricity.

For example, Thailand-based energy firm, Banpu sources 90 percent of its revenue from its coal plant, but recently entered the renewable energy market. “We will integrate coal with renewable energy with the aim of maximizing profit and meeting social needs,” Banpu’s CEO Somruedee Chaimongkol says.

Banpu, which operates in several Asian countries as well as the United States has installed some 150,000 Kilowatt hour worth of solar generators. The firm also plans to build 80,000-kilowatts wind farm in Vietnam by 2021.

Likewise, State-backed energy companies in Southeast Asia are adopting the same diversification strategy. For example, Tenaga Nasional, a Malaysia energy firm started the commercial operations of its 50,000 kWh solar power plant near Kuala Lumpur, which is one of the largest solar plants in the country. 

Similarly, Indonesia’s state-run utility PLN is tapping on the country’s geothermal potential by purchasing renewable energy generated by independent geothermal power producers.

Darajat_geothermal_plant_Chevron_Indonesia-1024x682

PLN’s Darajat Unit Geothermal Power Plant. PLN is buying renewable energy from independent power producers. Photo c/o http://www.thinkgeoenergy.com

These companies, which once only had coal in their portfolio are probably now seeing the value of energy diversification. 

In energy systems planning, there are three basic properties of diversifications, namely, balance, variety, and disparity as pointed out by Andy Stirling,  a professor of Science and Technology Policy at the University of Sussex.

Variety pertains to the number of energy supply options available. This is what these companies are aiming for as having varied energy types means more diversity in their portfolio.

On the other hand, balance refers to the reliance on each available energy source option available. This means an energy system is also considered more diverse if there are proportionate dependence on each energy source. Disparity pertains to the differences in each power option.

It’s not only companies that will benefit from having a diversified energy mix. As I keep repeating, nations too will be in an advantageous position if there is diversity in their energy system.

For example, the Philippines relies heavily on coal to meet energy demands. This means our power costs go up when prices of coal in the global market increase. It also does not help when the peso falls against the dollar as we import coal. Whether power consumers will pay higher electricity bills highly depends on world prices and the strength of the peso. And this is all because we source most of our energy needs from coal plants.

We also have to remember that fossil fuels are finite resources. What happens then when these resources are depleted?

This is why we need to diversify our the power mix. This means we should be able to source a majority of our power from sources that are not vulnerable to external factors such as exchange rate and global prices. And again, as I have been saying, renewable energy prices can be fixed for many years. Of course, we also have to prepare for the scenario when finite power sources are low in supply or worse, already gone.

On a side note, many see the Supreme Court decision as challenging the supply of power in the future. I think we should take a step back and think of this as an opportunity to re-think about the energy mix of the country.  We have an opportunity to inject more indigenous and renewable energy in the system. We should grab this chance.

Energy diversification indeed has many virtues. Energy companies with mostly coal power plants in their portfolios are now seeing the value of diversifying their energy sources. Sadly, the same cannot be said about our energy system, our planners and regulators in the country.

References:

https://asia.nikkei.com/Spotlight/Environment/Southeast-Asia-s-energy-majors-pivot-sharply-to-green-power2

https://www.power-technology.com/news/petronas-renewable-energy/

Diversity and Sustainable Energy Transitions: Multicriteria Diversity Analysis of Electricity Portfolios By Andy Stirling

From Second To Third: How PH Dropped To 3rd Place in Geothermal Power Production

The Philippines was once the second largest producer of geothermal power in the world. Sadly, this is no longer true.

Last year, the Mineral Resources Industry of Indonesia announced that its country’s geothermal power production has reached 1,800 megawatts (MW), making the country the second largest geothermal power producer. The Philippines, on the other hand, production has decreased from 1850 MW to 1600. We now just rank third.

There are many reasons for our country’s lower geothermal power production. And we need to look at the history of geothermal power development in the country to understand how we got to our current state.

In the early 1970s, the government had a partnership with Union Oil Company of California, or Unocal, now known as Chevron. Under this partnership, the Unocal will provide technical expertise while the Philippine government, through the National Power Corporation on NPC will build and operate the geothermal plants. In 1976, the government decided to do away with the private sector and build and do the exploration with Philippine National Oil Corporation-Exploration Development Corporation (PNOC-EDC) as the head agency.

At the height of the power crisis in the 1990s, the National Power Corporation signed an agreement with PNOC-EDC, then a government corporation, to develop and provide 700 MW of geothermal power in Leyte. This move catapulted the Philippines to the second largest producer of geothermal power in the world. We were second only to the US.

The Electric Power Industry Reform Act or EPIRA was a game changer for the energy sector. With the passage of this law, geothermal power exploration and development was left to the hands of the private sector. This means that the private sector has to spend for the exploration of possible geothermal sources and build the power plants, which are expensive. Exploration expenses cost more than half of the total project cost for geothermal power plant projects. And test drilling just a single hole can cost some $5 million as it is the most costly phase of the exploration. It is the private firm that assumes the cost and risk of the exploration activities.

The high capital needed for greenfield exploration is one of the reasons why most private entities stay away from geothermal power development. There was a time when the government shouldered the cost of the preliminary survey of the areas, but this is now being assumed by the private sector developer.

Unfortunately, our regulations do not help in making geothermal exploration and development enticing to investors. On the contrary, our regulators have little appreciation for the risks being taken by geothermal developers in our tariff setting.

geo

I have talked about this greatly in a separate post. But to put it simply, we use the BETA in the computation of the cost of equity under the Capital Asset Pricing Model or CAPM for our tariff setting. The Beta in the tariff equation determines the return on equity for any project. And sadly, the Energy Regulatory Commission uses the same Beta of ~1.03 for all power plant project regardless of technology. This means that the ERC does not consider the risk profile of the power plant project. This is an incorrect application of the CAPM and sadly puts geothermal power developers at a disadvantage since they assume the high-risks of the exploration but will not be properly compensated for it.

Why the ERC insists on using the same Beta for all power projects is mind- boggling especially since it has long been established that geothermal development is a high-risk undertaking. A study conducted by the International Finance Corporation years ago concluded that only 60 percent of the explored holes during geothermal exploration worldwide turned out to be successful.

The ERC’s attitude towards geothermal energy is just one of the regulatory issues that renewable energy advocates and developers have to contend with. Overall, previous administrations have paid little attention to renewable energy development anyway. Unfortunately, the lack of opportunities in this field has also lead geothermal energy experts to find work in other countries such as Indonesia.

It is no wonder why many local investors are not too keen to get into geothermal development in the Philippines. It also does not help that our constitution prevents us from getting more foreign investors to help us develop our natural resources.

It’s sad that a country like ours is missing the missing out on the benefits of geothermal power. The Philippines also has a great advantage in geothermal since we are located in the ring of fire and has many volcanic areas where geothermal resources are abundant. In fact, some studies show that the Philippines 2,047 MW of proven reserves and 4,790 MW of potential reserves.

We have to keep in mind that geothermal energy can act as a base load plant, which makes it a great substitute for traditional sources of power. And if we can just use geothermal power to replace coal, then we can surely enjoy cheaper power rates. Geothermal energy, as well as any other renewable power technologies, have a fixed price as I have discussed previously. This means Filipinos will no longer have to pay for the fluctuating cost of international coal prices and foreign exchange rates.

The Philippines’ drop to third place in geothermal energy production worldwide only shows that the lack of government support for renewable energy development has dire consequences. It may be a pity that we now rank lower than our neighbor. But what’s worse is that our country is failing to harness its rich natural resources properly for the benefit of the Filipino consumers.

References:

https://www.pwc.com/id/en/media-centre/infrastructure-news/infrastructure-news—archive/december-2017/indonesia-second-biggest-geothermal.html

More Competition in the New Year and the Coming Years

The previous year ended with news that the Meralco-Marubeni Consortium won the bidding for power distribution of the New Clark City, the first city in the Philippines to have a smart-power grid and underground cables. This means that residents and business of the smart city will enjoy low utility rates.

The Bases Conversion and Development Authority (BCDA), owner of the New Clark City is set to ink the agreement this month with the Meralco-Marubeni Consortium, consisting of Meralco, Marubeni Corp., Kansai Electric Power Co. Inc., and Chubu Electric Power Co. Inc., Their proposed tariff bid was P0.6188 per kilowatt-hour (kWh).

The Meralco and Marubeni consortium was able to beat the Aboitiz-Kepco Consortium of the Olongapo Energy Corp. and Kepco Philippines Holdings Inc, which proposed a P0.9888 per kWh tariff.

It is worthy to note that both bids were lower than the tariff ceiling Php 1.25 kWh set by the BCDA for power distribution. The proposals are also cheaper than the Php1.24 kWh of Mactan electric, the lowest distribution supply metering tariff that’s under the traditional distribution system.

This bidding is proof that competition, as any economist worth his or her salt would know, would always benefit consumers. And competition in the distribution of power is what the Filipinos need to enjoy cheaper power rates. Although the game I talk about is not exactly in this context, but this recent bidding gives flavor to what I mean.

And since it is the start of the year, let me share my reflections on what can be done to achieve lower electricity bills for all of us.

We can start by allowing more franchise holders in a single area rather than stick with the current rules of only granting a franchise to one. The logic is simple. Firms vying for the same customer base will find ways to beat their competitors either concerning better service or price.

Unfortunately, allowing just one franchise holder per area fails to push the franchise holder to improve its services and offer competitive pricing. This is what monopoly does– leave the firm to dictate prices and be complacent in its service delivery. If several businesses are competing for the same customer base, then surely we can expect players to always be on their toes to find ways to beat other firms or electric cooperatives.

Our lawmakers can also review the rules for the Retail Competition and Open Access (RCOA), too. Present rules, after all, require that only those with 750 kWh or higher monthly peak demand or contestable customers can choose their power providers. This means those with lesser than 750 kWh or captive customers are not given that option.

But why should we single out those with higher consumption and not give the option to all power consumers to choose their sources and distributors? If indeed the consumers’ welfare is the top priority, then we should also allow captive customers this alternative. We need to have some solutions to what people expect to be “stranded assets.” This, surely, can be addressed. We just need creativity here.

These are just some of the changes we need if we want Filipinos to benefit from the essence of EPIRA, the law crafted to foster more competition in the energy sector. We need to make major changes if indeed the Filipino consumers’ welfare is of the utmost importance.

The New Year brings hope to all of us. And, it is my wish for the New Year that our regulators would see the critical role that competition plays in the energy sector and have the political will to make the changes needed.

Small Victories

 

eucommision

The EU agreed to increase RE share to 32% by 2030. Photo c/o https://www.finchannel.com

There are many small victories to celebrate among renewable energy advocates.

Last June, the European Commission, Parliament and Council agreed to increase renewable power use in the region to 32 percent by 2030, up from the previous goal of 27 percent.

Aside from setting this target, the agreement also included removal of barriers to entry of renewable energy small players as well as a review of the 32 percent goal in 2023.

The new goal was set so that the region can meet its goal of reducing greenhouse gas emissions by 40 percent, below 1990 levels by 2030 as part of its commitment to the Paris Agreement of keeping global warming below 2 degrees. “This deal is a hard-won victory in our efforts to unlock the true potential of Europe’s clean energy transition,” EU Climate Commissioner Miguel Arias Canete was quoted.

And there is more good news from this region since Sweden is set to achieve its renewable energy targets 12 years ahead of the deadline.

The Nordic nation is likely to reach its 2030 renewable energy target of generating 18 terawatt-hours annually from renewables by the end of the year according to the Swedish Wind Energy Association (SWEA). This feat will be possible, thanks to the aggressive installation of wind turbines since some 3,681 wind turbines will be operational across the country by year-end.

Europe is not the only one that brought good news. Japan also recently announced its plans of boosting renewable energy use by 2030 by 22 to 24 percent. Currently, the country sources 15 percent of its energy demand from renewable sources.

Unfortunately, the Philippines did not make a similar announcement and instead opted to push down our goal of sourcing 35 percent of overall power needs from RE by 2030 to 2040.

But this is not to say that we lack good news in renewable energy front or that Filipinos entirely lack appreciation for renewable energy. After all, several local government units (LGUs) have declared their support for cleaner forms of power.

For example, last June, the city council of Ozamiz revoked an earlier resolution endorsing the proposal to build a 300-megawatt coal-fired plant and instead adopted a new one to look for prospective investors for renewable energy in the city.

The same case happened in Bohol last March where its local government prevented the building of new coal power plants since “the entire Provincial Government of Bohol are fully intent on maintaining the sanctity and pristine condition of the environment.”

Eventually, the LGU of Bohol passed an ordinance against the establishment of coal power plants in the province on April 6, joining the ranks of Guimaras and Ilocos Norte, which had already banned coal and shifted to renewable energy.

Yes, our national government may be slow in realizing the value of renewable power, unlike other nations like the European countries and Japan but at least our provinces know the worth of going renewables. Maybe soon, more Filipinos including government officials will realize what renewable power can do for our country and that, as Guimaras Governor Samuel Gumarin said in a speech, “a sustainable-development path, powered by renewable energy, is not only possible but more viable.”

References:

https://www.rappler.com/nation/203386-bohol-no-coal-ordinance-epira-greenpeace

https://climatereality.ph/climate-reality-ph-lauds-ozamiz-city-climate-action-819/

https://www.channelnewsasia.com/news/asia/japan-aims-for-24–renewable-energy-but-keeps-nuclear-central-10495024

https://www.theguardian.com/business/2018/jun/14/eu-raises-renewable-energy-targets-to-32-by-2030

Sweden to reach its 2030 renewable energy target this year

Survey Says

The majority of Filipinos are dissatisfied with current power prices according to a survey by Pulse Asia.

Last August, the research firm released its report revealing that around 60 percent of Filipinos are dissatisfied with the power rates. “With the exception of Mindanao, at least half of adults in the main geographic areas are dissatisfied with the price of their electricity,” Pulse Asia said.

The survey also showed that a significant majority of Filipinos or 82 percent are in favor of “having a new option for electric service provider or electric utility.” In the National Capital Region (NCR), 88 percent of adult Filipinos expressed openness to having new electric service providers. Plus, 89 percent of Filipinos also favor renewable energy.

The survey results are a testament to the growing dissatisfaction of Filipinos on our high power rates. They are also aware that there is a need for more competition in our energy sector even in the distribution segment to cut the cost of electricity. Competition, after all, will always drive down market prices. And it is not surprising that the vast majority of the survey participant for NCR is open for more distributors as the monopoly of a company in any business will never be beneficial for consumers.

Unfortunately, the passage of the Electric Power Industry Reform Act (EPIRA) did little to invite competition in the markets in the distribution side as we focused more on having more players in the generation business.

But there are steps our regulators can take to generate more players in the distribution of power. For one, we can break away from the current practice of disallowing a new distribution entity to enter the market where one DU is in place. Such practice fails to promote competition and instead allows for a monopoly to flourish.

Aside from allowing other power players to enter an already franchised service area, our regulators should also consider lifting the cap for the Retail Competition and Open Access (RCOA).

Currently, the rule says that only those with a monthly peak demand of 750 kilowatts or higher can be considered contestable customers and can choose their preferred service providers. In my opinion, this rule should be revised as anyone regardless of their power consumption should be given the option to decide where to source their power.

We have to keep in mind that contestable customers get to save on their energy bills than the captive customers or those who are required to source from their distribution utilities or electric cooperatives. In a column in BusinessWorld, President of Minimal Government Thinkers, Bienvenido S. Oplas, Jr. President of Minimal Government Thinkers notes that contestable customers on average only pay Php 6.91 per kilowatt hour (kWh) considerably lower than the captive customers who pay roughly Php 7.78 kWh.

Our government then should work on giving choices to the majority of the Filipinos by allowing them to choose their power generator or distributor rather than force them to stay with their current ones. Naturally, aside from lifting the restriction on RCOA, there is also a need to make the infrastructure and resources available to pave the way for this scenario where customers have the freedom to choose their energy type, generator, and even distributor.

DU competition

Technology will soon render the traditional distribution system obsolete according to experts. Photo c/o https://m.dailyhunt.in

We have to make these changes if we do not want to be left behind. Let us keep in mind that the technological advancements will soon render the traditional distribution system obsolete as asserted by many experts. For example, David Cane, former CEO of NRG Energy believes that the existing utility system will become irrelevant in the near future since many advanced countries are moving towards decentralized homegrown energy where home automation be of great importance. He argues that “When we think of who our competitors or partners will be, it will be the Googles, Comcasts, AT&Ts who are already inside the meter.”

Indeed, we need to create an environment that can accommodate these technologies, so we can benefit from having more options as well as cheaper power prices to consumers.

Having choices is one of the best ways to promote competition and hence lower down the power costs in the country. However, major changes are needed that require a lot of willpower. It is time for our regulators to put the interest of the Filipino consumers above anything else.

References:

https://www.philstar.com/headlines/2018/08/21/1844441/filipinos-not-satisfied-high-power-rates-poll

https://www.bworldonline.com/electricity-competition-epira-and-wesm/

Moving Forward: Introducing Competition in Power Distribution

Around the globe, significant changes are taking place in the power sector, particularly in the distribution of energy given the advances in technology. Many countries are gearing up to take advantage of new technologies to help reduce the cost of power, among other reasons.

For example, the European Union (EU) is paving the way for its electricity system to be more efficient by encouraging consumers to use intermittent renewables at different times of the day to save on power and lower their electricity bills. At this time, the EU is working on policies to make it possible.

Those who use more power during off-peak demand or when renewable energy technologies are running on their peak will be given incentives also known as the dynamic pricing scheme.

Other European countries like Spain and Nordic states are already implementing the dynamic pricing. In the long run, EU envisions that customers’ appliances such as washing machines or dryers will run automatically during the day when the sun is shining at its brightest or during windy days. This dynamic pricing scheme is expected to save as much each household an estimated average of €400 annually with the help, of course, of smart meters and smart grids.

Some may be doubtful of EU’s vision and label it as too ambitious. But EU’s goal is achievable. After all, breaking away from the traditional model of the distribution of having power stations at one end with the customers on the other end of the supply chain is long overdue.

Consumers now should have the option of selecting their preferred kind of energy, source, and even meters. This is possible except our tolerance for monopoly has limited the choices available to us consumers, a point stressed by several experts.

For example, Nobel Prize awardee Vernon Smith, who as early in the 1980s, argued that deregulation of the electricity market is possible if there is competition for generation, transmission and even distribution.

In his paper, Currents of Competition in Electricity Markets, he stressed that “Competition is now evident on the fringes of power generation, and a foundation is in place for deregulating not only generation but possibly transmission and distribution as well.”

The economics professor pointed out that regulators have encouraged monopoly in electricity markets rather than implement rules that promote competition: “ An examination of the electric power industry as it exists today reveals a tremendous untapped potential for the development of competitive markets. Regulation has been applied far too broadly to the electric power industry. As a result, policies intended to restrain monopoly power have instead propagated that power.”

smart meters 2

Smart meters in Europe. Changes in the consumption and provision of electricity driven by emerging technologies are taking place and making way for more options in power consumption. Photo c/o http://www.nec-display-solutions.com

A recent paper, Utility of the Future by Massachusetts Institute of Technology (MIT), discusses how changes in the consumption and provision of electricity driven by emerging technologies are taking place and making way for more options in power consumption.

One of the goals of the research is to identify inefficient barriers to the integration of cost-effective new sources of electricity services to help create a level playing field for the provision and consumption of power services.

One of the recommendations of the study is that “the structure of the electricity industry should be carefully re-evaluated to minimize conflict. It is critical to establish a level playing field for the competitive provision of electricity services by traditional generators, network providers, and distributed energy resources.”

The study further stressed that it is essential to review how markets work to make way for new technologies and their integration into the electricity system: “Wholesale market design should be improved to better integrate distributed resources, reward greater flexibility, and create a level playing field for all technologies.”

And it seems that the researchers are addressing our local regulators with their recommendations. It is no secret that I have been calling out for revisions in our policies that would pave the way for new players so that Filipino consumers can enjoy lower power costs especially since new technologies are emerging.

Time and time again I have been calling the attention of the Department of Energy (DOE) to take drastic measures to promote competition rather than protect private interests as this is the essence of the Electric Power Industry Reform Act (EPIRA).

Unfortunately, despite the passage of this law, the welfare of the Filipino consumers takes a backseat while private interests in the distribution sector prevail as manifested in different ways.

For example, currently, our energy regulators are disallowing other franchise holders to enter the market where a Distribution Utility (DU) is already in place, which against runs counter to the essence of promoting competition.

This was the same point made by Smith in his paper when he stressed that “There are numerous ways to introduce competition into electric power distribution. Perhaps the most obvious is to eliminate state policies which grant distributors exclusive operating permits. Customers should have the right to bypass distributors and contract directly with generator owners.”

If one understands basic economics, then it is evident that having more players in the market would always push down prices and create a more efficient delivery of goods and services because this is what competition among businesses does. Preventing the encroachment of another player in an already franchised area will only result in a monopoly where consumers will have to endure higher prices and less efficient service delivery. There is no incentive for the lone provider to improve the services and lower down costs, anyway.

Our flawed power procurement rules should also be reviewed. At present the Energy Regulatory Commission (ERC) procurement rules do not require DUs or Electric Cooperatives (ECs) to differentiate between baseload, peaking and mid-merit, and fail to take account that some power sources are better used for baseload and others for peaking or mid-merit. The classic example is the use of coal-fired power plants during mid-merit, which when done, diminishes the cost advantages of the plant. Such practice results in inefficient deployment of energy sources.

Unfortunately, procurement rules do not differentiate the power requirements to the detriment of the consumers as they are not enjoying the cost advantages of a particular power source. Instead, our practice only benefits the DUs or ECs.

There is a remedy for this as the ERC can refuse to grant Power Sales Agreements (PSAs) that do not define the limits on the use of a particular power source. We can use each energy source more efficiently and at the same time help level the playing field for generators if the ERC puts such restrictions in the PSAs.

These are just some of the few issues that prevent competition to flourish within the power distribution sector. There are more that requires the attention of our regulators. Change is necessary if we want to move to where the EU is heading.

There are many reasons why countries and regions like EU are embracing technology such as the concept of dynamic pricing by changing and drafting new regulations. Lowering the cost of power rates is just one of them.

The Filipinos can enjoy lower power prices, too. They can even choose where or from whom to source their power as well as select their meters rather than merely accept the ones from the distributor. Consumers can also become generators and distributors themselves if they wish. All these are possible if major policy shifts take place and when our regulators finally prioritize the welfare of the public rather than those of the few.

References:

Currents of Competition in Electricity Markets by Vernon L. Smith

Utility of the Future by Massachusetts Institute of Technology

Run Your Dishwasher When the Sun Shines; Dynamic Power Pricing Grows

https://www.reuters.com/article/us-europe-electricity-prices-insight/run-your-dishwasher-when-the-sun-shines-dynamic-power-pricing-grows-idUSKBN1KN0L7

For European utilities, demand for dynamic pricing on the rise
https://www.accenture.com/us-en/blogs/blogs-european-utilities-demand-dynamic-pricing

A Timely Reminder

Three years ago, Pope Francis made a strong appeal to the world to address the growing problem of climate change. In his 180-page encyclical, the pope stressed that “Climate change is a global problem with grave implications: environmental, social, economic, political and for the distribution of goods. It represents one of the principal challenges facing humanity in our day.”

Pope Francis recently made the same appeal with investors, oil executives and Vatican experts during an unprecedented conference at the Pontifical Academy of Sciences.

The pontiff had stressed that climate change must be addressed soon and the world has to use a power mix that will combat pollution, promote social justice, and combat pollution. “But that energy should also be clean, by a reduction in the systematic use of fossil fuels. Our desire to ensure energy for all must not lead to the undesired effect of a spiral of extreme climate changes due to a catastrophic rise in global temperatures, harsher environments and increased levels of poverty,” the pope said.

He reminded his audience that development must not come at the expense of the environment “Civilisation requires energy, but energy use must not destroy civilisation.”

The head of the Catholic Church has never wavered in his appeal to the world to make the planet a better place by saving the environment. His recent plea is also timely as studies and reports show that the world has to do more in fighting the effects of climate change.

The recent United Nation (UN), a yearly report entitled ‘The Sustainable Development Goals Report 2018” concluded that climate change along with inequality and conflict are the primary factors in growing hunger and displacement around the world.

The figures in the report showed that the world has a long way to go in combating the effects of climate change including the health hazards. After all, the World Health Organization once tagged climate change as “the defining issue for the 21st century.”

The UN study revealed that in 2016, around the world, 91 percent of the urban population were breathing dirty air or air that failed to meet the WHO Air Quality Guidelines. What’s worse is that more than half of the said population were exposed to air pollution levels that are at least 2.5 times higher than the safety standard. It is not surprising then that around 4.2 million people died due to high levels of ambient air pollution.

The same report showed that renewable power’s share in the final energy consumption had a moderate increase from 17.3 percent in 2014 to only 17.5 percent in 2015.

That’s a sad figure, especially when the more significant use of renewable energy can save lives. Let us remember that both coal and oil power have greater death prints, or what energy expert James Conca defines as the “number of people killed by one kind of energy or another per kilowatt hour (kWh) produced.”

In fact, the mortality rate of coal, which is derived by dividing the trillion kilowatt hour of use, is 100,000 when we get 50 percent or our energy needs from this source. Likewise, oil has a mortality rate of 36,000 for every eight percent of the energy it supplies.

Apparently, the growth of renewables in the world’s energy mix had been slow and more people are literally dying because of it. Clearly, more must be done to combat climate change, which includes developing and using more cleaner forms of energy.

Let us heed the Pope’s call, shall we?

References:

https://www.theguardian.com/world/2018/jun/09/pope-francis-tells-oil-bosses-world-must-wean-itself-off-fossil-fuels

http://sdg.iisd.org/news/sdg-report-2018-finds-conflict-climate-change-inequality-hindering-progress/

https://www.forbes.com/sites/jamesconca/2012/06/10/energys-deathprint-a-price-always-paid/#16e2ea1b709b