Sustainable Finance

Member Countries Back IEA to Accelerate Clean Energy Transitions

Published on: 28 March 2022 08:41 AM
by KnowESG

The International Energy Agency receives a new EUR 20 million annual funding stream to support work on policy advice, training and development of roadmaps with the emerging economies. The fund aims at facilitating the transition to clean energy in emerging economies.

The increase in funding for the IEA's Clean Energy Transitions Programme (CETP) was announced at a special event on the sidelines of the 2022 IEA Ministerial Meeting in Paris, which brings together ministers from IEA member countries and beyond to discuss how to accelerate clean energy transitions and strengthen energy security.

The funding will bolster clean energy investments in developing nations and provides a strong endorsement by governments of the IEA's role in facilitating the global energy system transition to net-zero emissions.

Danish Minister for Climate and Energy Dan Jørgensen, who chaired the event on the CETP, said: "To solve the climate crisis, we must take bold and transnational actions to ensure a green and sustainable future. The CETP is the main vehicle for the IEA to drive real global change and clean energy transition towards net zero. To this end, I am thrilled that we are so many supporters and funders to the programme.”

The CETP has supported the world's largest emerging economies such as Brazil, India, China, Indonesia and South Africa in their transition to cleaner energy since its formation in 2017. It provides the developing economies with a range of policy advice, training and capacity building to help them move towards low-carbon economies.

IEA Executive Director Fatih Birol said: "The world needs a massive surge in clean energy investment, especially in emerging economies, to put emissions on a rapid downward trajectory. The issue is not a shortage of capital worldwide but ensuring the money finds its way to the countries, sectors and projects where it is most needed. The Clean Energy Transitions Programme is a vital part of the IEA’s work to help emerging economies strengthen policy-making and ramp up clean energy investment.”

Developing economies have to expand their spending from less than $150 billion in 2020 to over 1 trillion by 2030 on clean energy to get on track for achieving net-zero emissions by 2050, IEA analysis says.

The new CETP funding stream of EUR 20 million per year will come from voluntary contributions from 15 IEA member nations and the European Union, signed a new Joint Commitment pledging their financial assistance through 2030. The additional funds will help the IEA design more targeted and practical national net-zero roadmaps for developing economies, as well as track progress on cutting energy sector emissions.

The CETP is funded by Australia, Belgium, Canada, Denmark, France, Germany, Ireland, Italy, Japan, the Netherlands, Spain, Sweden, Switzerland, the United Kingdom, the United States and the European Commission. Among those, Belgium, Ireland, Spain and the United States contributed for the first time.

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