ENABLING CLIMATE AMBITIONS

The Technical Assistance Facility (TAF) helps attract and accelerate clean energy investments and de-risk the sustainable energy sector in developing countries, so they can move towards a green future.

Strengthening policy and capacity

Low- and middle-income countries have contributed the least to climate change, but their collective emissions are projected to rise significantly in the coming years. Developing economies clearly need support if they are to leapfrog traditional carbon-intensive pathways and unlock the potential reductions in emissions – and equally enormous economic opportunities – represented by clean energy.

TAF is a launchpad for these ambitions. It helps to mobilize resources and de-risk the sustainable energy sector by funding early-stage activities for renewable energy and energy-efficient solutions. This in turn incentivizes long-term public and private investment in clean energy in developing regions.

TAF tailors its activities to each country, with support for strengthening national regulatory and policy frameworks, building local institutional and human capacities, and designing innovative financing instruments and business models to optimize the investment environment.

The Challenges

A major barrier to success is that developing economies have limited ability to attract investment for their clean energy ambitions. Large investments are required to help countries move away from fossil fuel dependence onto sustainable pathways. There are various reasons for this, which include poor credit history and low access to reasonably priced credit. However, the perceptions of risk wrapped up in the governance and institutional capacities of developing countries can be the most difficult hurdle for potential investors to overcome.

TAF seeks to navigate these perceptions, to de-risk investment and attract investors by funding the groundwork, and first stage building blocks needed to create a frictionless transfer to clean energy inside a host economy.