Renewable energy growth for developing countries by BRICS

By Editor


New Development Bank (NDB), established by BRICS countries in sixth annual summit held in July has decided to give emphasis to sustainable development with focus on renewable energy.

The BRICS countries constitute Brazil, Russia, India, China and South Africa.

The purpose of NDB, located in Shanghai will be to provide loans and technical assistance to developing countries.

NDB has conceived two innovative ideas during the summit like it will be run by southern hemisphere countries that are in the growing stages of development and the second one was the renewable energy promotion.


Considering the dynamic link between renewable energy and sustainable expansion, the importance of continuing international efforts are reaffirmed, aimed at promoting the deployment of renewable energy deployment and technologies, taking into account national policies and resources, states, BRICS group’s Fortaleza Declaration.

The priorities of World Bank and other multilateral development institutions has shifted by providing less funding for renewable energy projects which is one of the reason behind the formation of NDB. Even if many renewable energy projects get financed it depend on the demand by other developing countries, said, Kathryn Hochstetler, CIGI Chair of Governance, Americas, Balsillie School of International Affairs, professor, political science, University of Waterloo.

The NDB will be less policy-oriented and more project-oriented. Because of this, the NDB can invest in regional projects or large-scale solar projects without imposing policies, serving several countries at one go. NDB can also encourage the World Bank to become more efficient by implementing renewables projects quickly, explained, Stephany Griffith-Jones, financial markets program director, The Initiative for Policy Dialogue (IPD), Columbia University.

Already, China, India, and Brazil have nationalized production of some components of wind and solar electricity, and South Africa is planning to do so. Hence, NDB will consider on renewable energy projects that will use those components, or the services of BRICS’ firms in installing them. In addition, NDB will prefer to make loans available to projects that support its members, commented, Hochstetler.

Additional clean energy investments by NDB should be encouraged, along with further investment by the World Bank and other existing institutions. The BRICS bank has the potential to mobilize significant resources and to use these resources to leverage larger sums of private capital, said, Nigel Purvis, president, CEO, Climate Advisers, Washington.

In 20 years the NDB could be lending around $35 billion a year for renewable energy developments, added, Purvis.

Russia, with its massive fossil fuels production is considered as an odd member but will not hesitate to help renewable investment in countries that don’t import Russian fuels like the African nations, mentioned Griffith-Jones.

NDB will help to disseminate those improvements to other developing countries, rather than disseminating their many environmental failures, concluded Hochstetler.

The International Energy Agency has estimated that investments of a trillion dollars a year in clean energy will be required to meet climate safety goals.

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