Energizing Finance: Understanding the Landscape

The 2021 report 'Energizing Finance: Understanding the Landscape' analyzes finance commitments for electricity and clean cooking in 20 high-impact countries (HICs) based on 2019 data. It finds that investment levels for both sectors fall critically short of the requirements to achieve Sustainable Development Goal 7 (SDG7), with electricity finance declining in 2019 and clean cooking investment remaining stagnant.

• Finance commitments for electricity in high-impact countries (HICs) declined by 27 percent in 2019, falling to USD 32 billion from USD 43.6 billion in 2018. Of this total, approximatelyS approximately one-third (USD 12.9 billion) benefited residential consumers, which is significantly lower than the proportional share of the USD 41 billion annual global investment estimated by the IEA to be necessary for universal electricity access by 2030.
• There was a shift toward Paris Agreement-aligned energy solutions in 2019, as finance for grid-connected fossil fuels dropped from 50 percent of total electricity finance in 2018 to 25 percent in 2019. Additionally, finance for transmission and distribution infrastructure reached its highest level since tracking began in 2013.
• Investment in off-grid and mini-grid solutions remains insufficient, representing only 0.9 percent of tracked electricity finance. While these solutions are essential for universal access—requiring an estimated USD 6.6 to 11 billion in additional finance between 2020 and 2030—funding from bilateral and multilateral development finance institutions (DFIs) dropped from USD 260 million in 2018 to USD 34 million in 2019.
• Clean cooking investment is chronically underfunded, with annual tracked commitments in HICs stagnating around USD 130 million between 2015 and 2019, far below the USD 4.5 billion annual investment required for universal access. The portfolio is dominated by a few large projects and providers; for example, 70 percent of finance for Kenya and Bangladesh came from just seven projects.
• Private sector investment in clean cooking reached a peak of USD 56 million in 2019, increasing from USD 32 million in 2018 and USD 21 million in 2017. This investment focused on LPG, ethanol, and biogas, while improved cookstoves (ICS) attracted no tracked private investment in 2019.
• Clean cooking is largely absent from national climate policies; only 43 of 165 countries mention cooking and cookstoves in their Nationally Determined Contributions (NDCs) submitted to the UNFCCC, and only 12 of the high-impact countries include them.
• A case study of Mozambique highlights the vulnerability of centralized electricity systems to climate change, noting that the Cahora Bassa dam provides over 50 percent of the country's electricity via a single transmission line. Recent finance has heavily favored grid-connected fossil fuel projects (USD 1 billion in 2018 and USD 877 million in 2019) rather than diversified renewable energy.

APA

Richmond, M., Meattle, C., Pinko, N., Stout, S., Azhar, H., Mazza, F., & Dickson, M. (2021). Energizing Finance: Understanding the Landscape. Climate Policy Initiative. https://www.climatepolicyinitiative.org/wp-content/uploads/2021/10/UTL-Executive-Summary-FINAL.pdf

Chicago

Richmond, Morgan, Chavi Meattle, Nicole Pinko, Sean Stout, Haysam Azhar, Federico Mazza, and Melina Dickson. Energizing Finance: Understanding the Landscape. Climate Policy Initiative, 2021. https://www.climatepolicyinitiative.org/wp-content/uploads/2021/10/UTL-Executive-Summary-FINAL.pdf.

Wikipedia

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BibTeX

@techreport{richmond2021energizing, author = {Richmond, Morgan and Meattle, Chavi and Pinko, Nicole and Stout, Sean and Azhar, Haysam and Mazza, Federico and Dickson, Melina}, title = {{Energizing Finance: Understanding the Landscape}}, institution = {Climate Policy Initiative}, year = {2021}, url = {https://www.climatepolicyinitiative.org/wp-content/uploads/2021/10/UTL-Executive-Summary-FINAL.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }