The United States Treasury (U.S. Treasury) announced Thursday a $1 billion loan for clean tech fund. This will help advance U.S. climate commitments as well as just energy transition partnerships.
The U.S. Secretary of the Treasury Janet L. Yellen announced that Treasury has signed a loan agreement for the Clean Technology Fund (CTF)—a multilateral trust fund which helps to scale up low carbon technologies in developing countries–using resources appropriated by Congress and signed into law by President Biden. The funding will go towards coal transition investment plans which will be presented by South Africa’s, Indonesia’s, India’s, and the Philippines beginning in October 2022.
This contribution also makes good on the United States’ pledge to support the CTF’s Accelerating Coal Transition Investment Program made at the 2021 G7 Summit alongside G7 partners. The loan will support U.S. climate pledges, including Just Energy Transition Partnerships.
“Today’s $950 million loan to the Clean Technology Fund – the first of its kind from the U.S. Treasury – is a strong down payment on the President’s $11 billion climate finance pledge and an indication of our continued support for emerging market countries committed to transitioning toward clean and renewable sources of energy,” said Treasury Assistant Secretary for International Trade and Development Alexia Latortue.
“We expect this contribution to help drive the overall Just Energy Transition Partnership programs, while building on multilateral development bank expertise and engagement in these countries. This loan also represents an innovative approach to financing that is highly leveraged and thus allows us to achieve much needed greater scale of climate finance.”
The nearly $1B loan will be used to finance CTF projects by multilateral banks. It will also fund CTF projects that were developed in accordance with the priorities set out in the national accelerating coal transformation investment plans. These plans will be presented by the governments South Africa, Indonesia, India and the Philippines beginning in October 2022.
Programs that could be funded include projects to create new renewable energy, retire old coal plants, repurpose their infrastructure, and support programs to encourage new investment and job creation in communities affected by the energy transition.
Today’s strong support for climate action internationally complements work being done domestically. This week, during Treasury’s annual Freedman’s Bank Forum, Treasury officials outlined the ways in which the Inflation Reduction Act will help support building an equitable clean energy economy.
Source: newbusinessethiopia
