Clean Energy Costs Plummet, But Financing Hurdles Remain

Renewable energy sources, particularly solar and wind, have become more affordable than coal and natural gas for utility-scale electricity production, driven by technological advancements. In 2024 alone, global renewable capacity additions reached a record 585 gigawatts, comprising over 90% of all new capacity and saving nations US$467 billion in fuel costs. Beyond economic advantages, shifting from fossil fuels significantly improves public health by reducing air pollution linked to millions of deaths annually.

Despite these benefits, regulatory hurdles and political gridlock slow deployment, even in developed nations like the United States where permitting can take years. A more pressing issue affects developing countries, which require massive energy expansion to meet growing demand. The primary obstacle is the high cost of financing renewable projects, which is often greater than for fossil fuel alternatives due to established financial mechanisms and perceived lender risk for renewables.

Overcoming these financing challenges is crucial for developing economies to fully embrace the renewable energy revolution and avoid locking in decades of greenhouse gas emissions. International cooperation, government guarantees, and stable energy policies are essential to lower borrowing costs and make clean energy the accessible choice, thereby mitigating climate change and realizing substantial economic and health gains worldwide.