Mobilising investors to finance clean energy transitions: how can private capital boost a sustainable recovery?

The Clean Energy Ministerial Investment and Finance initiative (CEM-IF) is holding a discussion on financing clean energy transitions and the role of institutional investors.

The Covid-19 pandemic has triggered a historic economic shock with energy investments set to fall by one-fifth this year. At the same time, governments’ rapid responses with stimulus packages and preexisting policy supports for sustainable energy solutions hold vast potential to leverage new investment by institutional investors. IEA’s Sustainable Recovery Report illustrates that additional global investment of about USD 1 trillion annually over the next three years would be required to simultaneously spur economic growth and put emissions on a steady downwards track in line with international climate goals as set out by the Paris Agreement.

Institutional investors globally manage over USD 100 trillion, posing a large potential source of finance for the energy sector and the sustainable recovery plan. However, current market signals are not yet sufficiently incentivizing the major reallocation of capital required to put the world on a sustainable pathway to achieve the Paris Agreement goals.

This event will invite both governments and the investment community to discuss:

1. how the current crisis is shaping capital allocation in clean energy by the investor community for the next decade,
2. what risk, return and scale issues investors see in allocating finance that aligns with long-term climate and sustainability goals and
3. what financial solutions and government policies would help spur an acceleration of clean energy investment in renewables, efficiency and enabling infrastructure.

The organisation of this event was made possible through the Clean Energy Transitions in Emerging Economies programme, which received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 952363.