Global investment in renewable energy has experienced unprecedented growth in recent years, and yet it remains below its potential. Scaled up renewable energy investment on the foundation of sound enabling policy framework is critical to rapidly mobilize sustainable energy transition.

IRENA’s activities focus on mobilising various sources of investment (including private capital) in renewable energy projects through the effective use of financial instruments and risk mitigation tools.

Investment needs

If the global energy transformation is to happen, renewable energy investment needs to be scaled up significantly above current levels. Over time, IRENA has developed scenarios to estimate the investment required to progressively increase the shares of renewables in the global energy mix (up to 36% by 2030, and up to 65% by 2050), in line with the objectives of the Paris Agreement. 

Sources of investment

Public finance, including climate finance, provides an important resource to bridge the financing gap and attract further investment to renewables. Institutional investors such as pension funds, insurance companies, endowments and sovereign wealth funds have the potential to scale up major investments. IRENA’s Sustainable Energy Marketplace showcases several financial instruments and funds available to source investment for individual projects.

Mobilising private investment

To address the question of ‘how’ to scale up renewable energy investment rapidly with financing from prospective sources, IRENA has been engaging with governments and the international investor community to identify key risks and barriers and examine the current financing landscape in the renewable energy sector. 

Financing renewable energy projects

To overcome some of the barriers and challenges facing project developers and scale up renewable energy investment in developing countries, IRENA aims to facilitate project initiation, development and financing by offering appropriate tools and platforms to key market players including governments, project developers, investors.