Ministers at Cop28 met in the UAE and agreed on a global target to triple renewable capacity by 2030 to over 11,000 gigawatts.

This offers hope in our battle against climate chaos and is aligned with limiting temperature to 1.5C.

But to realise this aspiration necessitates a significant increase in financial support and financial reform.

The good news is that upscaling renewable energy will to some extent displace fossil fuels by outperforming oil, coal and gas economically.

Yet, to phase out fossil fuels at the speed and scale needed to keep global warming to 1.5C, we need a managed decline and a decision and implementation plan to deliver the phase-out.

These decisions, and in particular the fast-tracked scale-up of renewable energy must be anchored with concrete processes and resources to implement it. Above all, this means finance for the Global South.

Along with a global target to triple renewable energy, G20 leaders acknowledged this needs a yearly investment of $4 trillion by 2030 in their communique – not a mundane reckoning.

Yet, the G20 went on to say that these goals would be met “within existing policies”, an absurd claim.

Flatlining finance

Surely, the G20 leaders are briefed well enough to know the opposite is true – rather some G20 leaders wanted to deflect pressure on updating their national targets by 2030. To not end up with a hollow renewable target and energy package at Cop, we need finance.

Across the Global South outside of China, we are confronted with a stark reality: Investment in renewable energy has remained more or less flat since the Paris Agreement.

If we are to reach a $4tn investment in renewables, numbers need to more than double from the current $1.7 trillion allocated to clean energy.

Out of these $1.7tn, only about 15% are invested in the Global South outside China – despite that being where roughly 7 out of 10 humans live today.

The International Energy Agency estimates that by 2030 we will need around $1.9 trillion yearly investment in the Global South outside China.

It estimates that three-fifths ($1,14tn) of this will need to come from private and two-fifths ($760bn) from public sources. But what is hindering renewables really taking off in so many countries?

It’s not low renewable energy potential. For example, Africa is home to three-fifths of the top solar sites in the world but in the last two decades, just 2% of global investments in renewable energy were made in Africa.

In high-income countries, 81% of green investment is funded by the private sector. In emerging and developing countries, the private share is a mere 14%.

Structural injustice

There are structural and historical injustices pertaining to the global financial system, including debt and ongoing extractivism.

One aspect of this is the high cost of capital: The interest rate to finance renewable energy in rich countries has historically been around 3-4% while usually exceeding 10% in emerging and developing economies. This difference matters.

These interest rates can be broken down into micro-risks – those directly related to the project –  and macro-risks – those that account for risks like governments and currency risks.

The interest rates for a project itself (micro-risk) tend to be lower than in rich countries, but then you pay an additional 5-10% simply for investing in a certain country (macro-risk).

Usually, the cost of capital is unfairly biased against the Global South, not providing a “rational” cost of capital. For example, overestimating exchange risks.

Cop28 needed to underpin the tripling of renewables with tangible political commitments and processes to unlock finance: debt cancellation at scale, $100bn in concessional finance, and $200bn in grants yearly.

Grids and transmission lines are usually predominantly financed by public finance and illustrate clearly why public and private investments are heavily interdependent as private investment requires functioning grids.

Energy access

Another critical role of public investment will be providing energy access. Over 760 million people are suffering from a lack of access to electricity, the majority, 600 million on the African continent.

More than half (55%) of those households which are yet to gain access to electricity will require mini-grid and off-grid solutions. Clearly, decentralized renewable energy is the best-fit.

This will need heavy public investment if we don’t want to leave these people at the mercy of revenue calculations.

Grids and access are just two examples of necessary investments at scale, which will need the support of grants – even with significant debt cancellation. To reach $760bn public investment will need an additional $500bn in public investment in renewables yearly in the Global South outside China.

If these $500bn are seen as highly concessional (reflected by a 40% grants ratio), one calculates this will need another $200bn+ in yearly grants.

Some of this is within the realm of Cop, and some of this the United Nations Climate Convention can only call on to be set in motion.

One may say, this is politically impossible or there is no money. But such claims are both cynical and not grounded in facts.

The G20 countries alone provided $1.4 trillion in direct subsidies to fossil fuel companies, and global fossil fuel consumption subsidies last year.

The wealthiest 3m000 people work at the “edge of legality” preserving their obscene wealth, taxing it at only 2% – significantly below what such wealth is expected to provide in yearly returns – would provide $250bn each year.

There is no hope without vision. In fact, taking a step back one realizes the proposals above are less visionary than pragmatic. Global access to justice and fairness is very much possible.

This article is also published on Climate Home News. illuminem Voices is a democratic space presenting the thoughts and opinions of leading Sustainability & Energy writers, their opinions do not necessarily represent those of illuminem.