OPEC Fund Quarterly - 2023 Q1

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INTERVIEW

Across many low- income economies, the lights are simply kept on with bottom of the barrel diesel generators. That’s the simple truth of it and that brings us full circle, back to my first point: Why wait?

protectionism. To ensure environmentally sustainable economic prosperity, every country will need the best, most cost- effective solutions customized to their developmental needs. At the same time, we know that our environmental and climate concerns are not restricted to borders, so neither should the solutions. OFQ : Essentially, you’re talking about a change in cultural governance, as much as focusing on innovation for efficiency. MAR: Yes, but it actually goes much further than that. For emerging economies, the very strong message is to take ownership of your projects. Based on experiences in so many countries, it’s clear that ownership leads to higher efficiency – because the government has a stake and the people have a stake, which helps to ensure that resources are not wasted. Whether it’s wind, hydrogen, green ammonia, or any new technologies that claim to improve efficiency – unless the end users are sufficiently aware and sufficiently care about making the best possible use of the energy and the technology, then massive inefficiencies will remain locked into the system. OFQ : That’s all very well, but how can we ensure a smooth, just and inclusive transition? Development needs to continue. MAR: Yes, that sounds like the old trope of needing to “keep the lights on” during the energy transition. Across many low- income economies, the lights are simply kept on with bottom of the barrel diesel generators. That’s the simple truth of it and that brings us full circle, back to my first point: Why wait? Most economies with large growth potential are waiting because they don’t

OPEC Fund Quarterly : How is the OPEC Fund contributing to the achievement of SDGs 7 and 13? What have been our most impactful projects in recent years? Fuad Albassam: Ever since we were established in 1976, the OPEC Fund has financed energy projects in developing countries. The sector has always been our main focus, and our portfolio especially targets energy poverty, including the generation, transmission and distribution of electricity in both urban and rural settings. We’ve funded clean energy projects worldwide, including wind and solar photovoltaics. We’ve also funded “multipurpose” hydropower plants, which provide not only electricity but also water for irrigation and drinking – thus helping to meet additional development goals as well as humanitarian demands linked to food security. OFQ : What is our focus for the next few years? FAB: In September 2022, we approved our first Climate Action

Mueid Al Raee, United Nations University, Doctoral Fellow

have the capital for large infrastructure projects and because there are no companies ready to invest – because the risk is high and because governments are not able to offer sufficient “comfort” or guarantees. We need to get out of this vicious cycle if we’re serious about actions to limit and curtail environmental harm and if we’re serious about sustainable development. We need to stop thinking of renewables as the future – they must be the present, mainstreamed and normalized by 2030. There will never be a better time to jump on the carousel of the circular economy and build up a never-ending momentum. If we leave it too long, it will soon be too late. The UN and international development agencies need to push the political agenda and governments need to agree on common regulatory standards and conditions; in the meantime multilateral development banks can act as go- betweens between the public and private spheres. Everyone needs a stake. Our best hope of success is to put power in the hands of the people.

Plan, where we committed to doubling our share of climate financing by 2030, rising from

30

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