Sweden – The IKEA Foundation and The Rockefeller Foundation are teaming up to create a $1 billion worldwide platform to combat climate change and energy poverty.
The platform, which will be launched this year, promises to eliminate one billion tons of greenhouse gas emissions while also empowering one billion people with distributed renewable energy (DRE). This is renewable energy generated through sources such as mini-grid and off-grid solutions, which are located close to the place of use, rather than centralized sources such as power plants. The aggregate matching money of the organizations will be managed through the new global platform. It seeks to provide clean and reliable power to the 800 million people globally who do not have access to energy, as well as the 2.8 billion who do. It will be administered as a public charity to coordinate a coordinated effort to quickly route development funds to life-changing projects on the ground.
Increased funding for energy transition
While worldwide funding for energy transition has increased, many groups are struggling to identify credible, investment-ready initiatives. As a result, many developing countries continue to rely on unreliable and harmful energy sources. Governments will be better able to meet renewable electrification and development targets if they create a platform to deploy catalytic capital more efficiently and at a scale that supports the expansion of local renewable energy projects.
The Rockefeller Foundation will incubate the platform in RF Catalytic Capital, which it will establish in 2020, to simplify the collaborative investment. This is a novel approach for impact investors and governments to pool their resources and broaden their global philanthropic reach.