IEA works on cutting renewable energy costs in developing ‎countries

Fatih Birol, Executive Director of the International Energy Agency, said that the agency will work to ensure that the World Bank, regional development banks and other institutions prioritize the cost of investing in clean energy in developing countries after the end of the latest United Nations climate change conference (COP28). ‎

According to Reuters, the world’s governments agreed at COP28 in Dubai to triple the capacity of renewable energy generation by 2030 and to switch away from the use of fossil fuels, but no mechanism was agreed upon to finance the transition to clean energy in developing countries.

Birol said today, Friday, on the sidelines of an energy conference in Istanbul, that clean energy investments in emerging and developing countries have been stable since 2015, while they have increased almost in the same way globally, and most of the growth came from China and the advanced economies.

Birol said: “For the International Energy Agency, the main story from now until Baku will be how to find mechanisms that limit risks to ensure that there is a flow of capital to developing and emerging countries.” COP29 is scheduled to be held in Baku next year

Birol added that the risks mean that the cost of capital to invest in solar power plants in the developing world may be up to four times higher compared to those in developed economies, preventing the flow of capital.

He said, “Our mission will be to ensure that the World Bank, regional development banks, and the finance sector give priority to financing clean energy, reduce risks for those investments, and provide concessional financing.”

He continued, saying, “The world now has more than enough capital. If the World Bank, regional development banks and financial institutions provide some guarantees and mechanisms to reduce risks, the money will flow very quickly because the potential is huge.”