Encouraging clean energy investment in developing countries: what role for aid?
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A large portion of foreign assistance for climate change mitigation in developing countries is directed to clean energy facilities. To support international mitigation goals, however, donors must make investments that have effects beyond individual facilities. They must reduce barriers to private-sector investment by generating information for developers, improving relevant infrastructure, or changing policies. We examine whether donor agencies target financing for commercial-scale wind and solar facilities to countries where private investment in clean energy is limited and whether donor investments lead to more private investments. On average, we find no positive evidence for these patterns of targeting and impact. Coupled with model results that show feed-in tariffs increase private investment, we argue that donor agencies should reallocate resources to improve policies that promote private investment in developing countries, rather than finance individual clean energy facilities.
Published Version (Please cite this version)10.1080/14693062.2014.953903
Publication InfoBuntaine, MT; & Pizer, William Aaron (2014). Encouraging clean energy investment in developing countries: what role for aid?. Climate Policy. 10.1080/14693062.2014.953903. Retrieved from https://hdl.handle.net/10161/10275.
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Professor in the Sanford School of Public Policy
Billy Pizer joined the faculty of the Sanford School of Public Policy at Duke University in the fall of 2011. He also was appointed a faculty fellow in the Nicholas Institute for Environmental Policy Solutions, a nonpartisan institute at Duke that focuses on finding solutions to some of the nation's most pressing environmental challenges. His current research examines how we value the future benefits of climate change mitigation, how environmental regulation and climate policy can af