The International Energy Agency’s recent finding that investment in clean energy in 2024 will be double that in hydrocarbon projects comes with both good and bad news.
The good news is that investment in clean energy is expected to exceed US$2 trillion for the first time ever, but unfortunately, most of this investment is taking place in the Global North. Only 15% of this record investment is thought to go to the Global South, which includes developing countries in Africa, Latin America, South Asia and Southeast Asia. This is far less than what these countries need to meet their energy needs and transition to clean, affordable energy.
With the Global South accounting for 56% of the world’s population but only 18% of its energy generation capacity, the question remains: How can emerging and developing economies secure the clean energy financing needed to not only keep pace with the global energy transition but also? Protect their energy security? Achieving this balance is critical to ensuring these countries’ economic resilience and building a more equitable global energy landscape.
It’s a question those in the energy sector know well, as it has been a major focus of ongoing discussions between the energy industry, governments, intergovernmental organizations and policy makers. As CEO of a global alliance dedicated to cooperation, I believe there are key actions that can lead to more equitable and affordable access to clean energy around the world, although specific solutions may vary from country to country. These broad measures are not only necessary, but necessary to achieve tangible progress on a global scale.
First, we must connect those involved in clean energy security in the global North and South. Knowledge sharing and collaboration across geographies, sectors and disciplines can have a multiplier and transformative impact on clean energy financing efforts. Public-private partnerships, in particular, can pool resources, share expertise, and advance sustainable energy projects, while knowledge-sharing at the expert level can improve outcomes by avoiding risks and identifying easy gains.
By sharing knowledge, those working to advance clean energy financing in the Global South can learn about the best technologies and systems to achieve desired goals. At the same time, those working on the ground in the Global South have invaluable experience that they can share with technology developers and solution providers to identify challenges and highlight specific local needs, which can lead to the development and identification of locally relevant solutions. Many countries of the Global South face unique challenges in infrastructure, climate, landscape, and resource availability, which must be taken into account when planning and financing any clean energy to ensure maximum sustainability.
In the field of technology, some emerging technologies are expected to have a significant impact on clean energy security, such as artificial intelligence and digital transformation. AI can help predict loads and balance multi-energy microgrids that can include different sources of clean and traditional forms of energy. According to Argonne National Laboratory, incorporating AI into the design of clean energy projects could reduce project timelines by 20%, which could translate into massive savings. AI can also enable efficient grid optimization and waste avoidance, as well as dynamically manage energy storage and grid response. Digitization technologies such as the Internet of Things (IoT) can allow utilities to manage demand during peak times, while data analytics can help make better operational decisions.
Of course, the most important aspect of clean energy security in the Global South is ensuring access to appropriate financing and investment in clean energy. While greater commitments to financing clean energy projects in the Global South have helped address traditional investment shortfalls, especially after COP28, challenges remain in access to capital. For example, one of the key issues for securing financing and investment for clean energy projects in the Global South is awareness of the risks and inflated costs involved. Partnering with existing clean energy companies and solution providers and leveraging technologies that can improve efficiency and reduce cost can help improve the results of technical and economic feasibility assessments.
Having worked in various roles in the energy industry, I have witnessed first-hand how collaboration, technology, and equitable access to finance are not only beneficial, but essential in driving clean energy financing on a global scale. The potential for energy-based economic growth is enormous, but this potential can only be unleashed through these strategic changes, like those we are already seeing in the Global Impact Alliance.
Take SUEZ, the global leader in circular solutions for water and waste, which joined us in the Global Impact Alliance in September 2024. This move strengthens SUEZ’s ability to collaborate across the chemicals and energy sectors, while also strengthening the alliance’s mission. To achieve net zero emissions. With the support of key players such as Mitsubishi Chemical Group, SABIC, BASF and Covestro, the alliance has made great strides, including developing new technologies for processing plastic waste that not only reduce carbon footprints, but also make the process more affordable by enhancing the efficiency of polymer recycling. . . These partnerships and technological developments are not just symbolic gestures – they are the driving force behind the chemical industry’s efforts to lead the energy transition and leverage its potential for sustainable growth.
The lesson here is unequivocally clear: cooperation, whether through knowledge sharing, technology, or direct investment, is the key to a successful energy transition. But this need for collaboration is particularly acute in the Global South, where clean energy security and investment depend on such partnerships. Without it, the promise of a just, affordable and sustainable energy future will remain elusive for many.
To strengthen such partnerships, we must support international events like ADIPEC, the world’s leading energy event currently taking place in Abu Dhabi, where real connections are forged, and transformative agreements are created and expanded. With attendees from 160 countries and more than 2,220 organizations, the event fosters a collaborative environment, prioritizing diversity, equality and inclusion to ensure that voices from around the world can unite around the common mission of delivering the energy system of the future.
The Global Impact Alliance is proud to participate in industry-leading events such as ADIPEC, where our ambitions for a low carbon future are fully aligned. Our goal of reducing greenhouse gas emissions from the entire chemical industry is not just a goal, it is a necessity. To achieve this, we are leveraging existing and future collaborations to enable a greater push towards energy technology and energy access. In doing so, we aim to ensure that the energy transition is not just about decarbonisation, but also about providing energy security, affordability and sustainability on a global scale.
By harnessing and reducing cost-saving technologies, sharing knowledge and expertise, and securing mutually beneficial partnerships, the collective international community can work together to ensure that the energy transition is truly affordable, equitable and sustainable.
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