FEATURE: 4. Financial Mechanisms and Investment Frameworks for Renewables in Developing Countries
Scaling up renewable energies will undoubtedly be crucial to increasing near-term ambition on mitigation. Many Developing Countries have already set up financial frameworks related to renewable energies. The study provides information in three areas, drawing on this experience:
1. A broad global analysis of RE finance flows, mechanisms, policy frameworks and enabling conditions in the developing world, with illustrative references and examples from specific developing country contexts;
2. Detailed recommendations for the design of national RE finance policy and RE finance programmes;
3. In-depth country case studies for each of a representative sample of Developing Countries – two each from Asia, Africa and Latin America.
According to the study, International climate finance could for example be used to minimise investment risks and maximise, leverage for additional public-private partnership and private finance, along with capacity building targeting project developers, finance institutions and public officials. The paper furthermore concludes that mobilising finance for renewable energy requires a holistic approach, keeping in mind that each renewable energy market is a unique and highly complex system. Policy must be tailored to the local context, combining a supportive and transparent regulatory framework with targeted government interventions.
Date: December 2012
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