Where is the Dominican Renewable Energies Fund?

This series of blogs explores current mechanisms in place to finance renewable energies in the Dominican Republic. Be sure not to miss Part 1 on the Dominican Republic’s clean energy entrepreneurs, and Part 2 and Part 3 on the Dominican Republic’s efforts to incentivize clean energy production.

The Dominican Republic established a fund to develop renewable energies that generates its revenue from a 5 percent levy on the country's fossil imports. In 2010, this represents 177 million US dollars. Source: Vital Signs Online, 2011, Worldwatch Institute

To help incentivize the development of renewable energies in the Dominican Republic, Law 112-00 of January 2000 established a national fund to develop renewable energies. The law creates “a special fund from the tax differential on fossil fuels in order to finance projects of great national interest for the promotion of alternative, renewable or clean energy and energy savings.” Generating its revenues from a 5 percent levy on the country’s fossil fuels imports, the fund would help to finance projects for the promotion of alternative, renewable or clean energy, and energy efficiency. Law 57-07 further stipulates that the fund, managed by the national energy commission (CNE), will also help pay for the nation’s renewable energy feed-in-tariff.

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clean energy, Dominican Republic, environmental policy, finance, green power, low-carbon, renewable energy finance, renewable energy sources

Part 3: Analyzing the Dominican Republic’s Public Financial Incentives to Promote Renewable Energies

This series of blogs explores current mechanisms in place to finance renewable energies in the Dominican Republic. Be sure not to miss Part 1 on the Dominican Republic’s clean energy entrepreneurs, and Part 2 on the Dominican Republic’s comprehensive legal framework regulating renewable energy technologies. 

Worldwide, growth in renewable energy has consistently been a policy-driven process. The design of supportive policies, as well as their effective implementation, has been critical in countries that were successful in developing a favorable investment climate for renewables.

Development of renewable energies in the Dominican Republic is incentivized by a comprehensive set of regulations

In the Dominican Republic, a whole corpus of domestic laws recognizing the necessity to transition the energy sector to cleaner fuels has been instituted during the past decade, culminating in 2007 with the publication of Law 57-07 and its appending regulation, which sets a solid legal foundation to incentivize renewable energy technologies development, including cost reductions policies such as tax exemptions, loans, capital subsidies, and a Feed-in-Tariff (FiT).

Yet some major barriers remain, hindering sustained growth in the renewable energy sector. The first is the length and unpredictability of administrative procedures to obtain a concession and benefit from the tax credits and tax exemptions laid out in Law 57-07. Business stakeholders have noted, however, that the process has improved considerably in recent years. A second major barrier is uncertainty regarding implementation and regulation of the FiT laid out in Law 57-07, particularly for solar development. Other barriers include a lack of capital availability, the absence of long-term, concessional commercial loans, the difficulty in accessing international financing for renewable energy and energy efficiency, and a lack of knowledge and awareness of financing opportunities and conditions of international climate finance institutions.

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BHD, clean energy, Climate Change, CNE, Dominican Republic, environmental policy, finance, financing, green power, low-carbon, renewable energy, renewable energy finance, renewable energy sources

Part 2: Clear Policy Signals To Develop Renewable Energies

This series of blogs explores current mechanisms in place to finance renewable energies in the Dominican Republic. Be sure not to miss Part 1 on the Dominican Republic’s clean energy entrepreneurs.

Far from the media spotlight, the Dominican Republic is paving its way to a cleaner energy sector. Over the past ten years, the government has published a large set of policies and laws to incentivize renewable energy production. Lifting clean-energy development to a constitutional objective, Article 67 of the Constitution of 2010 reads, “The State shall promote in the public and the private sector the use of clean alternative technologies to preserve the environment.

Law 57-07 to incentivize the production of energy from renewable sources

A whole corpus of domestic laws recognizing the necessity to transition the energy sector to cleaner fuels has been instituted during the past decade, culminating in 2007 with the publication of Law 57-07 on Renewable Sources of Energy Incentives and its Special Regimes and its appending regulation, which sets a target of 25 percent of renewable energies in the country’s final electricity consumption by 2025.  The law also aims at “opening the door” to sustained commercial financing for the renewable sector through financial incentives such as tax exemptions, a feed-in-tariff (FiT), and a national fund for renewable energies, discussed in more detail in this blog series.

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clean energy, climate finance, Dominican Republic, energy policy, environmental policy, feed-in tariff, finance, green power, low-carbon, renewable energies, renewable energy finance, renewable energy investment, renewable energy sources

Banco BHD, the only bank in the Dominican Republic with a credit line for renewables projects

This series of  four blog pieces explores current mechanisms in place to finance renewable energies in the Dominican Republic.

Overlooking one of Dominican Republic’s beautiful black sand beaches in Palmar de Ocoa, Azua, a row of seashore villas dominates the bay. Throughout this picturesque landscape one would notice whistling wind turbines and glistening rooftop solar panels. Although the first utility-scale wind farm will be connected to the grid in August 2011 — a significant landmark in the Dominican Republic’s energy transition –  the Dominican market for wind and solar energies is still largely dominated by small, off-grid installations for private homes. Wealthy Dominicans and foreign real-estate investors take advantage of the abundant solar and wind resources to power their villas with a mix of wind and solar energies technologies. Such power supply however, is an exception in the Dominican Republic, where more than 90% of electricity generation comes from imported fossil fuels.

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Caribbean, clean energy, Dominican Republic, environmental policy, finance, green power, low-carbon, renewable energy, renewable energy finance, renewable energy sources

By Haibing Ma and Jiajing Bi

China is the World's No.1 wind power

As China accelerates its shift to a green economy, it is becoming a frontrunner in the clean energy field. In 2009, the country overtook the United States to become the global leader in clean energy investment, and in 2010 this Chinese investment reached US$54.4 billion, dwarfing the $34 billion from the U.S. With such impressive finance and investment, it’s no wonder that China’s clean energy sector has been growing so rapidly. By the end of 2010, China had installed a total of 44.7 gigawatts (GW) of wind capacity, surpassing the United States to become the world’s biggest wind power market. And China has been the world’s largest solar photovoltaic (PV) producer since 2008, with an annual production capacity of 20 GW at the end of 2010.

Chinese manufacturers of clean energy equipment account for more than half of the global supply. Even more impressive is the pace of growth in renewable energy: as recently as 2005, only about 1 GW of wind power capacity was installed across China, and solar cell production was less than 500 megawatts (MW).

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China, clean energy, Climate Change, emission reduction, green economy, green jobs, manufacturing, renewables, solar, solar PV, sustainable development, wind, wind turbine

By Camille Serre and Alexander Ochs

After having shed some light on French climate and energy legislation, let’s proceed with our review of European progress toward clean energy economies. Typically, the Scandinavian countries and Germany have set the example in the European renewables field. Yet lately, a Southern country—Portugal—has attracted media attention after delivering its National Renewable Energy Action Plan to the European Commission this June.

Portugal has made dramatic changes in its energy policy over the last five years under the government of Prime Minister Jose Socrates. The country’s installed renewable energy capacity more than tripled between 2004 and 2009, from 1,220 megawatts (MW) to 4,307 MW, and renewables now represent roughly 36 percent of electricity consumed. Thanks to this performance, Portugal currently ranks 4th in Europe in energy production from renewables. Socrates seems to know what he is doing, and it looks like his previous experience has paid off. Like Germany’s chancellor Angela Merkel, Socrates was Minister of the Environment before becoming head of his country’s government. The environment seems to be a springboard for European politicians’ careers.

In 2009, Portugal ranked 3rd in Europe in wind power capacity per capita - Flickr Creative Commons / Mafalda Moreira Santos

Of course, Portugal benefits from favorable conditions for renewables as well: a strong wind resource, great hydropower, good tidal waves potential, and a high sunshine rate. After the country removed several dams in recent years, Socrates’ government has focused instead on wind power development, under most conditions the cheapest renewable energy source after hydropower. With spectacular growth in wind energy production of over 600 percent between 2004 and 2009, Portugal now ranks 6th in Europe in total installed capacity and 3rd in capacity per capita, behind only Denmark and Spain. Some even expect Portugal to overtake its neighbor Spain in per capita wind energy production as early as this year.

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clean energy, climate, Climate Change, climate legislation, energy, Europe, feed-in tariffs, low-carbon, Portugal, renewable energy, solar power, wave power, wind turbines

Phil Giudice

By Phil Giudice, commissioner of Massachusetts’s Department of Energy Resources

Clean Energy is not some distant dream awaiting federal decisions; in the state of Massachusetts, we have gotten busy.

Massachusetts has a long been a hot bed of innovation. Under Governor Deval Patrick, our innovative zeal has turned full force to our energy challenges, and the early results are impressive. 

First and foremost, our focus is on finding every cost-effective intervention to reduce energy waste. These energy efficiency efforts were unleashed through the Commonwealth’s passage of the Green Communities Act in 2008—comprehensive clean energy legislation that, among other things, mandates that electric and gas utilities procure all cost-effective energy efficiency on behalf of their ratepayers. With more than 20 years of substantial and continuous experience investing in cost effective energy efficiency, we have capable and committed partners in our utilities, contractors, vendors, and other stakeholders to help us figure out exactly how best to find and deliver all energy efficiency that makes economic sense. 

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clean energy, energy efficiency, Massachusetts, renewable portfolio standard, solar power, states, United States, utilities