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084 SUSTAINABLE ENERGYSCALING UP RENEWABLE ENERGY TO MEET THE CLIMATE CHALLENGEThe Paris Agreement signed by 195 countries in December 2015 represents a turning point in the transition to a low-carbon economy. For the energy sector in particular, the agreement and associated targets mean that we need an urgent and industry-wide transformation in order to achieve the 1.5°C or even 2°C limit. As of 2015, renewable energy accounted for around one quarter of global electricity production. Based on an assessment of policies in place or announced in 2015, renewables are projected to become the leading source of electricity by 2030.But this is not enough. At least an additional 1,500 GW of renewable energy capacity is needed by 2025 in order to limit climate change to below catastrophic thresholds. This is approximately double what business-as-usual investment and policy is likely to deliver. Scale is important, and so is distribution. Energy is the engine of development in the modern age; it has enabled the human race to reach new heights, raising living standards across the globe and helping us to achieve some of our greatest goals. The importance of energy access for social, economic and sustainable development is recognised in Sustainable Development Goal 7: Ensure access to affordable, reliable, sustainable, and modern energy for all.While the challenge is significant, it is surmountable. We are on the cusp of a clean energy future. With technologies that have been more recently developed, the sector has one of the biggest opportunities to be a major contributor to a low-carbon, sustainable world. Recent advancements and cost reductions in renewable energy technology present substantial opportunities.PETER BAKKER, PRESIDENT AND CEO, WORLD BUSINESS COUNCIL FOR SUSTAINABLE DEVELOPMENT (WBCSD)Firstly, renewable energy is increasingly competitive. In some markets such as Chile, unsubsidised renewable energy outbids conventional energy. Wind is competitive with conventional generation across a wide range of markets, while solar PV is experiencing dramatic cost reductions across the globe. New solar PV plants in the Middle East have been contracted for US$50-60 per MWh, in Mexico for US$80-90 per MWh and in Germany for US$100 per MWh. India has also seen dramatic cost reductions with recent contracts awarded as low as US$60-70 per MWh.Secondly, renewable energy is technically reliable. Not only do dramatic improvements in forecasting and control mean that renewable energy can be operated in a similar way to modern conventional plants, but renewables are capable of providing system support services. In the most mature markets, renewable energy is now being specifically harnessed by operators and rewarded by markets. Take the examples of Germany, Denmark and Spain, where renewable energy penetration exceeds 20-30 per cent.Thirdly, deploying renewable energy brings wide-ranging benefits. In addition to lower CO2 emissions, renewable energy has environmental, socio-economic and technical benefits such as improved local environmental quality, energy security, job opportunities and local economic development and increased flexibility and resilience of electricity systems. Moreover, there is a growing demand from investors for renewable assets, with institutional investors such as pension funds and insurance funds showing strong appetite.However, there are still challenges – particularly in terms of integrating a higher penetration of renewables into electricity grids, and scaling finance for renewable energy projects. Below: Peter Bakker