The Norwegian Agency for Development Cooperation (NORAD) has issued a call for proposals for the first renewable energy guarantees.
The country has established a new state guarantee scheme for renewable energy projects in developing countries.
The Government’s guarantee scheme has an overall financial framework of NOK5bn (€0.42bn), and NOK1.75bn (€1.4bn) of this is being made available to companies and guarantee institutions under the call.
Around 65% of the financial framework has been set aside for guarantees issued in cooperation with multilateral development banks such as the World Bank, the African Development Bank and the Asian Development Bank.
The remaining 35% (NOK1.75bn) is being made available under the call.
Prime Minister Jonas Gahr Støre (pictured), said: “Roughly 700 million people lack access to electricity today.
“We must work to provide as many of them as possible with electricity, and this must come from renewable sources rather than fossil fuels.
“The guarantee scheme will be an important tool for securing greater access to clean energy in developing countries.
“This is vital to enable these countries to continue to develop and at the same time reduce the impacts of climate change.”
Norway’s Minister of International Development Anne Beathe Tvinnereim added: “The guarantee scheme represents a new way of thinking about development assistance.
“Norway has an AAA credit rating, which is the highest possible rating.
“We use this to guarantee funding for renewable energy projects to encourage more private companies to invest in sometimes challenging markets.
“In addition to promoting the green transition in developing countries and reducing greenhouse gas emissions, this helps to create jobs, which we know is a key to poverty reduction.”
Emerging markets and developing countries are in need of significant investment in order to achieve the UN Sustainable Development Goals.
There is a correlation between the countries with the highest levels of poverty, the least access to energy and the least developed financial markets. It is difficult for these countries to attract the capital required for the necessary energy investments.