UAE, IRENA launch $1bn platform to finance renewable energy transition

The UAE and the International Renewable Energy Agency (IRENA) announced on Wednesday the launch of Energy Transition Accelerator Financing (ETAF) Platform, a new global climate finance facility to accelerate the transition to renewable energy in developing countries

It was announced along the sidelines of the COP26, in Glasgow, with the UAE committing $400m in funding provided by the Abu Dhabi Fund for Development (ADFD) toward the platform’s goal of securing a minimum of $1bn in total funding.

Through co-financing, ETAF will aim to mobilise an additional $2bn in energy transition investments, targeting a total deployment of 1.5GW of clean renewable energy generation and storage by 2030.

ETAF will be managed by IRENA from its Abu Dhabi headquarters. The new accelerator platform will help mitigate investment risks and finance renewable energy projects in developing countries that may otherwise struggle to secure sufficient capital.

Today, in the presence of H.H Sheikh Abdullah bin Zayed Al Nahyan, the UAE and @IRENA announced the Energy Transition Accelerator Financing (ETAF) Platform, a global finance facility to accelerate the transition to renewable energy in developing countries #COP26 #UAEforClimate pic.twitter.com/g46uEtfpJt

— Office Of The UAE Special Envoy For Climate Change (@uaeclimateenvoy) November 3, 2021

“This new investment platform reflects the UAE’s commitment to shaping a sustainable future, and IRENA’s efforts to serve its over 180 member countries as an indispensable energy transformation partner. We encourage multilateral development banks, international financial institutions, governments, and private sector actors to join us in bolstering sustainable development efforts,” said Francesco La Camera, the director-general of IRENA.

The new UAE-IRENA partnership to establish the ETAF platform builds on the long-term collaboration between IRENA and ADFD, which includes seven cycles of the $350m IRENA-ADFD Project Facility. Between 2013 and 2020, the facility financed 26 projects in Asia, Africa, and Latin America, notably including Small Island Developing States.

ADFD has contributed to financing to a number renewable energy projects in developing countries, in addition to funding the UAE’s initiatives to support renewable energy projects in island states, including the IRENA/ADFD Project Facility, UAE-Caribbean Renewable Energy Fund (UAE-CREF), and the UAE-Pacific Partnership Fund.

In total to date, ADFD has worked with a number of clean energy partners and governments around the world to support the development of 90 renewable energy projects in 65 countries that have the capacity to generate more than 9,000 megawatts of electricity. With the new ETAF contribution, ADFD’s total financing for renewable energy projects now stands at $1.8bn, according to state-run news agency WAM.

The ETAF platform will source projects on an ongoing basis, supplemented by calls for proposals aligned with Paris Agreement and SDG milestones.

“Today’s announcement will help to advance the economies of partner countries by providing reliable, low-cost renewable energy for businesses, industry, and homes. We are proud of this significant new contribution by the Abu Dhabi Fund for Development to accelerate climate action and deliver immediate economic benefits in the process. This is the kind of initiative that combines partnership, policy and finance to create tangible progress and it is this focus on practical results that has motivated the UAE to offer to host COP 28 in 2023,” added Dr. Sultan bin Ahmed Al Jaber, Minister of Industry and Advanced Technology and UAE Special Envoy for Climate Change.