Can you put a value on the collective voice? How about up to $1 trillion in global subsidies the fossil fuel industry enjoys every year according to Oil Change International. It doesn't stop there. This powerful incumbent lobbies to ensure the playing field is not level for renewable energy markets, distorting everything from the generation price to the attractiveness of investments.
The fossil fuel industry has something that we desperately need: a powerful lobby.
Our voice could unite behind a collective megaphone to blast our needs to governments and Multilateral Development Banks (MDBs) if we were to rally behind one industry body with a common, unified purpose. To put it in perspective, the three year total (2011-2013) of four MDB investments into off-grid solutions globally was $176 million, or .00006% of the $3 trillion the fossil fuel industry enjoyed in subsidies alone for the same period. As GIS and IISD put it in their 2014 report called, "The Impact of Fossil Fuel Subsidies on Renewable Energy Generation":
"Tax breaks are frequently granted on the basis of political influence and connections, meaning that established entities that have the institutional capacity to exert influence on the political process -- usually fossil fuel based generators -- have an advantage over new entrants such as renewable energy sources, which lack the ability to press for special treatment."
Jigar Shah, founder of Sun Edison and President of Generate Capital, understood the need to gather a collective voice when he helped form the Coalition for Affordable Solar Energy (CASE). CASE rallied solar installers to fight proposed tariffs on imported solar panels. "A unified voice is necessary to focus and magnify the power of new industries against established incumbents. Without it, our needs fall on deaf ears."
We can learn from these lessons and follow historical examples to do better.
In the 1970s the Solar Energy Industry Association (SEIA) of America united players behind a core issue that would pave the way for decades of attractive, venture worthy growth. The Solar Investment Tax Credit (ITC) served as the common denominator, headed up by Sheldon Butt and the 93rd Congress and formed the foundation for SEIAs industry lobby.
SEIA demonstrates a critical case study for the Beyond the Grid Industry. The national organization is a central hub that supports state level efforts on legislative challenges, providing resources, belt-way lobbying and other support to clear the way for market growth. We can draw on a similar model for a strong Global hub that supports country specific lobbying with boots on the ground to clear the way for favorable market conditions. Take for example the successful efforts of the Global Off Grid Lighting Association (GOGLA) to lobby against the revitalization of value added tax in Tanzania. With a strong, financially backed lobbying effort, the Tanzanian case could be scaled globally. Other obvious targets are removing unfavorable import taxes, phasing out dirty fuel subsidies, and working with MDBs and International Finance Institutions (IFIs) for loan guarantees and dedicated funds in annual budgets. Lobbying does exist, however in a small, slow and fragmented way that could be expedited more judiciously with exponentially greater results.
Sean Gallagher, Vice President of State Affairs for SEIA explains how critical it was for the success of the solar industry to rally behind a unified industry voice:
"Today, the U.S. solar industry is experiencing record growth, in large part, because of its ability to work together to affect positive change. Most notably, the industry has pulled together to embrace smart, effective public policies such as the solar Investment Tax Credit (ITC), Net Energy Metering (NEM) and Renewable Portfolio Standards (RPS). By any measurement, these policies are paying huge dividends for both the American economy and our environment. Despite being outspent, outmanned and outgunned in many states, a unified solar industry has repeatedly beaten back nefarious attempts to eliminate pro-growth, pro-solar policies. This would have not been possible without a strong national organization like SEIA in place."
Koen Peters Executive Director of GOGLA explains how the time has come that we do the same:
"GOGLA sees the market for solar lighting and electrification growing very fast: However, we are also concerned about the significant barriers we encounter as this market evolves -- only if governments, investors and donors all work hand in hand with the industry we can realize the potential. Right now, the time has come to shift gears, and we are calling on these actors to respond to that. We need to move from support for innovative business models that electrify households, towards support for innovative markets that electrify countries. At GOGLA we seek to facilitate this discussion by acting as the voice of the industry. "
Imagine if instead of the millions of dollars spent on development and technical advisory we spent it on a strong industry lobby that forced IFIs to create the funds we've been demanding all these years -- and cleared the policy barriers to have a level playing field? Where then would our market and companies be today?
Only a financially attractive, fast growing commercial market will tackle energy poverty. Without it, we are left with many scattered, diluted and tangential efforts blending advocacy, development, charity and social impact that ultimately slow down and dilute our market growth and delay success of our companies.
Here today is a call to action for industry players to follow in the footsteps of SEIA and CASE and rally behind one industry voice -- not someone else to speak for us. The need for the industry is to stand up and demand what we need, not what others think we need. We quicken our results by rallying behind our Industry Association by supporting efforts with membership fees, developing a robust trade show and funneling financial support to one body to execute the collective interests.
Follow Daniel Tomlinson on Twitter: www.twitter.com/D_Tomlinson
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