The International Energy Agency (IEA) has received a major funding boost in the form of a €20 million funding stream from member countries, enabling the scale-up of work supporting the clean energy transition.
The new funding stream will support efforts to achieve greater clean energy investment in emerging economies, as well as to boost work on policy advice, training and net zero roadmap development.
Clean Energy Transitions Programme
The funding increase is being allocated to the IEA’s Clean Energy Transitions Programme (CETP).
The CETP was announced at a special event on the side-lines of the 2022 IEA Ministerial Meeting in Paris. The meeting saw ministers from IEA member countries and beyond discuss how to accelerate clean energy transitions and strengthen energy security in the face of Russia’s aggression in Ukraine.
A key focus of the CETP is helping emerging economies strengthen their policy and regulatory frameworks to attract required clean energy investment. The programme also works on addressing issues related to innovation and the environment.
The new CETP funding stream will come from voluntary contributions by 15 IEA member countries and the European Union. It will expand the IEA’s development of more tailored and actionable national net zero roadmaps for emerging economies. Additionally, it will enhance efforts to track progress on reducing energy sector emissions.
Supporting transitions to net zero
The stream itself is also seen as an endorsement by governments of the IEA’s role in helping the global energy system transition to net zero emissions.
“To solve the climate crisis, we must take bold and transnational actions to ensure a green and sustainable future,” said Danish Minister for Climate and Energy Dan Jørgensen, who chaired the event on the CETP.
“The CETP is the main vehicle for the IEA to drive real global change and clean energy transition towards net zero.”
Since its creation in 2017, the CETP has established cooperation on clean energy with the largest emerging economies, including Brazil, China, India, Indonesia and South Africa.
The CETP provides a range of policy advice, training and capacity building to help these economies move towards sustainable low-carbon solutions. It simultaneously hopes to support them in ensuring energy security and economic opportunities.
Clean energy investment
“The world needs a massive surge in clean energy investment, especially in emerging economies, to put emissions on a rapid downward trajectory,” said IEA Executive Director, Fatih Birol.
“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.”
According to IEA analysis, annual capital spending on clean energy in emerging and developing economies requires significant expansion. To get the world on track towards net zero emissions by 2050, such spending would need to go from less than $150 billion in 2020 to over $1 trillion by 2030.
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 are contributing to the programme for the first time as part of the new Joint Commitment on funding.
The CETP’s Joint Commitment statement can be accessed online
The stepped-up funding follows the COP26 Climate Change Conference in Glasgow, where countries renewed their commitment to mobilise $100 billion of climate finance a year for developing and emerging economies.