Malcolm Turnbull is a former Prime Minister of Australia and a director of the International Hydropower Association. His memoir "A Bigger Picture," was published last year.
The Intergovernmental Panel on Climate Change, or IPCC, report sets out in the starkest possible terms the threats to the planet caused by climate change. If you still doubt the science, just switch on the television and see if you can avoid the news reports of floods, fires or droughts around the world. Unless we stop burning fossil fuels, and dramatically reduce our greenhouse gas emissions, our world is doomed.
The IPCC report sets out the starting point -- we must decarbonize the electricity grid. We, of course, need much more solar and wind energy. But what is often forgotten is that we also need long-term, large capacity energy storage for when the wind does not blow and the sun does not shine. Unless we address that challenge now, we will either fall back on fossil fuels or face blackouts as our electricity supply becomes unreliable. This need for energy storage is the ignored crisis within the crisis.
While lithium batteries can play an important role in storing electricity for a few hours, the only proven low carbon technology for storing electricity for longer periods is hydropower. The International Energy Agency, or IEA's executive director Fatih Birol has described hydropower as the "forgotten workhorse of renewables" and the IEA's report "Net zero by 2050: a roadmap for the global energy sector" shows we need substantially more wind, solar and hydropower.
There are encouraging signs that policymakers are responding to the climate crisis. There is increased takeup of renewables and their prices are coming down fast, green stimulus packages are evolving, the world's biggest economies and companies are committing to net-zero targets, and there appears to be a massive increase in environmental, social and governance, or ESG, investment.
However, green investment in sustainable hydropower is still woefully inadequate. Despite compelling evidence of its central role in providing clean energy and supporting variable renewables, hydropower is undervalued as an essential backup to wind and solar in the energy transition, while some countries still fail to even recognize hydropower as renewable.
Despite being a proven technology, developers around the world are struggling to get new projects off the ground. The frameworks that enabled hydropower in the past -- vertically integrated and often state-owned utilities -- have given way to deregulated markets that do not provide revenue certainty to support this level of investment in infrastructure. An unregulated market only rewards electricity generation, not storage or flexibility.
The IEA report states that we need a doubling of installed hydropower capacity by 2050 if we are to meet the net-zero targets. This means we need to build roughly the same in the next 30 years -- 1,300 gigawatts -- as we built in the past 100. At present we are growing hydropower capacity at about 1.6% per year -- half the pace required. And, if you take China out of the equation, the story is more alarming because that is where the majority of hydropower is being built. All around the world, even easy wins like modernizing existing facilities, building off-river pumped storage or electrifying existing nonpowered dams are taking too long to get off the ground.
The cost of solar and wind energy is dropping all the time, and it is getting faster to deploy. But there is a real risk that national storage capacity will not keep up with renewable generation. It takes less than a year to build a solar farm. A wind farm takes maybe three years. A hydropower project however takes much longer due to its complexity -- meaning we need investment decisions now, as I did when I launched the 2000-megawatt Snowy 2.0 pumped-storage scheme linking upper Tantangara and lower Talbingo dams through tunnels and an underground hydropower station, currently under construction and due to be completed in 2025.
Policymakers have a huge opportunity to correct this through their COVID recovery plans. Due to hydropower's long lead-in times, if we do not build in the next three to five years, then the world may not have enough hydropower capacity to support the transition to net-zero. There will be a real risk that decarbonization will stall, just as it needs to accelerate.
As we look ahead to the 26th U.N. Climate Change Conference of the Parties, or COP26, amid the unprecedented momentum toward the clean energy transition, policymakers need to incentivize investment in sustainable hydropower right now. They should start by putting in place incentives for new projects and providing de-risking mechanisms for investors such as long-term contracts, price floors and public-private partnerships. The U.K.'s Contracts for Difference scheme shows how the right type of government intervention can unlock huge private sector investment in low carbon technology delivering offshore wind at a scale and a low cost to consumers that were previously inconceivable. We need the same ambition for sustainable hydropower.
Policymakers also need to develop holistic energy and economic development plans -- whole grid and interconnectivity within countries and also within regions to maximize complementarities between renewable energies, not just technologies in isolation. COVID recovery packages should plan for net-zero by supporting clean energy investments such as setting up green-industrial parks and producing green hydrogen with hydropower.
At the same time, the hydropower sector itself has to step up. Next month, at the World Hydropower Congress, leaders from governments, companies, civil society and international financial institutions will share what the sector has learned while also charting a course for the future.
The industry is set to commit to an independent sustainability standard that has been devised by governments, NGOs, international financial institutions and companies. There will be no excuse for any hydropower developer to fall short of international good practice. If governments play their part and the private sector commits that no hydropower project goes ahead unless it meets this standard, then we can contemplate a fully green, clean, modern and affordable electricity supply by 2050.