According to the UN DESA, a just energy transition is defined as “enhancing human well-being, health, and capabilities, increase resilience and drive innovation towards a sustainable society at all levels” (UN DESA, 2021). Therefore, the goal is to not only successfully transition to greener energy but prevent or minimise any injustices along the journey, equity of benefits and equity of capacities to achieve energy transitions.
So far, rapid transitions have been occurring in the global North whilst most, if not all, countries in the global South transitions are moving at a much slower pace (Akizu et al., 2017). This highlights the challenges of the high costs and challenges of transitioning. A successful energy transition requires investments in technological innovation and resource mobilisation, but this requires a substantial amount of capital. Unfortunately, countries in the global South do not have the financial capacity for such investments. Thus, through climate financing, developing countries can receive financial help needed to support their climate actions which includes transitioning to cleaner energy whilst also addressing other sustainable development needs.
However, there have been concerns and critiques about the efficiency of climate financing in the global South. The OECD itself acknowledges that there “significant inconsistencies in terms of methodologies, categorizations and definitions adopted across countries” when it comes to climate finance. Some of the concerns include:
– Available finance is not enough and the amount of money needed will continue to grow.
– Developing countries worry that industries that have grown through climate finance such as carbon markets, will allow rich countries to avoid painful emissions reductions at home while making marginal contributions to abate emissions abroad through buying credits.
– An international group of researchers recently published a study that indicated that climate adaptation finance was not doing what it was supposed to do. Instead, they found evidence this money was making communities more likely to be affected by climate change. This is because people who deliver this money to developing countries do not consider the reasons why these communities are affected by climate change in the first place, or what the communities need to protect themselves against climate change. The solutions offered are therefore likely to push communities into precarious situations that leave them more affected by existing or new climate problems
So how can climate financing be better utilised to facilitate just energy transitions for countries in the global South?
- Effectively increase private sector engagement in climate finance through working directly with organisation that are based in the countries.
- Better inclusion of the local community in all processes from the start through community-based approaches such as LSC, establishing community committees to monitor and frequent data monitoring of how the money is being utilized.
- Create opportunities for more citizens to be involved in decision making processes and benefit from the decentralisation of power. This is a great opportunity especially for historically marginalised and excluded communities. For example in African countries, due to the sociocultural views of gender roles, women lack access to basic energy services and lack opportunities to participate in decision making processes. Therefore, with just energy transition using polycentric governance, women would have an opportunity to have a seat at the table and this would likely have a positive impact on the uptake of cleaner energy sources in rural areas.
- Carry out baseline assessments to determine the actual situation on ground, the communities needs and how to approach mobilising resources to areas. This can help in reducing the risks in providing solutions that further push communities into precarious situations, leaving them more affected by existing or new climate problems.
In conclusion, just energy transitions can be achieved through tools such as climate financing that include polycentric and community based approaches, which would have a positive impact on the uptake of cleaner energy sources especially in rural and remote areas.