U.S. Support for the Sustainable Energy for All Global Action Agenda
The UN Secretary General’s Sustainable Energy for All (SE4ALL) initiative represents an important opportunity for the international community to address issues critical to the future of sustainable development, energy access, and economic growth. Expanding the use of efficient and clean energy technologies is a priority of the Obama Administration, domestically and internationally, and increasing energy access is a central challenge facing the world.
The United States supports the principles of the Global Action Agenda developed by the SE4ALL High Level Group through existing and planned activities across a broad range of U.S. Government agencies. As reported elsewhere in official documents, the U.S. is providing substantial grant, loan and loan guarantee resources, from both Congressionally-appropriated funds and under loan and loan guarantee authorities, of about $2 billion in FY11 for clean energy. The Administration looks forward to working with the Congress on activities in FY12 that will build on and sustain this USG priority. These funds are helping to create a sound policy, regulatory and institutional framework for project investment and financing from private and international sources as well as directly leveraging investment. Support for innovation and energy technology partnerships is also an important focus. In building viable and sustainable energy markets, U.S. support helps create opportunities for American exports in renewable energy, power generation and energy efficiency technologies.
Below are specific examples of on-going and planned U.S. Government support for the SE4All Global Action Agenda:
1. Technical Assistance for Improving the Enabling Environment
Sustainable Clean Energy Development: Within this overall U.S. effort, the U.S. Agency for International Development (USAID) and the State Department are promoting sustainable, low emissions development through a range of clean energy activities that have national, regional, and global components. One major activity involves cooperation with up to 20 countries in developing and implementing low emissions development strategies (LEDS) that emphasize energy efficiency and renewable energy. Other activities include supporting regional energy efficiency and power grid interconnection and market development efforts; promoting regulatory and business policies that create conditions for renewable and clean energy investment; and promoting global efforts to advance new, efficient energy technologies.
2. Participation in Clean Energy Technology Partnerships
Clean Energy Ministerial (CEM): The U.S. Department of Energy (DOE), supported by funding from the Department of State, serves as the Secretariat for the Clean Energy Ministerial (CEM), a high-level global forum to promote policies and programs that advance clean energy technology, to share lessons learned and best practices, and to encourage the transition to a global clean energy economy. Participating governments account for 80 percent of global greenhouse gas emissions and 90 percent of global clean energy investment. The CEM’s 12 initiatives build on Technology Action Plans that were released by the Major Economies Forum Global Partnership in December 2009, which laid out best practice blueprints for action in key technology areas. Three of these initiatives are components of the SE4ALL Action Agenda. The Super-efficient Appliance and Equipment Deployment (SEAD) initiative creates a common technical foundation to allow governments to more easily adopt cost-effective appliance efficiency policies and programs. The Clean Energy Solutions Center serves as a first-stop clearinghouse of online clean energy resources, including policy best practices, data, and analysis tools, and shares these resources with a global forum of energy experts, policy makers, and other stakeholders. The Solutions Center offers online training, "live" ask-an-expert assistance to help countries tailor solutions to their needs and foster international collaboration on policy innovations. Global LEAP is a voluntary forum that brings together donor governments and development partners to share knowledge and best practices under a set of commonly held principles that encourage self-sustaining commercial markets for energy access solutions, with a particular focus on energy-efficient off-grid lighting. Funding commitments for these three initiatives in FY 10 and 11 total over $16 million.
Powering Agriculture: An Energy Grand Challenge for Development: The U.S. Agency for International Development (USAID), in partnership with the Swedish International Development Cooperation Agency (SIDA), Duke Energy, the African Development Bank (AfDB), the Overseas Private Investment Corporation (OPIC), and the U.S. Department of Agriculture (USDA), has launched a new program to develop and scale appropriate, clean energy solutions for farmers and agri-businesses in the developing world. The program will focus on technology and business model innovation and commercialization of solutions.
Global Alliance for Clean Cookstoves: The United States is a founding member of this Alliance, an innovative initiative led by the United Nations Foundation and with over 400 public and private partners, including 34 countries, to save lives, improve livelihoods, empower women, and combat climate change by creating a thriving global market for clean and efficient household cooking solutions. Roughly half of the U.S. contribution supports applied research on topics such as health benefits, technology development, stove testing, and adoption. The other half targets debt financing or insurance to support the manufacture, sale, and purchase of cookstoves. The Alliance’s ‘100 by 20’ goal calls for 100 million homes to adopt clean and efficient stoves and fuels by 2020.
3. Financing and Mobilization of Private Capital
OPIC: The U.S. Overseas Private Investment Corporation offers a number of products to help investors finance projects in the developing world, including debt financing, risk insurance, and new coverage for power purchase agreements. OPIC lending for renewable energy reached $1.1 billion in FY11. The OPIC commitments normally leverage at least twice as much in private investments.
MCC: The Millennium Challenge Corporation enters into Compacts with a limited number of countries that provide grant assistance to support their reform efforts in key sectors. Electrification and clean energy is a focus in several of the current and planned Compacts.
TDA: The U.S. Trade and Development Agency supports project feasibility and related technical assessment work that support exports by U.S. companies. TDA helps to ensure project soundness and often addresses key regulatory constraints developing a project financing package.
USAID/DCA: USAID has a unique loan guarantee program called the Development Credit Authority that provides partial credit guarantees on a project or portfolio basis with local banks, municipal authorities, or private companies. DCA guarantees support USAID’s development priorities across all sectors including energy, and some specific mechanisms/windows for clean energy have been established. In 2011, DCA completed 37 transactions in 21 countries, which will result in $197 million in private capital for local loans. The leveraging impact of these guarantees on local lending was 16 to 1 in FY11.
Treasury: The U.S. Department of Treasury is the lead USG agency in the provision of clean energy finance to multilateral climate and clean energy funds including the Clean Technology Fund and the Program for Scaling Up Renewable Energy in Low Income Countries. The U.S. contribution to these funds in FY11 was approximately $195 million for clean energy activities. In addition, approximately $23.4 million of the Treasury FY2011 GEF contribution went toward clean energy activities.