Sustainability challenge and related SDGs:
Over the past 100+ years, fossil fuels have become the dominant energy source. Though they have fuelled economic growth over the past century, burning fossil fuels leads to increased greenhouse gas emissions and is the main cause of today’s climate crisis. Furthermore, fossil fuel prices are largely dependent on the will of the suppliers and are, therefore, subject to artificial scarcity that can lead to price spikes.
SDG 7 “Affordable and Clean Energy” accurately describes the challenges associated with fossil fuels. For many people, they are neither affordable nor clean. However, sustainable development can only be achieved through energy sources that do not harm the environment and allow energy provision at a low cost. Moving away from fossil fuels is one of the most urgent actions we must take to tackle the climate crisis. Thus, the implementation of SDG 7 also contributes directly to SDG 13 “Climate Action”.
Primarily impacted SDGs: 7, 13
- 7.Affordable and Clean Energy
- 13.Climate Action
Possible solutions and their contribution to achieving the SDGs
The raditag #Solar covers everything related to harnessing energy from the sun, from the materials and machines needed to manufacture solar cells and modules to construction, operation and related services. Multiple solar cells combined form a solar module, which is then integrated into a photovoltaic system to provide electricity. Additionally, solar thermal collectors are sometimes known as solar panels. Therefore, #Solar encompasses both the capturing of heat and the generation of electricity from sunlight.
Even before the recent price increase of fossil fuels, the sun has often been the cheapest source of energy available. Aside from that, it is also a safe option and, of course, a renewable energy source. Innovation advances so fast that almost every panel installed is more technically elaborate than its predecessor.
Three out of four people without electricity live in sub-Saharan Africa. For them, being able to access electricity or heat through solar energy means, above all, accessing affordable energy. Below are all the SDG targets to which #Solar contributes:
- 1 “By 2030, ensure universal access to affordable, reliable and modern energy services”
- 2 “By 2030, increase substantially the share of renewable energy in the global energy mix”
- 2 “Integrate climate change measures into national policies, strategies and planning”.
Primarily related SDG targets: 7.1, 7.2, 13.2
Investment Rationale and Growth Potential
The transition from fossil fuels to renewable energy sources is inevitable. Over the past five years, the average annual growth in solar energy has been 27%. This pace must at least be maintained to meet the ambitious targets set by various countries, which aim at a nearly tenfold overall increase in #solar capacity between 2020 and 2030. Trillions of dollars are still needed to complete the much-needed energy transition. To address the climate crisis, rapid action is of the essence. Most large-scale #solar projects are, therefore, still subsidised. But projects have begun to emerge that compete at market rate without subsidies. Regardless, the demand for #solar energy is very high and will continue to grow, making it an attractive opportunity for long-term investors.