Financing Renewable Energy Transition Toward Sustainable Development Goals: Policies and Economic Implications in the Era of Climate Change

Since the Sustainable Development Goals (SDGs) were established by the United Nations in 2015, a sustainable energy transition (SET) has played a crucial role as the seventh SDG for sustainable development, climate change adaptation, and mitigation. To provide sufficient access to affordable, reliable, and modern energy services, as well as to increase the overall energy efficiency and the portion of renewable energy in the world’s energy mix, countries across the globe need appropriate policies for boosting the consumption of sustainable energy. Policies might differ for each country or region depending on its specific economic development; however, they all play a crucial role in the world’s energy transition, energy efficiency, and SDGs. This chapter provides an up-to-date framework of the determinants of financing the SET and a newly developed framework of capital mobilization for financing the SET, high-lighting the roles of green finance worldwide. Given the newly developed theoretical framework and financial development in general, we find the critical functionality of sustainable capital markets and instruments for global capital mobilization, where policy incentives play an undeniable role in the SET. This chapter provides important implications for policy-makers, non-governmental organizations, and governments in financing energy transition in the era of climate change toward the SDGs.