Clean Technologies and Environmental Policy (2018) 20:227 https://doi.org/10.1007/s10098-018-1500-z EDITORIAL Santanu Bandyopadhyay Published online: 3 February 2018 © Springer-Verlag GmbH Germany, part of Springer Nature 2018 Renewable electricity has been projected as the most impor- bidirectional causality between the renewable energy con- tant step towards reducing emission and achieving overall sumption and the economic growth (Saad and Taleb 2018), sustainability in the electricity sector. There is no doubt that highlighting the fact that capital investment in renewable the potential of renewable energy is sufficient for the present sector pays off over a long time horizon and even helps in consumption (conversion of a small fraction of the available economic growth. The International Renewable Energy solar radiation to electricity is sufficient to meet the present Agency observed that globally competitive procurement and need of the entire world). However, the levelized cost of auctions are very rapidly driving down the costs of renew- renewable electricity, primarily due to huge capital invest- able electricity through best project development practices, ment, is seen as a hindrance towards achieving this goal. A innovations in the conversion technologies, and reductions recent comprehensive report from the International Renew- in the project risks (IRENA 2018). In essence, economic able Energy Agency highlights an opposing, yet welcomed, activities, along with appropriate policies, play an important portrait on the cost of renewable electricity. It reports that role in reducing the cost of renewable electricity. the renewable power generation costs have achieved grid- In the present time, fossil fuel dominates the overall fuel parity for many renewables and for others, it will continue to mix for electricity generation. The International Renewable fall and touch the rope in near future (IRENA 2018). Energy Agency estimates the cost in the range of 5¢–17¢ per Renewable energy-based system has already been dem- unit of electricity for fossil fuel-based power plants in the onstrated to be a cost-effective solution for remote locations developed countries. The report observed that the grid-parity where the extension of the existing grid is uneconomic. In has been achieved by renewable projects, commissioned in many remote locations, especially for islands, cost of renew- 2017. These projects are based on hydro (5 ¢/kWh), wind able electricity is much lower than the electricity produced (6 ¢/kWh), biomass (7 ¢/kWh), and geothermal (7 ¢/kWh) from fossil fuels (Bandyopadhyay and Desai 2016). This sources. The global weighted average cost of electricity from is in purely economic terms, without even considering the solar photovoltaic is almost there with a present cost of 10 ¢/ social cost of emissions from the fossil fuel-based power kWh (IRENA 2018). In specific locations, the levelized cost plants. There is a relation between the high capital invest- of renewable electricity is lower than these global average ments associated with renewable energy and the overall values. With favourable policies are in place, the effective economic growth of a country, especially developed coun- costs for renewable electricity are expected to be even lower tries. In a recent article, Saad and Taleb (2018) discussed the in the near future. With such a positive trend, future is not Granger causality between the renewable energy consump- very far away, when we are expected to achieve the total tion and the economic growth. Based on the data for 12 renewability in the electricity sector. countries in the European Union, it was demonstrated that, in the short run, economic growth helped in establishing the renewable energy sectors. This is definitely catalysed References by the favourable governmental policies and tax rebates Bandyopadhyay S, Desai NB (2016) Cost optimal energy sector plan- in these countries. However, in the long run, there exists a ning: a pinch analysis approach. J Clean Prod 136:246–253 IRENA (2018) Renewable power generation costs in 2017. Interna- tional Renewable Energy Agency, Abu Dhabi * Santanu Bandyopadhyay Saad W, Taleb A (2018) The causal relationship between renewable email@example.com energy consumption and economic growth: evidence from Europe. Clean Technol Environ Policy 20:127–136 Department of Energy Science and Engineering, Indian Institute of Technology Bombay, Powai, Mumbai 400076, India Vol.:(0123456789) 1 3
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