The IKEA Foundation and the Rockefeller Foundation said on Monday they plan to set up a $1bn fund to support renewable energy programs in developing nations.
Specifically, the two foundations hope to attract additional funds of $10 billion over the course of 2021 from international development agencies, before opening up to institutional investors in their bid to expand renewables investment in countries such as Nigeria, India and Ethiopia.
The fund, which was to be launched in 2021, aimed to reduce one billion tons of greenhouse gas emissions and empower one billion people with distributed renewable energy, the foundations said in a joint statement.
Renewable energy generated from sources such as mini-grid and off-grid solutions, located near the point of use, instead of from centralized sources such as power plants.
The new global platform will oversee the organizations’ combined matching funds. It aims to deliver clean and reliable power to the 800m people worldwide who lack electricity, and a further 2.8bn who have unreliable access.
“If global energy consumption doesn’t change from fossil fuels to renewable energy, we will not meet the Paris Agreement ambitions and millions of families will be left behind in poverty. We need to be honest and recognize that the current approach is not delivering the impact the world needs in the time that we have,” said Per Heggenes, CEO IKEA Foundation.
“We need to replace polluting sources of energy with renewable ones, provide access to energy to communities and unlock further funding for sustainable models. Ultimately, we aim to unite countries and communities in urgent action to tackle the climate crisis, reduce 1 billion tons of greenhouse gas emissions and, by doing so, we hope to positively impact the lives of 1 billion people,” Per added.
Dr. Rajiv J. Shah, President of The Rockefeller Foundation added: “Big, bold, and pioneering collaboration and investment is required not only for the short term, but also the long term, to galvanize a better future. That is why we are announcing our largest commitment to date and joining forces with IKEA Foundation to double that investment. Our partnership will unlock the financing and resources that are essential to provide clean, reliable electricity that improves the lives and livelihoods of people everywhere.”