Energy

Energy is at the heart of development. Energy makes possible the investments, innovations, and new industries that drive jobs, inclusive growth, and shared prosperity on a livable planet.

Yet nearly 700 million people still live without electricity worldwide, and about 2.3 billion people rely on polluting traditional fuels and technologies to cook their meals. Scaling up renewables and energy efficiency, investing in electrification at scale, and improving power utilities while avoiding new coal plant construction and retiring old plants are critical to providing clean energy to power homes, schools, hospitals, and businesses.  
 

Energy Shocks Hit the Poor the Hardest

Global shocks such as the COVID-19 pandemic, the war in Ukraine, and conflict in the Middle East have further slowed progress toward achieving universal access to affordable, reliable, sustainable, and modern energy by 2030 (Sustainable Development Goal (SDG) 7). Developing countries have faced the highest burdens as they have limited capacity to mitigate energy price volatility, exacerbating poverty. 
 

Renewables are Key to Green, Secure, Affordable Energy

Renewable energy can help countries mitigate climate change, build resilience to volatile prices, and lower energy costs. Solar and wind technologies are game changers, as they are abundant in many developing countries, cost-competitive, and a source of reliable power when combined with storage. Hydropower also provides clean, renewable energy, one of the lowest-cost sources of electricity for consumers.  

Solar mini-grids can provide high-quality, uninterrupted electricity to nearly half a billion people in underserved communities and be a least-cost solution to close the energy access gap by 2030.
 

Financing the Energy Transition 

Energy consumption accounts for more than three-quarters of greenhouse gas emissions. Accelerating the energy transition requires financing the massive deployment of renewable energy and energy efficiency while gradually retiring fossil fuels. However, in developing countries, constrained fiscal space and lack of access to finance make costly upfront investments in energy efficiency and renewable energy out of reach. In addition, macroeconomic and political uncertainties discourage investors.

Multilateral development banks and donors play a critical role in scaling up support to countries with more affordable concessional financing to reduce the steep upfront costs of clean energy projects. The World Bank partners with governments to set policy direction, establish sound regulatory and macroeconomic frameworks, and strengthen institutions—including power utilities, the backbone of the electricity sector—that can help create a series of bankable projects.  

Private sector investment is crucial for achieving the sevenfold increase in investments needed in developing countries for energy access and transition—roughly $1-2 trillion by 2030—which also directly benefits job creation.

Last Updated: Oct 18, 2024

The World Bank Group is scaling up knowledge and financing to deliver faster and more effective energy solutions. This will help our clients transition to a clean energy future that meets growing demand, boosts growth, and lifts millions out of poverty.  As the world grapples with multiple crises, we focus on the next frontier in energy access to reach poor and vulnerable populations, particularly those affected by fragility, conflict, and violence (FCV).

The World Bank Group is one of the largest financiers of renewable energy and energy efficiency projects in developing countries. Renewable energy is always our first choice when considering energy investments. 

• Between FY17 and FY24, the World Bank Group has directly financed nearly $16.4 billion for renewables—a steady increase from $1.4 billion in FY17 to more than $3 billion in FY24.
• Globally, our current programs have provided access to electricity to 171 million people. 

• We have not financed any new coal-fired power project since 2010, and no oil and gas projects that involve exploration, drilling, and extraction (upstream) since 2019. The World Bank has not financed any oil pipelines since 2014. 
   

Mission 300

We have partnered with the African Development Bank on an ambitious initiative called Mission 300 that scales up our support to governments in connecting 300 million people in Africa to electricity by 2030. African governments are leading this initiative with a strong commitment to undertake reforms needed to attract greater financing and deliver more access to more affordable, more reliable energy. 

 We are already developing programs in Africa to reach our target. In Eastern and Southern Africa, we launched the Accelerating Sustainable and Clean Energy Access Transformation (ASCENT) Program to provide electricity access to 100 million people in 20 countries. In Nigeria, the Distributed Access through Renewable Energy Scale-up (DARES) project alone will provide new or improved electricity access to 17.5 million people.  

Partners, such as the Rockefeller Foundation, Sustainable Energy for All (SEforALL), and the Global Energy Alliance for People and Planet (GEAPP), are helping to mobilize greater public and private financing needed to reach Mission 300’s ambitious goals.  Learn more…
 

The Critical Link: Empowering Utilities for the Energy Transition

The global energy transition and universal access goals present opportunities for improving utility performance. However, only well-managed and well-regulated utilities can provide clean, affordable electricity to a growing customer base while ensuring a reasonable return on investment. Building sustainable power utilities will require concerted efforts from policymakers, regulators, development financiers, and utilities. Learn more…
 

Scaling Up Clean Energy to Phase Down Coal

The World Bank has outlined a vision for how the global development community can support developing countries in overcoming the critical barriers paralyzing the power sector. “Scaling Up to Phase Down” is a roadmap to catalyze financing and sustain a virtuous cycle that unleashes urgently needed investments in the power sector transition.

The energy transition is distilled into six steps—a “virtuous cycle”—that starts with government leadership, which translates to a supportive regulatory environment, increasingly capable institutions, and instruments to minimize risks. This is followed by transparent and competitive project allocation, which can deliver clean energy for urgent needs, including energy security, affordability, and jobs. Learn more…
 

Ramping up Support to Reduce Methane Emissions

The global energy sector accounted for approximately 40% of methane emissions in 2021. Methane emissions from venting, leaks, and flaring in the oil and gas sector are currently estimated to be responsible for 25% of global human-made methane emissions. Deploying the full potential of methane reduction solutions in the oil and gas sector could avoid 0.1 degrees Celsius of warming by mid-century—equivalent to zeroing out the emissions of every car and truck in the world.

The World Bank supports countries' efforts to reduce methane emissions as an effective short-term measure to address climate change quickly. Learn more...
 

Extractives and Critical Minerals

Due to the energy transition and urbanization, the demand for metals, minerals, and mineral products rapidly increases. By 2040, the world must mine 6 to 13 times more critical minerals for batteries and electric vehicles. Mining's physical footprint will expand, exacerbating current social and environmental challenges. 

The World Bank supports long-term engagement in policy dialogue and securing investment to help countries translate mineral wealth into economic development that benefits all citizens on a livable planet. Our work supports good governance and environmental and social standards, investing in strategic infrastructure and human capital, unlocking private mining investments in environmentally and socially sustainable ways, and facilitating cooperation and trade. The Extractives Global Programmatic Support Umbrella Trust Fund (EGPS), with over $100 million in donors’ contributions, is critical to promoting this mandate. Learn more...
 

Resilient and Inclusive Supply-chain Enhancement (RISE) Partnership  

The RISE initiative, launched in October 2023 in partnership with the G7, provides capacity building, technical assistance, and knowledge sharing to help low—and middle-income countries boost investments in midstream and downstream mining. 

RISE supports the development of diverse and inclusive supply chains for clean energy products that promote skilled workforce development, generate quality jobs and safe, inclusive, and ethical work environments, and contribute to economic diversification and resilience. Learn more…

Last Updated: Oct 18, 2024

Energy access is fundamental to any successful development effort. The World Bank supports countries to ensure that the transition to more diversified and cleaner sources of energy meets growing demand, brings economic growth, and creates jobs on a livable planet.

Energy efficiency and renewable energy can mitigate climate change and ensure energy reliability and security. The World Bank Group is one of the largest financiers of renewable energy and energy efficiency projects in low- and middle-income countries. We work with partners, including the Energy Sector Management Assistance Program (ESMAP), to help achieve universal access to energy by 2030.
 

Below is a selection of our key investments and results:
 

Renewables

In the last seven years (FY17 to FY24), the World Bank Group directly invested nearly $16.4 billion in renewables—a steady increase from $1.4 billion in FY17 to over $3 billion in FY24. Almost two-thirds of this support is for transmission and distribution infrastructure to facilitate the integration of renewable energy, guarantees, and upstream support for enabling policies, regulations, and institutions to scale up private investments in renewable energy.

• In FY24, our innovative programs blazed new paths to meet global energy challenges. The Europe and Central Asia Renewable Energy Scale-up (ECARES) program, a $2 billion 10-year, multi-phased initiative, will enhance energy security and affordability, providing 15 GW of renewable energy capacity and reducing 240 million metric tons of carbon emissions in emerging and developing economies in the region.

• Similarly, in Pakistan, we have committed an additional $1 billion to support renewable energy generation, green the country’s power sector, and reduce the cost of electricity.

• In India, the Bank supported the government in establishing a sovereign green bond program - the first of its kind - to finance renewable energy and electrifying transport systems throughout the country.

• The World Bank approved $268 million to support the new Tunisia-Italy electricity interconnector. The project will support the renewable energy trade essential to Tunisia’s sustainable development and climate change strategy and increase clean electricity trade across the Mediterranean.

Solar and wind technologies are revolutionizing the power sector. They are a game changer for developing countries as solar and wind are abundant, cost-competitive, and a source of reliable power when combined with battery storage. 

• Through the $311 million Regional Emergency Solar Power Intervention Project (RESPITE), the World Bank is helping increase grid-connected renewable energy capacity and strengthen regional integration in Chad, Liberia, Sierra Leone, and Togo.

• In Yemen, the World Bank enabled over 91,000 households—21 percent of which were headed by females—to acquire subsidized solar energy systems that support healthcare, education, and water services for 3.2 million people.

• In Bolivia, a World Bank-supported renewable energy has connected some 20,200 people to the power grid in remote, underserved areas.

• In Bangladesh, the World Bank supports the largest off-grid program in the world through 2.41 million solar home systems, 1,300 solar irrigation pumps, 14 solar-based mini-grids, and 3 million efficient cookstoves. Through this program, around four million people in rural areas now have reliable access to clean energy, creating 30,000 jobs.

• In Maldives, the World Bank is helping install 53.5 megawatts (MWh) of solar panels on the islands and in the open ocean, build 40 MWh of battery storage and upgrade the electricity grid to include cleaner energy sources.
   

Powering a brighter future for Africa

Across Africa, half the population has no access to electricity, creating significant barriers to healthcare, education, productivity, digital inclusivity, and job creation. The World Bank has scaled up support for renewable energy access and energy transitions:

• The Accelerating Sustainable and Clean Energy Access Transformation Program aims to increase access to sustainable and clean energy across the region by 2030. The program will benefit 100 million people by expanding access to grid and off-grid electricity in a region where only 48 percent of the overall population—and just 26 percent in rural areas—has access to electricity.
• In November 2023, the World Bank supported the launch of a new 25-megawatt solar park with battery storage in the Central African Republic. The park will supply electricity to 250,000 people in the capital of Bangui, almost doubling the country’s electricity generation capacity. It will replace over 90 percent of the energy currently produced by diesel fuel while generating more than $4 million annually for the National Electricity Company.
• In Nigeria, more than 17.5 million Nigerians, or 20 percent of the currently unserved population, will benefit from our Nigeria Distributed Access through Renewable Energy Scale-Up Project, which will replace more than 280,000 polluting and expensive fossil-fueled generator sets with standalone solar.
• We are completing the 225-kilovolt transmission line of the Gambia River Basin Development Organization, which will connect the Gambia, Guinea, Guinea-Bissau, and Senegal through 15 substations, such as the Tambacounda power station.

These projects, and many others, are laying the foundation for the Bank Group’s Mission 300, which, in partnership with the African Development Bank, aims to connect 300 million people in Africa to electricity by 2030. 
 

Energy efficiency

Energy efficiency is always faster and cheaper than building new generation capacity. Between FY20 and FY24, the World Bank (IBRD/IDA) invested about $6.2 billion to support energy efficiency, including direct investment in public infrastructure such as public buildings or street lighting.

• In Benin, we support energy efficiency by providing 24,670 new households access to improved cooking equipment and 25,000 households access to improved cookstoves. The country has reduced more than 113,000 tons of CO2 emissions due to improved efficiency of lighting and appliances.
• In India, reducing energy demand through measures—ranging from subsidized energy tariffs to deploying 366 million LED bulbs—will save 11,200 GWh of electricity annually.
• In Uzbekistan, where buildings account for 50% of energy consumption, the World Bank supports the country to improve the energy efficiency of public buildings with a $143 million concessional credit.
   

Energy access

Between FY20 and FY24, the World Bank (IBRD/IDA)  approved about $8.1 billion to support energy access. We are ramping up support and leveraging private investments to deliver impact at scale.

• The Accelerating Sustainable and Clean Energy Access Transformation (ASCENT) Program will put 20 countries in Eastern and Southern Africa on the path to universal energy access, providing sustainable and clean energy access to 100 million people by 2030. Over the next seven years, the program will provide $5 billion in IDA financing and leverage $10 billion of additional private, government, and donor funding for clean-energy access. The program is underway in Rwanda, São Tomé and Príncipe, Somalia, and Tanzania.
• In Rwanda, we supported the country in reaching near-universal electricity access. The government has expanded electricity access from 6 percent in 2009 to more than 75 percent as of March 2024 by providing new or improved energy grid access to 230,000 households and off-grid energy access to another 150,000 households. One hundred percent of its health centers and administrative facilities and 84 percent of its schools have been electrified.
• In Tanzania, more than 4.5 million people gained access to electricity. In contrast, over the past decade, more than 1,600 healthcare facilities and 6,000 educational institutions added new connections—emerging as one of the fastest rates of energy-access expansion in Sub-Saharan Africa.
• In Western and Central Africa, over 10.3 million people have received new or improved electricity services from ongoing projects.
• In Senegal, more than 13.2 million people have benefitted from improved electricity access and reliability.
• As part of the West Africa Power Pool Program, the World Bank supported the construction of the Ghana-Burkina Faso Interconnector, which significantly reduced the cost and increased the security of electricity supply to Burkina Faso while increasing Ghana’s electricity-export capacity.
• The World Bank’s mini-grid portfolio amounts to over $1.4 billion. It will support more than 3,000 mini-grids in 30 countries, bringing electricity to more than 380 million people by 2030 and enhancing sustainability and resilience to climate change.
   

Energy for clean cooking

Access to clean cooking is fundamental to achieving Sustainable Development Goal 7.1 and is closely tied to progress in health (SDG 3), gender equality (SDG 5), poverty reduction (SDG 1), and climate action (SDG 13). Yet 2.1 billion people lack access to clean cooking solutions. Women bear the brunt and suffer from poor health, insecurity, and lost productivity.

• Between July 2015 and April 2024, the World Bank provided about $773 million for clean or improved cooking to support 105 million people across 34 access-deficit countries—in Africa and Asia.
• The Bank established the Clean Cooking Fund through ESMAP with a funding target of $500 million. It aims to leverage $2 billion in public and private investments to help 200 million people gain access to clean cooking.
• The Clean Cooking Fund has supported allocating $107 million in grants directly to 27 countries and co-financing ten projects. The current portfolio has leveraged $210 million from IDA/IBRD, $311 million from private financing, and $10.81 million from carbon finance, helping more than 40 million people and 1,500 schools access clean cooking solutions.
   

Extractives and Critical Minerals

The energy transition creates a trillion-dollar market with tens of millions of jobs along global mineral value chains. Countries can benefit beyond mining and raw minerals exports to capture a larger share of the value added to their mineral production.  The World Bank supports countries in harnessing the economic benefits of their mineral resources sustainably, minimizing negative impacts on people and the environment, and promoting sustainable low-carbon practices. We also help countries develop value-added opportunities, including minerals processing and manufacturing clean-energy products that can generate jobs and demand for skilled labor. Learn more
 

Just Transition Away from Coal 

The World Bank's Global Coal Transition Program (GCTP) offers a holistic approach to helping countries scale down coal production by engaging multiple sectors and the entire society. In the past two decades, the World Bank has provided more than $3 billion to support governments in closing coal mines and power plants and ensuring a Just Transition that safeguards the environment, jobs, and income in affected communities.  
 

Methane Reduction

The rapid reduction of methane emissions is one of the most impactful climate actions we can undertake in the short term to address climate change quickly. The World Bank supports client countries in the global effort to reduce methane emissions.

• At COP28, the World Bank launched the Global Flaring and Methane Reduction (GFMR) Partnership, a new $250 million fund focused on helping developing countries cut carbon dioxide and methane emissions generated by the oil and gas industry.
• IFC supported one of the world's largest gas flaring reduction projects in Iraq that helped avoid unnecessary flaring while supporting Iraq's energy transition and expanding energy access.
• In Egypt, GFMR supports the decarbonization of the energy value chain.
• In Bangladesh, the World Bank is helping reduce methane emissions and carbon dioxide by an estimated 7.7 million tons per year.
   

Battery and Energy Storage

The World Bank has mobilized approximately $850 million in global climate financing for battery storage and energy storage deployment projects. 

• The World Bank financed 6.5 GWh of battery storage capacity in active projects and an additional 1.6 gigawatt in future pipelines.  The World Bank convened the global Energy Storage Partnership (ESP) hosted by ESMAP to foster international collaboration toward accelerating the deployment of energy storage globally.
• The Bank’s Energy Storage Program has helped  scale up sustainable energy storage investments and generate global knowledge on storage solutions, including:
  • Catalyzed public and private financing amounting to $725 million in Burkina Faso, Ethiopia, Maldives, Sierra Leone, Tanzania, Ukraine etc., amongst other countries and regions.
  • Supported over 14 World Bank lending projects (including six mini-grid projects) to deploy renewable energy and storage solutions and increase battery storage capacity by 2,527 MWh.
  • Helped finance India's largest battery project to date—a 120 MWh facility commissioned in November 2023 by the Solar Energy Corporation of India (SECI).
  • The Bank supports Small Island Developing States (SIDS) like the Maldives to embrace storage solutions by installing more than 53.5 MW of solar capacity and 40 MWh of battery storage.
     

Power Utilities

Electric utilities are the critical link between power generation and electricity distribution to homes and businesses. The World Bank supports countries to improve utilities’ performance through policy, regulatory, institutional, and governance reforms. We also assist utilities in strengthening their operational and financial performance. Our recent report, The Critical Link: Empowering Utilities for the Energy Transition, takes stock of current utility performance challenges in Bank client countries, assesses the threats and opportunities to utility performance that energy transition may create, and highlights solutions to support utilities in navigating the energy transition.

In FY20-24, the World Bank approved about $7.9 billion to improve utility performance.

• In Rwanda, the World Bank has helped increase electricity access from 10 percent in 2010 to 54 percent in 2020 by improving the quality and reliability of electricity supply and the capacity of the sector institutions, such as utilities.

• In 2022, the World Bank launched the Utility Knowledge Exchange Platform to help utilities, energy sector institutions, regulators, system operators, the private sector, and the World Bank identify best practices, improve operational efficiencies, stimulate businesses, and accelerate technological innovation.
   

Clean Hydrogen

The World Bank supports countries in deploying clean hydrogen to decarbonize critical sectors such as transport, industry, agriculture, and mining. The Bank launched the Hydrogen for Development Partnership to catalyze financing for hydrogen investments in developing countries and approved more than $1.5 billion in concessional financing to ramp up clean hydrogen projects in FY2024. This is the largest hydrogen engagement among all Multilateral Development Banks.

• In India, our two development policy operations worth $3 billion will help the country develop a green hydrogen industry to create jobs and boost energy security. 

• In Chile, the World Bank approved a $150 million project in 2023 to promote the hydrogen industry, leveraging $1 billion in additional financing.  

• Together with other MDBs and DFIs, the bank is preparing a 10 GW lighthouse initiative to accelerate the Final Investment Decision for the first sizeable projects in EMDCs.
   

Hydropower

Hydropower is a clean, renewable energy source that is one of the lowest-cost sources of electricity for consumers. Since 2002, the World Bank has supported 131 hydropower projects in 68 countries, investing $17 billion.

• In Pakistan, World Bank support for Tarbela hydropower provides clean energy to millions of people and has saved the country $2 billion.

• In Vietnam, the World Bank helped develop the Trung Son hydropower plant, which has supplied 1 billion kilowatt-hours (kWh) of low-cost electricity since 2017, improving the livelihoods of 3,400 households and reducing greenhouse gas emissions by 1 million metric tons annually.

• In Nepal, we signed a Memorandum of Understanding with the Asian Development Bank to strengthen the country’s hydropower sector through joint financing and advisory services. 

• In Bhutan, we provided technical assistance to help establish rules and procedures for participation in carbon markets so the government can monetize emission reduction credits from hydropower

Last Updated: Oct 18, 2024