IRENA and OPEC to mobilise sustainable finance in developing economies
The International Renewable Energy Agency (IRENA) and the OPEC Fund for International Development have signed an MoU in an agreement to mobilise finance, unlock investment and support on the ground project development towards the energy transition.
The announcement of the partnership comes in to bolster access to sustainable finance in emerging and developing economies.
The Memorandum of Understanding (MoU) was signed by IRENA’s director-general Francesco La Camera and the director-general of the OPEC Fund, Dr Abdulhamid Alkhalifa, formalising the cooperation.
The collaboration will see IRENA and OPEC join hands to provide technical assistance and capacity building to project developers, creating a pipeline of bankable projects ready to be financed.
They will also work to attract potential investors and explore cooperation under the IRENA-managed Energy Transition Accelerator Financing (ETAF) Platform, the Climate Investment Platform (CIP), and OPEC Fund initiatives such as the planned Energy Access and Transition Trust Fund.
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La Camera stated on the partnership: “The global energy transition must dramatically accelerate. To achieve net zero and universal energy access, our World Energy Transitions Outlook shows that we must nearly treble the speed of deployment of renewables and massively redirect investment towards transition.
“Our cooperation with the OPEC Fund will help unlock much needed capital in developing countries to bring economic growth, sustainable prosperity and jobs to people through renewables projects on the ground.”
Alkhalifa added to this, stating the necessity of an inclusive and just transition: “Our cooperation with IRENA will help to provide the necessary funds and facilitate access to innovative financing solutions, knowledge and technologies, as well as technical assistance for project development and capacity building to support the energy transition in our partner countries, particularly in Africa.”
Both sides agreed to the future collaboration in the hopes of achieving a just, inclusive and equitable energy transition aligned with the 2030 Agenda for Sustainable Development and the Paris Agreement.
Coming in months after the release of IRENA’s World Energy Outlook 2022, recognition of the bringing the energy transition to developing countries and economies is becoming more of a priority.
Released in March, 2022, IRENA’s report illustrated how speed is the key, not only for the transition itself, but also for energy security, price stability and resilience. Including developing countries in the mix is thus essential and such a partnership will hopefully ensure the transition is, in fact, for everyone.
Furthermore, the two global players have also announced their intentions to closely collaborate at the United Nations Climate Conferences COP27 in Egypt in November 2022 and COP28 in the United Arab Emirates in November 2023.
Neither IRENA or OPEC have stated which countries are targeted regarding the support from their collaboration.
