IRENA launches report on low-cost energy transition finance at G20
In partnership with the Indian G20 Presidency, The International Renewable Energy Agency (IRENA) has launched a comprehensive report on how low-cost finance can accelerate the energy transition. Titled "Low-Cost Energy Transition Finance", the report brings out a toolbox to increase the availability of low-cost capital in G20 countries and beyond.
The report, developed in close collaboration with India's Ministry of New and Renewable Energy (MNRE), was unveiled at a side-event during the G20's 3rd Energy Transition Working Group (ETWG) that happened in Mumbai yesterday.
IRENA Director-General Francesco La Camera commented on the report, "The global energy transition requires a rapid scale-up of renewable energy deployment globally, making access to low-cost finance urgently vital. We are proud to contribute to the work of the G20 and provide valuable insights that support India's Presidency in facilitating access to affordable finance in developing and advanced economies."
The report offers lessons from historical cost reduction trends for solar PV and onshore wind technologies, enabling innovative frameworks that can adopted to accelerate the deployment of new and critical low-carbon technologies, and projected investment requirements for the global energy transition.
Drawing from the lessons learned from the sharp cost reductions seen in solar and wind power in recent years, the report lists enabling frameworks that can reduce the transaction costs of technology transfers and facilitate foreign direct investments to accelerate the adoption and scale-up of critical technologies including hydrogen, offshore wind and battery storage.
These innovation frameworks can drive improvements in enabling technologies, business models, market design, system operation, technological maturity, innovation, system integration, manufacturing capacity increase, and reduced labor costs, according to the report.
IRENA considers access to low-cost capital for project financing in G20 countries as challenging, particularly amid the current global tightening of monetary policies. A substantial portion of the necessary investment in energy transition technologies is yet to be sourced, it opines.
It is to this effect that low-cost financing is identified as one of the six key priority areas established by India's G20 Presidency this time.