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ISA increases funding support for Clean Energy projects

The International Solar Alliance (ISA), a coalition of over 120 countries, has taken a significant step towards promoting solar energy

By Ground Report 02 Nov 2023

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ISA increases funding support for Clean Energy projects

The International Solar Alliance (ISA), a coalition of over 120 countries, has taken a significant step towards promoting solar energy adoption in developing nations. The ISA has announced a considerable increase in Viability Gap Funding (VGF) for solar projects, a strategic move aimed at broadening investment opportunities and advocating for clean, sustainable energy solutions.

ISA boosts clean energy funding

This pivotal decision was unveiled at the sixth assembly meeting of the ISA in New Delhi. RK Singh, Union Minister of New and Renewable Energy of India and President of ISA, declared an increase in VGF from 10% to 35% of the project cost. This increase is intended to better cater to the unique needs and capabilities of individual countries and their specific projects.

The primary goal of VGF is to bridge the financial gap between the total project cost and what developers can recoup through tariffs. By augmenting VGF support, the ISA aims to stimulate more significant investment in clean energy initiatives, particularly in Africa, and attract private sector participation in the solar energy sector.

This move is expected to profoundly impact developing countries by addressing key challenges in the global solar energy landscape. The decision underscores the global community’s recognition of the importance of the solar energy sector in combating climate change and achieving clean energy goals.

ISA, France vital for COP28

As the world gears up for the upcoming UNFCCC COP28, ISA’s initiatives and commitments will play a crucial role in achieving global renewable energy goals and tackling climate challenges. France, a key member of ISA, is actively contributing to clean energy development.

Through the French Development Agency (AFD), they have financed more than 1.5 billion euros of solar projects since 2016 and are committed to further accelerating this.

ISA’s decision to increase the VGF marks a critical milestone in the global transition towards sustainable energy solutions. With more robust funding support for solar projects in developing countries, ISA is set to make a tangible impact on the clean energy landscape, reducing carbon emissions and improving energy access for millions of people worldwide. The move also underscores the urgency of adopting solar energy as a primary energy source to meet growing global energy demands while mitigating climate disruptions.

80% worldwide rely on imported fossil fuels

Raj Kumar Singh, India’s Minister of Power and New and Renewable Energy, stated that approximately 80% of the world’s population, or 6 billion people, live in countries that rely on imported fossil fuels.

He highlights that renewable energy could supply 65% of the world’s electricity by 2030 and decarbonize 90% of the electricity sector by 2050.

He affirmed the International Solar Alliance’s commitment to making solar energy the preferred global energy source and attracting investment to meet global energy demands.

In addition, His Excellency Chrysoula Zacharopoulou, France’s Minister of State for Development, Francophonie, and International Partnerships, highlighted the importance of the ISA for France in promoting clean energy and addressing climate disruption.

He mentioned that France has financed over 1.5 billion euros worth of solar projects since 2016 and is determined to accelerate this effort. Last year alone, France provided more than €7.5 billion in climate finance to support energy transition plans. He expressed his belief in the alliance’s potential to provide solutions to global challenges.