Cleantech and the transition to net-zero: What is the next big challenge in commercialization of innovative cleantech solutions?
The world’s ability to keep global warming within 1.5 degrees rests on the ability of our economies to reach net-zero by mid-century. The urgent balance between the necessity to achieve economic growth targets and the commitment to net zero climate targets is the core concern of inclusive and sustainable industrial development. Industry plays a pivotal role in accelerating climate action, given the scale of the impact of industrial activities to the environment. Energy systems are at the core of this effort, and they are highly interconnected with mobility, buildings, industry, and land use sectors.
A sustainable economic growth can be achieved by commercialization and large-scale adoption of innovative cleantech solutions. These cleantech solutions offer alternative options for current industrial systems to lower their environmental footprint without losing productivity or competitiveness. And at the same time, a robust market for cleantech solutions can contribute to a rise of start-ups, contributing to a stronger SME sector and creating jobs in developing countries.
The ambition for net-zero emission path must be also accompanied by ambition for inclusivity and social impact, seeking to overcome inequalities embedded in current social infrastructures and value chains. A truly sustainable trajectory will ensure equal leadership and participation of men and women all levels of the transition. Improving the discrepancy of opportunities in rural areas in contrast to urban centers, as well as youth empowerment are also key to an inclusive transition.
UNIDO has been actively promoting innovative business solutions for climate and sustainable energy, through the Global Cleantech Innovation Programme (GCIP). GCIP supports the transformation of promising early-stage cleantech innovations into commercial enterprises (thus creating a pipeline of bankable start-ups), as well as the strengthening of national clean technology, innovation and entrepreneurship ecosystems. In addition, the Private Financing Advisory Network (PFAN) supports more mature projects. PFAN bridges the gap between project developers and investors by supporting entrepreneurs to develop bankable projects, mitigating investor risk, and mainstreaming investments in low carbon, climate resilient projects for sustainable development.
While many existing initiatives including GCIP and PFAN are producing results, there are still barriers that prevent innovative cleantech solutions from reaching the market, and their market-based uptake by industries.
Cleantech enterprises often identify difficulty in securing finance as the key hurdle in reaching the market, including the low awareness and reluctance of private financial institutions and investors to channel their finance towards cleantech enterprises and project developers with climate action and clean energy transition benefits.
Therefore, increasing visibility of cleantech solutions, and highlighting their business case is the next step in supporting cleantech solutions towards commercialization. This side event will center around how climate and impact considerations can be mainstreamed into investment and financing decisionmaking criteria, unlocking private investments towards cleantech solutions at the scale and speed required to achieve a net-zero growth path in developing countries