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Electricity

Channel public money into green electricity, with sub-national governments leading the way

 

Multilateral and national development banks have broad leverage in shaping electricity infrastructure and must play a key role in facilitating investments. More loans for renewable projects will accelerate the transition towards a sustainable electricity sector. In 2019, the European Investment Bank, the world's largest international public lending institution, announced an end to fossil fuel energy project financing beginning in 2022. Similarly, Norway’s Government Pension Fund no longer invests in companies whose business models are focused on fossil fuels.

Sub-national and city governments can also lead the way towards a low-carbon economy, with more ambitious targets on greenhouse gas emissions reductions and higher shares of renewable energy. Copenhagen and Oslo for instance aim to become carbon neutral by 2025. Cities can leverage the low-carbon transition as owners and operators of energy infrastructure and public buildings, through direct investment in biomass plants, encouraging rooftop solar panels, and taking visible action to improve the energy efficiency of public buildings, for example though energy performance contracts and public-private partnerships.

 


EXPLORE FURTHER

Article: Radical innovation in the electricity sector, OECD Observer (2018).

Article: Carbon Prices are Still Far Too Low to Prevent Climate Change, OECD Observer (2018).

Report: Carbon Pricing and Competitiveness: Are They at Odds? OECD (2019).

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