In an attempts to curtail the negative effects of climate change, the Asian Development Bank has called for a massive investment of $10 billion in solar power to make this technology competitive enough to rival conventional energy sources.
The targets are tough. As per Reuters, “the ADB wants Asia, home to about two-thirds of the world's population, to add 3,000 megawatts of solar energy capacity by the end of 2013.”
The countries that will be targeted are densely populated and boast emerging economies, hence they are already energy-starved – these include China, India and Pakistan, where some solar power projects are already up and running.
The ADB hopes to create an environment where commercial lending from banks is rife and private investment is encouraged, so as to bolster the industry from the financial perspective. This is vital because currently the cost of setting up solar panels is pretty high and it is only economical in areas where the national electric grid is unavailable.
Nevertheless, research and development in this area has greatly reduced the cost of manufacturing efficient photovoltaic cells (which are used to create solar panels) and further funding promises better returns.
Other financial institutions are beginning to realize the importance of solar energy in Asia. For instance, Grameen Shakti, a microfinance institution in Bangladesh, offers microloans to buyers and suppliers of solar power, and these projects are quite affordable.