Climatescope’s Enabling Framework Parameter I includes a total of 22 indicators, which assess a country’s policy and power sector structure, levels of clean energy penetration, level of price attractiveness for clean energy deployment, and the expectations for how large the market for clean energy can become. Parameter I took into account a wide variety of indicators to compile a final score. This ranged from the macro in the form of overall policy scores for a country’s clean energy policy regime, to the micro in the form of kerosene or diesel prices for lesser developed nations. Parameter I contributed 40% toward each nation’s overall score. (For more on how this parameter and other were scores, please see the complete Climatescope methodology).
The average Enabling Framework score across all 55 nations for this year’s Climatescope rose to 1.15 from 1.09 in the prior year, indicating that fundamental market and policy conditions across these countries have improved. Still, given that the maximum score is 5.0, substantial work remains to be improve frameworks in these emerging markets.
A key input into Parameter I is the Clean Energy Policies indicator, the one indicator in the entire Climatescope that relies on a degree of qualitative input from 78 outside policy experts globally surveyed by Bloomberg New Energy Finance. The average clean energy policy score achieved across all Climatescope nations rose to 1.25 in this year’s study, up from 1.11 last year, suggesting steady progress overall. Thirty countries saw their scores rise on this indicator while 15 saw theirs decline (10 countries achieved the same score year to year).
Among the top five Enabling Framework scoring nations, three are in Latin America with two others in Africa. Uruguay tops the list after seeing a sharp increase in the level of clean energy generation in the country in 2014 and scoring quite well on the Clean Energy Policies indicator. Among South America’s smallest nations by population, Uruguay added 469MW of wind and solar in 2013. That, in turn, boosted the country’s low-carbon generation figures in 2014 as those projects logged a full year of service. The country appears poised for another strong year in 2015 thanks to another 902MW of renewable capacity being commissioned in 2014.
Rwanda continues to be one of Africa’s success stories thanks to its ambitious efforts to add 563MW of new clean capacity and achieve energy access for 70% of its citizens by June 2018. The country now boasts sub-Saharan Africa’s largest PV project outside South Africa, albeit at 8.5MW, while seeking to foster mini-grid development and pushing for utility reform. Renewables already supply most of the country’s power, with 57% small hydro and 6% solar; the rest is mostly diesel, suggesting further potential opportunities.
Brazil scored well on the Enabling Framework parameter, but not entirely for reasons its citizens would cheer . The country fared decently for its clean energy policy regime and for its level of biofuels production (the country is 2nd only to the US on that count). However, its score on this parameter was also boosted by a surge in local power prices in 2014 thanks to a drought that depressed large hydro power generation. Such prices make new clean energy development a more attractive proposition for developers and thus bolstered the country’s Climatescope score, but that is surely of little comfort to residents.
Brazil was hardly alone in that regard. Power prices, both at the industrial/wholesale and residential level, remained stubbornly high in most Climatescope nations in 2014, despite a precipitous decline in oil prices during the last quarter of the year. Crude prices have remained low into 2015 and the impact of that change may well be seen in next year’s Climatescope survey of power prices.
It should be noted that most of the nations that finished near the bottom of the Enabling Framework in the previous edition of Climatescope remained there once again this year. Still, there were some notable exceptions. Tajiikistan, for instance, moved from 52nd on the overall Enabling Framework list to 41st. This was primarily due to the fact that the country growth rate of installed clean energy capacity and generation both rose year-on-year.
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