Energy Finance: Emerging

CEE Concentration Registration Priority. Emerging and developing economies are expected to account for the bulk of the energy demand and carbon emissions growth in the coming decades. Drastic changes are necessary to their current energy systems and future energy infrastructure so that it is in line with global climate goals—an effort that will require significant amounts of capital. This course will look at the formidable task of financing the energy transition in emerging market and developing economies (EMDEs). We will start by studying what the energy transition is, how it relates to climate goals, and what needs to be financed. The course will look at the different estimates of how much will the energy transition cost, particularly for emerging markets. The class will also survey the current financial energy landscape to assess what is working, what is missing, and the potential governance structures that are needed to mobilize the necessary financing. The existing sources of financing from the private sector, development agencies, and international financial institutions will be discussed to understand the specific challenges and opportunities of each source of financing for emerging markets. The course will look at the broad financing toolkit available, from blended finance vehicles, de-risking instruments, and the new ones that are being deployed like ESG investing and thematic bonds. Students will also be introduced to carbon markets and the role they can play in financing the energy transition in emerging markets. Lastly, the course will cover the financing of transition assets to understand how and when capital should be deployed for these assets, including the capital needed to retire or retrofit existing fossil fuel assets.