IEA working to cut renewable energy costs in developing world

The International Energy Agency (IEA) is actively working to reduce the cost of renewable energy in developing countries. This effort underscores our commitment to making sustainable energy more accessible and affordable, with the goal of accelerating the global transition to renewable sources and minimizing the impact of climate change.

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The International Energy Agency (IEA) is working to reduce the cost of renewable energy in developing countries, according to Fatih Birol, the agency's executive director.

He said the agency will ensure that the World Bank, regional development banks and other institutions prioritize clean energy investments in developing countries after the final Conference of the United Nations on Climate Change (COP28).

At COP28 in Dubai, the world's governments agreed to triple renewable energy generation capacity by 2030 and abandon the use of fossil fuels.

However, there is no agreed mechanism to finance the transition to clean energy in developing countries.

Speaking on the sidelines of an energy conference in Istanbul on Friday, Birol mentioned that investment in clean energy in emerging and developing countries has remained stagnant since 2015 while increasing almost universally.

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Most of the growth comes from China and advanced economies.

He told Reuters: "For the International Energy Agency, the most important thing between now and Baku will be to find risk mitigation mechanisms to ensure capital flows to developing countries and emerging countries. COP29 is expected to take place in Baku next year.

Birol added that risks mean the capital cost of investing in solar power plants in developing countries can four times higher than in advanced economies, hindering capital flows.

“Our mission will be to ensure that the World Bank, regional development banks and the financial sector prioritize financing clean energy, minimizing the risks associated with these investments and providing easy financing,” he declared.

He added: “The world now has more capital than it needs .

If the World Bank, regional development banks and financial institutions provide guarantees and risk mitigation mechanisms, money will flow quickly because the potential is huge.