The first meeting of the Efficient World Financing Forum took place on 25 March in Paris with participation from ten key international financial institutions. The Forum, which was first announced in 2018, brings together global leaders of development banks from all world regions to share diverse experiences in the implementation, delivery models and financing mechanisms for energy efficiency, with the ultimate goal of helping to inform plans and approaches to encourage investment in energy efficiency at scale and deliver on its multiple benefits.
As laid out in the IEA’s Efficient World Strategy, launched ahead of the Global Conference on Energy Efficiency last October, to achieve all cost-effective energy efficiency potential, average annual energy efficiency investment must double to 2025 and then double again to 2040. Efficiency gains under this scenario would also enhance energy security, reduce household expenditure by over $550 billion, and cut air pollutants by around one-third compared with today.
“Investment opportunities in energy efficiency are highly cost-effective today and would bring significant economic benefits,” said Dr Fatih Birol, the IEA’s Executive Director, in his opening remarks. “However, a combination of policy and financial know-how is needed to facilitate new business and financing models on the ground to realise this investment opportunity.”
Among the themes discussed were key market and policy trends in energy efficiency and the investment gaps ahead. Development banks around the table shared their own experiences in developing programmes for financing energy efficiency, emphasizing success factors and barriers impacting current opportunities.
Participants highlighted key factors for investment, including the policy and regulatory environment, the development of a supportive energy efficiency industry and financial ecosystem and addressing persistent barriers for financing. The meeting concluded by suggesting that the Forum explore further the links between investments and policies, as well as ways to support greater institutional commitment to energy efficiency finance and the sharing of best practice. For example, the IEA’s 4th annual Global Conference on Energy Efficiency, which will take place in Dublin on June 24th and 25th, presents an opportunity to further develop this engagement on energy efficiency finance issues.
Meeting participants or contributors included the Asian Development Bank, African Development Bank, Development Bank of Latin America, European Bank for Reconstruction and Development, European Investment Bank, Green Climate Fund, Inter-American Development Bank,Islamic Development Bank, KfW, World Bank.