The International Renewable Energy Agency (IRENA) faces a significant financial hurdle as the United States plans to withdraw its membership, impacting the organization’s budget by over 20%. Despite this challenge, IRENA’s leadership remains steadfast, asserting that the global shift toward renewable energy is irreversible.
During a press briefing at IRENA’s 16th Assembly in Abu Dhabi, Director-General Francesco La Camera clarified that the US has not yet officially communicated its withdrawal. According to IRENA’s regulations, a member’s withdrawal is effective at the end of the year when the notification is received.
La Camera emphasized that until formal withdrawal, the US retains full membership rights, including voting, alongside its obligation to contribute financially.
In a recently approved budget for the next two years, IRENA’s member states, numbering around 170, outlined the US’s expected contribution of 22% to the core funding, amounting to nearly $5.7 million for 2026.
To address this potential shortfall, La Camera mentioned ongoing discussions with governments and private entities to secure alternative funding sources, drawing parallels with past situations involving the UN climate secretariat and the Green Climate Fund.
“We know that some of these usual donors are considering to put something in our budget – we are also trying to get some money from the companies that are part of our initiatives… and we will see other ways that we can pursue,” he said. “I know that we can manage one way or another.”
While there was speculation that China might step in to fill the financial void during closed-door discussions, this did not materialize. Key European nations, including Germany and the United Arab Emirates, continue to be major contributors, but the agency’s core budget has remained stagnant since 2018, limiting its capacity to expand amidst rising global demand for renewable energy support.
La Camera indicated that following the US’s previous decision to withdraw, IRENA might propose budget amendments for 2026-2027 in its upcoming meeting in May.
Melford Nicholas, Antigua and Barbuda’s minister of information technologies, utilities, and energy, and newly appointed vice president of IRENA, remarked to Climate Home News that the US exit was “not an insignificant development” but suggested European countries might compensate for the deficit.
Clean Energy: A Necessity and an Opportunity
In the assembly’s opening session, La Camera and other officials highlighted renewable energy as a crucial component for energy and economic stability amid escalating geopolitical tensions linked to fossil fuels.
Selwin Hart, special adviser to the UN Secretary-General on Climate Action and Just Transition, stated the global shift to clean energy is driven by “opportunity and necessity,” not idealism. He noted that three-quarters of the global population live in countries that import fossil fuels, leaving them vulnerable to geopolitical instability and fluctuating prices.
He cited the spike in European gas prices following Russia’s 2024 invasion of Ukraine as an example.
“The energy transition is taking place… not only based on climate considerations, but based on costs, based on competitiveness and energy security and energy independence,” Hart explained. “These are the driving forces now – hardcore economic, hardcore national security [and] strategic reasons.”
Brazil’s Lula requests national roadmap for fossil fuel transition
Annalena Baerbock, president of the UN General Assembly, emphasized in a video message that despite political and economic challenges, the transition to renewable energy is “unstoppable.” She highlighted the increase in global renewable capacity to over 4,400 gigawatts, nearly 30 times what it was in 2015, alongside a record $2.4 trillion investment in 2024.
Baerbock and Hart both stressed the need for increased support for African nations, which currently receive only about 2% of global clean energy investment.
Challenges Facing Small Island States
As IRENA’s Assembly continues, small island developing states (SIDS) have been vocal about their struggles to transition from expensive, polluting energy sources amid escalating climate-induced disasters like cyclones.
Antigua and Barbuda’s Minister Nicholas highlighted the difficulty of obtaining insurance for renewable energy projects, a challenge exacerbated by climate change impacts, as evidenced by the destruction of a solar plant in Barbuda during Hurricane Irma in 2017.
Nicholas stated that concessional finance remains crucial for SIDS, warning that the current global environment might make such funding “increasingly challenging.” He added that Antigua and Barbuda is targeting a 60% renewable energy mix by 2030, down from an initial 100% goal.
Despite these hurdles, Caribbean countries like St Kitts and Nevis and Dominica are making strides with geothermal projects to reduce reliance on fossil fuels.
La Camera expressed optimism about reaching a global goal of tripling renewable energy capacity by 2030, though he acknowledged the need for progress in improving energy efficiency. IRENA plans to collaborate with COP host nations to develop a roadmap for fossil fuel phase-out, a plan expected to be unveiled at the COP31 summit in Turkey in November.
Original Story at www.climatechangenews.com