Policy Brief: “Leveraging climate finance for the Global South. Context and tools – a brief overview”

Climate Finance Policy Brief

Abstract

Climate finance in the Global South differs in various ways from the conditions in the industrialised world. These differences result in several obstacles which could be identified as one reason why the annual global renewable energy investments stagnated at a level around $300 billion since 2011, while an estimated number in an area of $2.4trillion is necessary to meet the 1.5°C limit of the Paris Agreement.

The bulk of these $300bn Renewable Energy (RE)-investments happened in high-income countries and China while only a very small part was invested into renewables in the Global South. Only 0.1% of total clean energy investments accumulated in the 31 poorest countries between 2009 and 2018. The main barrier to more RE-investments in the Global South is not a lack of (green) investment capital, but rather a lack of bankable projects.

This policy brief provides an overall assessment of climate finance mechanisms in the context of domestic and international finance in the Global South. Furthermore, it will give a prospect on a possible new finance mechanism if at least a few relevant central banks from the industrialised world will engage in the global climate finance issue. Such an engagement could be the basis to facilitate the needed RE-investments to stop climate change at 1.5°C.

Ambition For the Future – 100%RE to Accelerate Sustainable Development

Abstract

While the Agenda 2030 set the aim to keep global climate change to 1.5°C, existing policy measures, legal frameworks and initiatives are nowhere near these ambitions. However, research indicates that this target is achievable if we fully decarbonize our economy and society by no later than 2050. This ultimately means a transition to 100% renewable energy (RE) and a complete phase out of fossil fuels.

Therefore, this report highlights how 100% RE is a prerequisite for achieving justice and dignity for present and future generations, including a mechanism to finance this transition. The links between these elements – namely regenerative cities, sustainable agriculture, peace and disarmament and education for sustainable development – and 100% RE underpin the reasoning and strong necessity to transition to 100% RE. The clarification of these interrelationships enables a comprehensive approach to climate action and policy design that disrupts single silo thinking while leaving no one behind.

Financing 100% Renewable Energy for all in Tanzania

Abstract

Tanzania is endowed with abundant, high quality renewable resources which could play a significant role in meeting the country’s energy demand and propel living standards to the level of industrialized countries by 2050. This means however, that an average annual investment of US$9 billion is needed, to reach the 100% RE. In order to provide 100% Renewable Energy which is affordable for all, additional financial means are necessary.  A new model focusing on an agreement between MDBs and Central Banks from the industrialized world outlines how to unlock this necessary investment to implement 100%RE for all by 2050.