New energy methods a chance to grow

Weekend Australian
Saturday 15/3/2008 Page: 17

RENOVATING buildings to make them more energy efficient means billions of euros in savings as well as less stress on the environment, says Wolfgang Tiefensee, Germany's minister for construction and transportation. Creating demand for solar, wind and biofuel products also gives underdeveloped regions such as eastern Germany a chance for economic growth, Tiefensee says. Europe's biggest economy is home to solar energy companies including Q-Cells AG and Solarworld AG.

Energy policy around the world is being challenged by record prices for oil, global warming and political tensions in traditional energy-producing regions such as the Middle East, according to Merck Finck analyst Timo Graucob. Governments are negotiating a new agreement to replace the Kyoto Protocol, which expires in 2012, to reduce carbon dioxide emissions, the by- product of burning fossil fuels.

"We have to see not only the gloomy aspect of the current situation, but also the unbelievable chances that are offered," said Tiefensee, who with experts from the solar and building industry are meeting in Berlin to discuss ways to reduce energy use and increase the installation of solar systems in buildings.

Solar and other renewable power sources will offer countries greater energy autonomy and force a change in the way that cities and buildings are designed and constructed, says Hermann Scheer, president of Eurosolar, a European solar energy association. Buildings use almost half of all energy produced in developed countries, Scheer says. New technology such as solar panels offers owners the chance to produce energy on their own, creating a decentralised, more secure system.

"We are now at the stage when we can see this happening," said Scheer in Berlin. "This is a debate that began a century ago with Thomas Edison and now has the potential to be reality. This is the unique opportunity, but we're running out of time." Edison, the US inventor of the light bulb, proposed in the early 20th century that households produce their own electricity, mainly by burning coal, says Eurosolar's Hermann, adding that the plan at the time would have been "very polluting."

Westinghouse Electric successfully countered Edison's idea with a system of centralised electricity that would be generated at power plants and transported to houses. solar energy offers the best opportunities for investors seeking returns from renewable energy companies because the technology is becoming affordable and there is the potential for a large volume of equipment to be installed, according to Merck Finck's Graucob.

Global investment in sustainable energy reached about $85 billion last year, more than tripling from $27.5 billion in 2004, according to the United Nations Environment Program. That figure will have to increase to between $650 billion to $700 billion worldwide by 2012 to minimise climate change, according to Michael Liebreich, chairman of the consulting firm New Energy Finance.