The U.S. Department of State, the Bezos Earth Fund, The Rockefeller Foundation, and the World Bank have announced a strategic collaboration between the Energy Transition Accelerator (ETA) and the World Bank to mobilize finance for just and accelerated energy transitions in developing countries. ETA, a partnership between the State Department and the two philanthropies, aims to catalyze private capital for the transition from fossil fuels to clean power through innovative carbon crediting at the jurisdictional scale.
The collaboration between ETA and SCALE (Scaling Climate Action by Lowering Emissions), an initiative by the World Bank, seeks to leverage the strengths of both organizations to mobilize finance for effective energy transitions. Developing countries will be rewarded for verified emissions reductions from a pool of payments committed by public and private sector contributors.
ETA will provide an innovative crediting methodology and a coalition of private sector participants, while SCALE will offer an avenue for sovereign government buyers and support for in-country capacity to deliver high-quality verified emissions reductions. The United States, the first contributor to SCALE, will recruit other contributors in partnership with the World Bank.
Clean energy investment must triple to $4.2 trillion per year by 2030 to stay within the 1.5°C warming limit, with over half of that investment required in emerging and developing economies. ETA will mobilize new finance by assembling a coalition of private sector companies and institutions to commit to paying for verified reductions in power sector emissions resulting from just energy transition programs in developing countries.
The ETA’s jurisdictional crediting methodology, being developed by the nonprofit Winrock International, will incentivize countries to intensify their efforts towards power sector decarbonization and generate new finance for climate adaptation and resilience in vulnerable countries. The World Bank, with its expertise in climate and carbon finance, will scale its work through the SCALE initiative to support impactful climate programs across multiple sectors.
This collaboration between ETA and the World Bank is crucial for accelerating the global clean energy transition, mobilizing the necessary financial resources, and ensuring a sustainable future for all.
Sources: Bezos Earth Fund, The Rockefeller Foundation, World Bank.