Session 4.2: Increasing Private Sector Investments

In order to achieve mid-term sustainable development goals and long-term Net Zero Emission goal investment in the power sector needs to increase significantly. This includes investment in grids in order to facilitate the integration of variable renewable energy. Transmission grids in the Asia-Pacific region are mostly financed by the public sector, however in order to reach the needed levels of investment all sources of finance must be unlocked. In this presentation we will look at different models that could allow for private finance in the transmission sector, what is needed to implement them and examples of where they have been applied.

The drivers of private investment in renewable energy are assessed by source of financing, namely asset finance, corporate R&D, public markets, and venture capital and private equity. In particular, controlling for macroeconomic and financial market conditions, the role of public policies on renewable energy (public investment in R&D, feed-in-tariffs, and tax incentives) in leveraging private investment is examined for a sample of Asian and other economies.