Financing needs for climate action are most acute in EMDEs, where finance flows will need to quadruple from USD 800 billion today to USD 2.4 billion annually by the end of the decade. There is no shortage of globally available capital. OECD and G20 institutional investors alone have at least USD 64 trillion of assets under management (OECD, 2020). Yet these institutional investors hold only USD 1.04 trillion in infrastructure assets, of which only USD 314 billion are green infrastructure assets, mostly in OECD countries. So the trillion-dollar question is how to mobilise private capital for climate action in EMDEs, especially in clean energy.
At country level, country platforms (including Just Energy Transition Partnerships or JETPs launched in Indonesia, South Africa, Viet Nam and Senegal as well as Egypt’s Country Platform for the Nexus of Water, Food and Energy, Program) are very useful platforms to facilitate whole-of-government and whole-of-society engagement and shift from a project-level approach to a more strategic and programmatic approach. However, country platforms will not suffice to mobilise private finance and build capacity at sufficient scale and speed.
This High-Level Plenary focused on the actions needed to scale up the mobilisation of private finance towards clean energy in emerging economies, whether at country, regional or global levels.
This session aimed to achieve the following objectives:
- Discuss the drivers and barriers of investment funds’ clean energy investment allocation to EMDEs;
- Identify which policy changes are required to incentivise private investment in clean energy in EMDEs;
- Discuss emerging lessons learnt on the role and effectiveness of country platforms, such as Just Energy Transition Partnerships.