Combatting climate change necessitates a substantial global increase in renewable electricity capacity. Many low-income and lower-middle-income countries suffer from unfavorable green financing conditions. Fifteen of these countries possess substantial natural gas reserves. To overcome green financing constraints in such countries, we propose an integrated energy contract that awards a renewable energy project in parallel with an upstream natural gas project to interested energy companies. The state returns from the natural gas project provide a guarantee for renewable energy investments, reducing their associated risks. We conduct Monte Carlo simulations for each of the targeted countries after populating the input parameters for the upstream natural gas and renewable energy projects, including forecasting country-specific natural gas prices. When accounting for 10% of their existing natural gas reserves in the proposed contract, Nigeria, Myanmar, and Indonesia can achieve more than 60% of their 2030 renewable energy target capacity additions while countries with low access to electricity can significantly upscale their installed capacities. The guarantee mechanism provides protection levels exceeding 96% on renewable energy investments. The proposed contract enables the considered countries to increase their renewable energy capacities while inducing economic development.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.