3 financing trends to watch for clean energy revolution in the Global South

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🗞️ Driving the news: Innovative financing models are revolutionizing clean energy development in the Global South, addressing a $1.7 trillion investment gap
• Decentralized energy systems, impact investing, and climate-linked financing tools are making renewable energy more accessible
• These strategies focus on affordability, scalability, and climate impact to drive energy transition in underserved regions

🔭 The context: Despite housing two-thirds of the global population, the Global South accounts for just 18% of global power capacity, with 650 million people still lacking access to electricity
• Traditional financing flows—only 15% directed toward clean energy in these regions—are insufficient to meet the annual $120 billion renewable energy investment need
• Innovative models like pay-as-you-go systems and solar rooftop leasing are providing practical solutions to expand energy access

🌍 Why it matters for the planet: Scaling clean energy in the Global South is vital for achieving global net-zero targets and reducing energy poverty
• These mechanisms align financial returns with environmental and social goals, addressing both immediate energy needs and long-term sustainability
• By enabling renewable energy adoption, these approaches can significantly lower greenhouse gas emissions

⏭️ What's next: Governments and private sectors must embrace diverse financing models, from carbon credits to climate-linked debt swaps, to close the clean energy funding gap
• Collaborative platforms like the World Economic Forum’s playbook can guide stakeholders in implementing solutions at scale
• Increased investment will spur economic growth, improve resilience, and advance global climate targets

💬 One quote: “Pay-as-you-go solar systems have delivered affordable energy to millions of off-grid households,” exemplifies the transformative potential of innovative financing, as shown by companies like M-KOPA

📈 One stat: Achieving sustainable energy access in the Global South requires $1.7 trillion annually, yet only 15% of clean energy investments reach these regions

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