International Energy Agency<\/a>, global spending on clean-energy networks must increase from approximately $270 billion in 2023 to $870 billion per year by the early 2030s to meet climate and energy goals. Consider this: 570 million people in Africa and 750 million people worldwide still lack access to electricity.<\/p>\nFrancesco La Camera, Director-General of IRENA, argues that incremental project finance won\u2019t narrow this gulf. Instead, he calls for a paradigm shift: long-term infrastructure deals backed by multilateral institutions, aimed at building resilient energy systems from the ground up.<\/p>\n
\u201cThis is not charity,\u201d La Camera told me. \u201cIt\u2019s development. We must rethink how cooperation between the North and South works\u2014and connect that development to infrastructure that supports new energy.\u201d<\/p>\n
The Climate Clock Is Ticking<\/p>\n
TOPSHOT – Artisanal miners collect gravel from the Lukushi river searching for cassiterite on … More February 17, 2022 in Manono. – The Democratic Republic of Congo is rich with Lithium, an essential mineral for electric car batteries, which nests in the remains of the former mining town of the city of Manono in the south-east of the country in the province of Tanganyika. To get out of poverty, the inhabitants of Manono, most of whom are artisanal diggers, place their hope in the investment of the Australian company AVZ minerals which plans to invest 600 million dollars in the construction of a lithium mining (Photo by Junior KANNAH \/ AFP) (Photo by JUNIOR KANNAH\/AFP via Getty Images)<\/p>\n
AFP via Getty Images<\/p>\n
Scientists warn that the window for action is closing. NASA confirmed in 2024 that the world has already crossed the 1.5 degrees Celsius threshold\u2014the level at which irreversible climate damage becomes increasingly likely. According to IRENA, the world must triple renewable energy capacity by 2030. To stay on course, global CO2 levels must fall 43% by 2030 and 60% by 2035.<\/p>\n
But this transition can\u2019t happen without climate finance. In Africa, multilateral financial institutions have coordinated project pipelines totaling $2 billion in just one year, helping countries like Sierra Leone build capacity and attract long-term investment. Still, Africa receives only about 2% of global renewable energy investment\u2014a glaring disparity between the need and the support.<\/p>\n
In truth, energy infrastructure is the 21st century\u2019s Marshall Plan\u2014a systems-level investment that could transform economies, reduce emissions, and bring electricity to hundreds of millions.<\/p>\n
Africa has enormous potential for clean energy. On average, renewables\u2014mostly hydropower\u2014account for about 22% of the continent’s electricity generation. Nigeria, for example, aims to achieve 50% renewable electricity through localized microgrids, with support from the World Bank and the African Development Bank.<\/p>\n
Meanwhile, the global energy shift has reached a critical juncture. In 2023, 92% of new electricity capacity added worldwide came from renewable sources\u2014a trend that appears likely to continue. This occurs despite geopolitical instability, the Trump administration\u2019s support of fossil fuels, and its withdrawal from the Paris Agreement.<\/p>\n
\u201cWe\u2019ve passed the tipping point,\u201d La Camera says. \u201cThe market has made its choice. But unless multilateral lenders rewrite the rules of development, much of the Global South will be left in the dark.\u201d<\/p>\n
It\u2019s not enough to install solar panels or wind farms. Electricity needs a flexible and interconnected grid to manage variable supply and growing demand. Many low-income countries lack that backbone.<\/p>\n
Time to Rethink Development Finance<\/p>\n
BAKU, AZERBAIJAN – OCTOBER 11: Francesco La Camera, Director-General of the International Renewable … More Energy Agency (IRENA) speeches on Tracking UAE Consensus Energy Outcomes – Report Launch in Heydar Aliyev Center on October 11, 2024 in Baku, Azerbaijan. (Photo by Aziz Karimov\/Getty Images)<\/p>\n
Getty Images<\/p>\n
This \u201cinfrastructure gap\u201d also inflates borrowing costs, creating a vicious cycle: the perceived risk keeps investors away, which further erodes infrastructure and deters more capital. Poor countries spend most of their money repaying debt\u2014not building distribution networks.<\/p>\n
In many African nations, the cost of capital for infrastructure projects can range from 12% to 20%, compared to 4% to 6% in developed markets, according to estimates from the African Development Bank and the International Energy Agency. That difference alone can double project costs.<\/p>\n
\u201cWithout reliable infrastructure, investors won\u2019t risk their capital,\u201d La Camera says. \u201cYou can\u2019t put electrons into a grid that doesn\u2019t exist. And if people can\u2019t afford to pay for electricity, the projects aren\u2019t bankable.\u201d<\/p>\n
The director-general doesn\u2019t mince words: the current project-by-project aid model isn\u2019t effective. What\u2019s needed now is a structural response.<\/p>\n
Multilateral financial institutions\u2014like the World Bank, African Development Bank, and Asian Development Bank\u2014must shift their focus to long-term infrastructure investment, concessional loans, and risk guarantees. These tools can unlock funding and make otherwise unbankable renewable projects feasible.<\/p>\n
In 2022, multilateral development banks provided approximately $65 billion in climate finance, with a significant portion directed at energy infrastructure and policy support in low- and middle-income countries, according to the MDB Joint Report on Climate Finance. But that still falls far short. The African Development Bank estimates the continent needs $130 billion per year in energy investment to meet demand and achieve much broader electricity access by 2030.<\/p>\n
This isn\u2019t just good policy\u2014it\u2019s good economics. Infrastructure investment drives growth, creates jobs, and lays the foundation for long-term development.<\/p>\n
Take Uzbekistan: IRENA, working with the European Investment Bank, helped facilitate funding for 900 megawatts of utility-scale solar energy, including a 400 MW project that will power approximately one million households and reduce the country\u2019s reliance on natural gas.<\/p>\n
\u201cThese are not isolated cases,\u201d La Camera said. \u201cThey show how infrastructure-led development and multilateral support can unlock the transition.\u201d<\/p>\n
Why Not Leave To The Private Sector?<\/p>\n
Some critics argue that development should be left to private markets, warning that favorable financing can distort competition or create dependency. Others question whether fledgling governments can effectively manage infrastructure investments.<\/p>\n
While those concerns are real, they miss the point. Without infrastructure, markets can\u2019t function. Investors won\u2019t commit to regions where offtake is uncertain and power grids are unreliable. Multilateral banks don\u2019t replace the private sector\u2014they enable it.<\/p>\n
La Camera is cautiously optimistic that we can solve the crisis dilemma while bringing clean energy to millions globally. \u201cIt\u2019s becoming harder to meet the Paris goals\u2014but we must not stop. The transition is unstoppable\u2014always up, up, and up.\u201d<\/p>\n
Still, hope alone won\u2019t power homes or stabilize grids. Indeed, the international community must commit to serious financing and infrastructure development that makes it possible. Half-hearted efforts prolong the imbalance.<\/p>\n
Building and financing resilient, interconnected energy systems is the defining challenge of our time\u2014and the key to bridging the global energy divide. It means rethinking development, rewriting the rules, and ensuring that everyone, everywhere, has access to clean electricity\u2014not just to raise living standards, but to confront climate change on a large scale.<\/p>\n","protected":false},"excerpt":{"rendered":"Workers for USP&E Global service a power station for an iron ore-mine owned by London mining in ……\n","protected":false},"author":2,"featured_media":10861,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[84,467,56,54,55],"class_list":{"0":"post-10860","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-markets","10":"tag-uk","11":"tag-united-kingdom","12":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/10860","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=10860"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/10860\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/10861"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=10860"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=10860"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=10860"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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