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Unofficial summary of Allianz Climate and Energy Monitor 2017

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Unofficial summary of Allianz Climate and Energy Monitor 2017. This document is an unofficial and voluntary summary of the Allianz Climate and Energy Monitor 2017. All information and graphics are taken from the Allianz Climate and Energy Monitor 2017 which can be accessed via the link below. Please also note that all errors in this summary document belong to Arif Cem Gundogan.

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Unofficial summary of Allianz Climate and Energy Monitor 2017

  1. 1. Allianz Climate & Energy Monitor 2017 The Allianz Climate and Energy Monitor aims to provide tools for enhancing communication between the investor community and policy-makers. It is a composite index and ranks G20 countries with regards to their potential in closing the financing gap in a low-carbon, climate-resilient energy infrastructure. To index concentrates on two critical elements: “Attractiveness of various ‘in-country’ circumstances to potential renewable energy investors” and “General investment needs in the power sector through to 2035 in light of the Paris Agreement’s 2°C climate target”. RECALL: Paris Agreement sets an ambitious goal of limiting global average temperature increase to well below 2°C with efforts to limit it to 1.5°C. RECALL: G20 countries consist of the biggest economies on our planet and therefore they are natural leaders who can trigger the energy transition. How have the investment conditions changed in the G20 countries? Renewable energy is booming in emerging markets: “2016 was a year of impressive solar photovoltaic (PV) installations in the G20. On average, G20 countries installed 50% more solar PV last year than in 2015. New installations for wind decreased by 24%, although from a high level. Renewable energy expansion was notable in emerging markets in China, India, South Africa, Mexico and Turkey.” OECD countries are still the most attractive destinations for investments due to strong policy frameworks, market experience and positive macroeconomic factors. “Germany, UK and France maintain their top positions in the 2017 Monitor. Turkey, Saudi Arabia and Russia remain at the end of the scale with support for renewables in infancy. Russia and Turkey are the only two G20 countries who have not ratified the Paris Agreement yet, the US has decided to pursue steps to exit the Paris Agreement in June 2017.” Investment needs in the G20 (and particularly in emerging economies) are high: ”The G20 countries need to roughly double their annual investments to align their power infrastructure with the 2°C pathway set out in the Paris Agreement. The absolute investment needs stand at USD2012 709 billion per year between 2014-2035.” G20 governments are adjusting renewable energy support mechanisms and regulations: “Renewables have grown on average at 24% annually in the last five years. In response to expanding renewable energy capacities beyond hydro and falling technology costs, G20 countries are adjusting their support for deployment of renewables-based electricity generation.” G20 countries take climate and renewable energy action, but incrementally: “Many G20 countries took gradual steps for the low-carbon transition of their power sector in 2016. Some countries hold an optimistic outlook for renewables despite lower scores this year. Both Turkey (rank 18) and Saudi Arabia (rank 19) are expected to go full-steam for meeting their renewable energy targets in 2017 and have announced tenders for large scale wind and solar PV”. “Two elements are essential to unlocking climate finance: the removal of real or perceived risks to investment, and incentives to accelerate and attract financing.” “Emerging economies increasingly take on a leadership role & are credibly enhancing their renewable energy financing frameworks.” “Effective regulatory frameworks are important for supporting low-carbon investing. Reliable regulation enables access to larger capital at lower cost.” Achim Steiner, UNDP Administrator and Chair of the UN Development Group Simone Ruiz-Vergote, Managing Director, Allianz Climate Solutions Axel Zehren, CFO, Allianz Investment Management SE Allianz Climate and Energy Monitor is carried out by Allianz Climate Solutions and its research partners New Climate Institute and Germanwatch. https://www.allianz.com/en/sustainability/articles/allianz_climate_energy_monitor/ IMPORTANT: This is an unofficial and voluntary summary by Arif Cem Gundogan Please see the last page.
  2. 2. (Continues) How have the investment conditions changed in the G20 countries? Falling technology costs triggers further renewables growth: “2016 also saw renewables growing due to falling technology costs despite cumbersome policy environments in some countries. Most striking example has been the US." Governments need to start planning for a new power system: “As renewables grow, the next wave of policy intervention by governments needs to move beyond targeting low- carbon electricity generation towards system design. With higher shares of variable power generation, electricity grids need to be able to balance weather-related peaks.” Allianz Climate & Energy Monitor 2017 System Change on Horizon? Yes and no. “The discussions around system change are most advanced in Germany, the UK and France. Yet important decisions on long-term expansion of renewables and market structure are still to be taken.” There are group of countries with no long term (up to 2050) strategy for deep decarbonization of the electricity system & integration of renewables: Argentina, Australia, Indonesia, Russia, Saudi Arabia, South Africa & Turkey. Overview of the results from the Allianz Climate and Energy Monitor 2017 Allianz Climate and Energy Monitor is carried out by Allianz Climate Solutions and its research partners New Climate Institute and Germanwatch. https://www.allianz.com/en/sustainability/articles/allianz_climate_energy_monitor/ IMPORTANT: This is an unofficial and voluntary summary by Arif Cem Gundogan Please see the last page.
  3. 3. Allianz Climate & Energy Monitor 2017 Quadrant Analysis of the results from the Allianz Climate and Energy Monitor 2017 Allianz Climate and Energy Monitor is carried out by Allianz Climate Solutions and its research partners New Climate Institute and Germanwatch. https://www.allianz.com/en/sustainability/articles/allianz_climate_energy_monitor/ IMPORTANT NOTE: This document is an unofficial and voluntary summary of the Allianz Climate and Energy Monitor 2017. All information and graphics are taken from the Allianz Climate and Energy Monitor 2017 which can be accessed via the link below. Please also note that all errors in this summary document belong to Arif Cem Gundogan. IMPORTANT: This is an unofficial and voluntary summary by Arif Cem Gundogan Please see the note below.

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