7. Substantially increasing investments in renewable energy can be part of an integrated strategy to green the path of global economic development. Modelling studies carried out for the Green Economy Report (GER) project that an average annual investment of approximately US$ 650 billion over the next 40 years in power generation, using renewable energy sources and second-generation biofuels for transport, could raise the share of renewable energy sources in total energy supply to 27 per cent by 2050, compared with less than 15 per cent under a business-as-usual (BAU) scenario. Increased use of renewable energy sources could contribute more than one-third of the total reduction in greenhouse gas emissions (GHG) of 60 per cent achieved by 2050, relative to BAU.
8. A shift to renewable energy sources brings many new employment opportunities, but not without transitional challenges. Due to the higher labour intensity of various renewable energy technologies compared with conventional power generation, increased investment in renewable energy will add to employment, especially in the short-term, according to modelling conducted for the GER. Overall impacts on employment of investing in renewable energy, taking into account possible effects in fossil fuel-related sectors, will vary by national context, depending on supportive policies, available resources and national energy systems.
9. Policy support will need to be expanded considerably to promote accelerated investment in renewable energy. These investments carry enhanced risks, such as those typically associated with the development and diffusion of new technologies, exacerbated by high upfront capital costs. A range of public support mechanisms have been developed to mitigate risks and to enhance returns. The growing competitiveness of renewable energy has been achieved in part due to policy support to overcome barriers.
10. Government policy to support increased investment in renewable energy needs to be carefully designed in an integrated manner; there is no one-size-fits-all approach. The range of regulatory policies, fiscal incentives and public financing mechanisms to support renewable energy is broad and can be complemented with support to R&D as well as other measures, such as those to stimulate investments in adapting grid infrastructure. The diversity of circumstances among countries, including existing energy systems and potential renewable development, requires that policy frameworks be carefully designed and tailored to specific situations.