World needs investment of $45tr by 2050 in alternative energy

Abu Dhabi: The world needs investments of up to $45 trillion by 2050 in alternative energy to balance hydrocarbons and renewables in its overall energy mix, the global head of asset management for Deutsche Bank said yesterday.

"Governments need to stimulate investment in clean energy through long-term policy initiatives," Kevin Parker said during a panel discussion at the second edition of the World Future Energy Summit in Abu Dhabi.

Parker said Deutsche Bank has currently $650 billion of assets under management, of which one per cent, or $6.5 billion, of assets are under management in climate change.

Vivienne Cox, chief executive officer of BP Alternative Energy, said alternative energy forms, inluding hydro power, currently comprise three per cent of the total global energy mix.

"Wind power, solar energy and geothermal energy together comprise about 1.5 per cent of the world's total energy output. This could easily double over the next five years," she said.

Parker said governments worldwide need to put a price on carbon backed by strong policies that encourage replacement of fossil fuel.

Paul Dickerson, former chief chief operating officer of the US Energy Department Energy Efficiency and Renewables said the solution lies in commercialising clean energy.

"The interest around the world in renewable energy is strong. The use of renewable energy has to increase and energy conservation is a must," he added.

Dr Sultan Al Jaber, chief executive of Abu Dhabi's $15 billion Masdar initiative said they are already doing carbon sequestration for clean energy.

Renewable energy sources will account for at least seven per cent of Abu Dhabi's power generation capacity by 2020.

Lady Judge, chairman of UK Atomic Energy Authority, said nuclear energy must not be excluded from solutions that have been envisaged to tackle negative impact of hydrocarbon usage, despite high costs involved in building nuclear reactors.

"While it is not the answer, it is an answer," she said.

Panelists hoped that despite the recent slide in international oil prices resulting from the global economic downturn, countries of the world would continue to invest in increasing their usage of alternative forms of energy.