The International Renewable Energy Agency has said that for energy systems to be compatible with the 1.5°C pathway, a $131 trillion worth of investments will be required by 2050, and 80 percent of this figure must go into energy transition technologies.
The clean energy agency also said in a statement that as governments and energy corporations throughout the world make bold commitments to cut carbon emissions to net zero by 2050, the impetus for the battle against climate change is now stronger than ever.
However, fulfilling these commitments requires substantial financial reallocation toward low-carbon technologies, including renewables, and mobilising all available funding sources.
“To fill the funding gap for scaling up renewable energy projects in developing countries, IRENA launched the Energy Transition Accelerator Financing Platform (ETAF) in 2021 at COP26,” according to the statement by the agency.
“The platform is a multi-stakeholder climate finance solution dedicated to advancing the global energy transition by mobilising and directing close to $1 billion into renewable energy projects in developing markets.”
The statement said that with ETAF now operational and open for project submission under IRENA’s management, the Agency held a high-level ministerial dialogue between ETAF partners and stakeholders on 15 January, at the 13th IRENA Assembly in Abu Dhabi.
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“The goal of the event was to discuss the platform’s role in accelerating the energy transition in developing economies,” the statement said.
“The support of our partners has enabled us to mobilise close to our initial target of $1 billion at the end of 2022.”
Francesco La Camera, director-general, IRENA said in the statement, “We have capitalised on this momentum to continue discussions with additional partners.
“In addition to raising funds, ETAF’s responsibility is to offer a strong project pipeline to meet the requirements set out by financial partners.”
Also, ETAF capitalises on the UAE’s climate finance market as the country committed an anchor investment of $400 million through the Abu Dhabi Fund for Development during the platform’s launch.
Nawal Al-Hosany, the UAE’s permanent representative to IRENA, reaffirmed the country’s commitment to the cause by noting that, by 2050, investments in green energy technology are expected to total at least $100 trillion.
“No nation or business can manage this investment alone. To achieve this goal, we require the cooperation of governments, international organisations, development banks, and the private sector,” she said.
Speaking about how the accelerator platform can help mitigate investment risks in developing countries struggling to secure sufficient capital, Mahmoud Mohieldin, the United Nations secretary general’s special envoy on financing the 2030 Sustainable Development Agenda said there are many solutions, but the first task is to diversify investment sources.
“In a world that is suffering from a variety of crises including the war in Ukraine, for our transition to be just, it must be rapidly accelerated through different sources of finances. ETAF acts as a key accelerator in doing this,” he said in the statement.
Rodrigo Salvado, director general, operational Partnership Department, Asian Infrastructure Investment Bank, discussed the need for encouraging accountability, transparency, and more efficient spending.
He also said that while raising money is crucial, his organisation, being a project-focused bank, puts more emphasis on the spending side, that is, it moves the money which is already there.
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