Power companies, backed by Germany, UK and major funds, warn outdated climate finance rules and underfunded grids risk derailing net-zero transition

Global power utilities have sharply raised their planned investments in clean energy networks but warned that outdated climate finance rules and underfunded grids threaten to slow the energy transition, at the UN climate conference COP30 in Belém.

The Utilities for Net Zero Alliance (UNEZA) on Friday increased its collective annual investment target for renewable energy transmission and storage systems from USD 117 billion to USD 148 billion. The 73-member coalition, which brings together leading power utilities and electricity service companies, now expects to build a project pipeline worth USD 1 trillion by 2030.

Backed By Germany, UK Multilateral Funds
At an event in the COP30 Blue Zone, Germany, the United Kingdom, seven multilateral funds and several investor coalitions endorsed a new report by the Green Grids Initiative, titled “Climate Finance Principles for Grids”.

The document warns that current climate finance rules exclude more than 60 per cent of global transmission and storage projects, despite their critical role in integrating renewables and cutting fossil fuel use. It calls for recognising grid infrastructure as a catalyst for decarbonising coal- and gas-dependent regions and for reorienting finance towards system flexibility and storage.

Endorsing countries and institutions include the UK, Germany, GIZ, KfW, the African Development Bank, British International Investment, the East African Development Bank, the Inter-American Development Bank, the Climate Bonds Initiative, the Institutional Investors Group on Climate Change, the Asian Investors Group on Climate Change, the Global Renewables Alliance, GridWorks and UNEZA.

Opportunity Of Our Generation
COP30 High-Level Climate Champion Dan Ioschpe noted that while renewable generation has expanded quickly, grid and storage investment is lagging. Spending on these systems rose by only 9 per cent in 2024, he said, exposing a significant financing gap.

“If we can align capital, capacity, and collaboration, we can accelerate this transition together, not as an obligation, but as the greatest economic opportunity of our generation,” Ioschpe said, stressing that efficiency, resilience and distribution capacity will determine how much clean power can actually reach consumers.

Other speakers highlighted that much of the world’s power infrastructure still reflects last-century technologies. Without modernisation, they warned, the pace and scale of the transition will stall.

“If we do not finance grids and flexibility, the speed and scale of the transition will be compromised,” said Francesco La Camera, Director-General of the International Renewable Energy Agency (IRENA).

From Pledges To Projects
Bruna Cerqueira, General Coordinator of the Action Agenda in the COP30 Presidency, welcomed the investment pledges but pressed for follow-through. “We appreciate the fact that many have supported these measures, but what we want is to continue this work over time. This cannot be just an event at COP. We need consistency,” she said.

On the host country’s plans, Brazil’s National Secretary for Energy Transition and Planning, Gustavo Ataíde, said the country is rolling out one of the most ambitious transmission expansion cycles in its history. This includes a 2,500-kilometre high-voltage direct current line with a 3-gigawatt capacity and new international interconnections.

“These initiatives demonstrate that building modern, resilient grids ready for renewable energy is possible when planning, institutions, and financing are aligned,” Ataíde said. “The world must move from political momentum to concrete progress, particularly in expanding storage solutions and doubling grid investments by 2030.”

With UNEZA’s higher target and the new grid finance principles on the table, negotiations in Belém are expected to sharpen attention on whether public and private finance can be redirected quickly enough to upgrade networks that underpin net-zero pathways.