This session will explore the potential of new and innovative financing mechanisms for achieving sustainable energy development. According to an analysis by SE4All, the current pace of additional investments in sustainable energy are insufficient to meet SE4All’s stated targets for energy access, energy efficiency and renewable energy. Consequently, the rate of investment falls short of the required efforts necessary to achieve the energy system transformation needed to stabilize GHG emissions in line with the 2 degree Celsius ceiling agreed-upon by the international community. Currently, public sector investments and incentives for the private sector, combined with improving technology costs, are gaining momentum, but it is clear that these will not be sufficient. In particular, perceived risks, some specific to sustainable energy and others related to emerging markets or financial mechanisms, are acting as constraints to the long-term investment growth trajectory.
To overcome these barriers, new and innovative financing mechanisms and instruments for sustainable energy are needed that are tailored to the various types of investors. Therefore, this session will explore ways in which the market can tap into the broad and diverse pool of public and private sector investors from both OECD and emerging markets.
Specifically, panellists will discuss the necessity of developing a robust project pipeline and share insights into some of the innovative instruments emerging to meet these challenges, such as green bonds, innovative de-risking structures, as well as bundling and pooling approaches to meet the demand of smaller sized projects.