Powering Up the Global South: Cleantech as a Path to Growth

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A new report shows that the Global South is adopting cleantech technologies more rapidly than the Global North. Countries in the Global South are deploying clean technologies at an accelerated pace and will continue to do so as a path to economic growth. Around three-quarters of the energy demand in the Global South is in the "sweet spot" for change, characterized by high fossil fuel imports, increasing energy demand, and vast renewable energy potential.

While the Global South accounts for 60 percent of the world’s population, it holds only 20 percent of global fossil fuel reserves. However, it boasts 70 percent of the world’s renewable energy potential. Currently, these countries are net importers of fossil fuels, and oil and gas production is in decline.

By 2024, 87 percent of capital expenditures in electricity generation in the Global South will be invested in clean energy. Solar and wind power have grown by an average of 23 percent annually over the past five years and now supply 9 percent of the region’s electricity. In terms of solar and wind energy adoption, the Global South is only five years behind the Global North. Already, one-fifth of the Global South—ranging from Brazil to Morocco and Namibia, from Bangladesh to Egypt and Vietnam—has surpassed the Global North in the share of solar and wind in electricity generation or the share of electricity in final energy consumption.

While there are reasons for optimism, more action is needed to accelerate the transition. Proposed solutions include stronger domestic policies, reforms of development banks, catalytic and concessional financing directed especially to poorer and vulnerable countries, and technology transfer. As COP29 approaches, it is time for countries’ policies to reflect the new economic reality of cleantech.

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