Looking for more information? Here’s everything you should need.
Switch to clean energy will cuts costs, create local jobs and save millions of lives LONDON/NEW YORK, JULY...Read More
Falling battery prices and the decarbonisation of transport systems in emerging markets will reduce...Read More
Fossil fuel electricity generation has peaked worldwide as emerging market countries seize the opportunities of low-cost renewables.
Emerging markets are key to the global energy transition, with 88% of the growth in electricity demand between 2019 and 2040 expected to come from emerging market countries. If they do not leapfrog to renewables, the report warns there will be no global energy transition.
Renewables are already the cheapest source of new electricity in 90% of the world which means emerging markets have no need to build up huge electricity infrastructure based on fossil fuels.
Leapfrog means growth
The emerging market electricity leapfrog is that process whereby emerging markets get their growth in electricity supply from non-fossil sources. The leapfrog is from the current system direct to modern renewables without passing through the intermediary stage of building up a huge electricity infrastructure based on fossil fuels. The diagram shows how this works.
Types of Leapfrog
The story of the energy transition is more nuanced for emerging markets than for advanced economies — and offers more opportunity. Emerging markets have several energy transitions underway simultaneously. These include: a shift from traditional biomass to modern energy; a shift in patterns of energy demand thanks to rapid urbanisation and industrialisation; deeper integration into and influence in global energy markets; and the imperative of cleaning up the energy mix due to a shrinking carbon budget.
These developments indicate that market size and technology developments could enable a double/triple leapfrog, namely increasing access to energy, rapid electrification of productive sectors of the economy, and a growing share of renewables in that electricity mix. This kind of transformation has not happened in the developed world, which has historically followed a more linear trajectory in energy transitions.
How to speed up the emerging market leapfrog
- Identify the right targets
- Stop financing fossil fuels
- Technology and policy transfer
- Reduce the cost of capital