22 February, 2021 ARE article

Backing Innovation: The Formula for Achieving Universal Energy Access


ARE has kicked off the new year with a successful new event that attracted more than 1,000 participants. Our first ever Technology and Innovation Forum took place on 27-28 January 2021 and brought together energy experts as well as a diverse group of stakeholders, financial institutions, and civil societies. This event, supported by GET.invest, highlights ARE’s belief in technology and innovation as a decisive driver of economic growth and development, as well as climate mitigation and adaptation.

Technology and innovation have enabled a dramatic cost reduction across the board for renewable energy technologies, especially solar and wind, significantly improving their competitiveness in the market. This appears to be both a cause and consequence of the growing volumes of investment into the renewable energy sector, exacerbated by long overdue cuts in harmful and distorting fossil fuel subsidies. At the forefront of innovation and technology in the renewable energy sector, are the decentralised renewable energy (DRE) solutions, which can be very fast to deploy, are typically best tailored to the needs on the ground and can be drastically scaled up if the right conditions are created, all of which underpins their strong business case and value proposition.

By expanding ARE’s strategic focus from policy, regulation and access to finance, to prominently feature technology and innovation, ARE believes the essential ingredients are in place to support a virtuous cycle of better policies and regulation, ever more competitive and innovative technical solutions, and increasingly compelling business cases to attract investment. It is the combination of policy, finance and technology that will enable DRE to scale. This in turn allows us to effectively achieve universal electricity access, local economic development and concretely fight climate change and boost resilience. In light of these recognitions, ARE has partnered with Energy Catalyst and the European Space Agency to further position innovative DRE companies and technologies to the forefront of the energy access challenge.

As the sector’s oldest and largest business association bringing together all renewable energy technologies across the emerging markets, ARE calls on all governments and development partners to work together with ARE. Together we can implement concrete, targeted programmes designed to deliver a maximum number of new connections in the least amount of time. We can do this by leveraging the private sector capacity to drive innovation and inject capital, where governments and their Development Finance Institutions lead the way. The COVID-19 vaccine development process is evidence of the winning formula of public and private partnership: governments set a goal and provide the risk capital, after which private sector businesses come in en masse to develop solutions and achieve scale in record time.

Energy access is not an elusive goal. The COVID-19 vaccine process shows that a clear direction of travel, matched by the means to get there, and a strong cooperation with the private sector and key stakeholders, delivers the goals we want to achieve as a society. Therefore, if we are serious about achieving SDG-7 and particularly universal clean electrification we must: set clear stable incentivising policies, put money in the parts of the finance chain and project cycle that are promising but risky, or perceived to be risky, and fund innovation. This is possible by working with stakeholders to have ongoing monitoring and improvement where necessary.

By working with ARE, governments and development partners, as well as foundations, can: help safeguard that their programmes and activities are tailored to the needs on the ground and are therefore more effective; learn from experiences in other markets; and make sure that the wider private sector and other stakeholders working on the ground are aware of new opportunities. Therefore, ARE and its wide breadth of Members that encompass numerous developers, investors, tech suppliers and platforms, consultants as well as other stakeholders like NGOs, universities and public partners can act as an efficient delivery service for SDG-7.

In this exciting period for the DRE sector, ARE calls on the private sector and all stakeholders on the ground to join the ARE family and cooperate with national RE associations to achieve our shared goals of universal energy access.

-David Lecoque, CEO, ARE