The Energy Sector Management Assistance Program's (ESMAP) annual Knowledge Exchange Forum May 7-9 investigated how results-based financing could work for energy projects to ensure that every dollar raised has an impact.
As international agencies seek financing to achieve the goals of the Sustainable Energy for All Initiative—providing universal access to electricity, doubling the share of renewable energy in the global energy mix, and doubling the improvement in energy efficiency—practitioners want to ensure that every dollar raised has the maximum possible impact.
Results-based approaches, in which financing is provided upon achievement of specified outputs, or targeted performance against specified macro-level indicators, are cited by many as the best way to go.
Although results-based approaches have been widely—and successfully—adopted in several sectors, especially health services, their deployment in the energy field has been limited. For many experts, that needs to change. Results-based approaches are essential, they say, if the push to bring electricity and clean fuels by 2030 to the world’s 1.3 billion people currently without access is to succeed.