The commitments made at the 28th United Nations Climate Change Conference (COP28) known as the UAE Consensus to triple renewable power capacity and double energy efficiency by 2030 are critical enablers to keep the 1.5°C promise. However, the funds to turn those commitments into reality are greatly insufficient at present.

For renewable power capacity to reach 11.2 terawatts in line with the tripling goal, annual investment must be scaled to at least USD 1.4 trillion in 2025–2030–more than doubling the USD 624 billion invested in 2024. Although global transition-related investments exceeded USD 2 trillion for the first time in 2023, current patterns of investment are skewed, leaving many in the Global South behind.

At the COP29, Parties reached an agreement to triple climate finance for developing countries to USD 300 billion annually. These pledges are a welcome progress, yet still fall short of the USD 5 trillion per year required for the energy transition. Furthermore, efforts must be made to ensure developing countries can access the climate finance. This is where project facilitation plays a key role. Effective project facilitation is essential to overcome the hurdles in accessing climate finance to develop and implement projects, consequently unlocking the transformative potential of energy transitions for communities.

Project facilitation – the bridge between funding and projects

Although the availability of climate finance makes it possible for developers to deploy innovative technologies and business models, climate finance providers have strict eligibility criteria that mostly favour well-developed large-scale projects, which are scarce in developing countries. To make sure project developers and host governments in the Global South acquire the needed upfront funding and support, projects’ readiness for financing must be enhanced through project facilitation.

With project facilitation intervention, project developers can get a thorough understanding of the requirements and eligibility criteria for available funding. That understanding can help them improve project documentation and preparedness. Apart from improving projects’ financial viability through advisory services, and direct technical assistance, project facilitation aids in removing policy and regulatory obstacles. The focus on improving the bankability and attractiveness of projects is critical to securing concessional and commercial funding that enables projects to achieve financial close.

The need for synergy

A paradigm shift in project facilitation is urgently needed however, from simply securing more climate finance for projects, to accelerating the scaling up of renewable energy projects. Additionally, a significant increase of climate finance must be mobilised towards more projects in the Global South. Increased public and private funds can facilitate blended finance packages and spread the investment risks, making otherwise costly projects financially viable.

To remove critical barriers and make projects in all scopes and sizes attractive to financiers, climate finance providers and project facilitation entities must work closely in de-risking the projects and enhancing their bankability. Linking projects with climate finance through platforms and investment forums is also beneficial for both project developers and climate finance providers. That way, funding partners can access a curated pipeline of projects, while project developers can get capacity building, coaching, and matched with suitable financiers.

Understanding the need for such synergy, the International Renewable Energy Agency (IRENA) puts an emphasis on both finance mobilisation and project facilitation through initiatives like Climate Investment Platform (CIP) and the Energy Transition Accelerator Financing Platform (ETAF). Not only both Platforms facilitate capital mobilisation, but they also direct the funding towards a diversified pipeline of renewables and other energy transition projects especially in the Global South.

With USD 4.15 billion of soft pledges mobilised by 2024, ETAF’s project facilitation continues to support projects’ readiness through in-depth review of projects and related documentation; capacity-building; technical assistance; and eligibility assessments to meet partner funding criteria. The regional investment forums organised in the framework of the Platform provide space for the financial match-makings, allowing investment-ready projects to be then channelled to the Platform’s funding partners.

When countries leverage both climate finance and project facilitation in synergy, more projects can comply with funders’ requirements, and secure the resources needed to scale, which will advance the pursuit to triple renewable power capacity by 2030.