The International Energy Agency (IEA) has said there is desperate need for a seven fold increase in clean energy financing in emerging and developing economies in the next 10 years if global warming is to be capped at tolerable levels.
According to the IEA, financing needs to move from its present $260 billion to nearly $2 trillion in order keep temperatures from rising to catastrophic levels, annual investments in non-fossil fuel energy in emerging and developing economies.
“Financing clean energy in the emerging and developing world is the fault line of reaching international climate goals,” IEA Executive Director Fatih Birol said.
The report released on the eve of the two-day Summit for a New Global Financing Pact in Paris, seeks to galvanise support for revamping the mid-20th century architecture governing financial flows from rich to developing nations.
G20 nations are historically responsible for 80 percent of global carbon emissions, which are wreaking havoc on the earth’s climate.
According to Amnesty International’s secretary general, Agnès Callamard, “Many vulnerable, lower-income states have been overwhelmed by economic shocks, debts they cannot pay, and the effects of climate change – a crisis to which they contributed very little, but which is costing people in these countries dearly,”
“These are unprecedented challenges that require a rethink of how the world’s financial architecture is set up,”
Speeding the transition from dirty to clean energy and helping emerging and developing economies cope with and prepare for devastating climate impacts are high on the summit agenda.
Nearly 800 million people lack electricity and 2.4 billion have no access to clean cooking fuels, most of whom reside in poor and emerging countries.
Under current policy trends, one-third of the rise in energy use in these nations over the next decade will be met by burning fossil fuels, the main driver of global warming, the IEA warned.
According to Birol, investments in clean energy are increasing, but “the bad news is that more than 90 percent of that increase in clean energy since the Paris Agreement in 2015 comes from advanced economies and China.”
To unlock the potential for clean energy in emerging and developing economies, the report emphasized the need for greater international technical, regulatory and financial support.
Based on the IEA’s report, two-thirds of the financing for clean energy projects in emerging and developing economies excluding China “will need to come from the private sector” because public sector investments are “insufficient to deliver universal access to energy and tackle climate change”.
According to the IEA report, there is potential for rapidly ramping up renewable energy. Solar power is now the cheapest source of electricity generation across almost the entire world.
At least 40 percent of the global solar radiation reaching the planet lands on sub-Saharan Africa, and yet nearly 10 times more solar capacity was installed in China last year than across the entire African continent.
