The State of Blended Finance 2023: Climate Edition

This year’s edition of the State of Blended Finance once again focuses on climate. Climate change continues to be central to the blended finance market and to sustainable development more broadly.

Blended finance uses catalytic capital from public or philanthropic sources to increase private sector investment in developing countries to realize the Sustainable Development Goals and climate goals. Blended finance allows organizations with different objectives to invest alongside each other while achieving their own objectives (whether financial return, social/environmental impact, or a blend of both).

The report from Convergence drew on thought leadership and contributions from several organizations, including Duke University's Nicholas Institute for Energy, Environment & Sustainability. Jackson Ewing, director of energy and climate policy at the Nicholas Institute, and Jonathan Phillips, director of the James E. Rogers Energy Access Project at Duke, offered insights in parts V, VI, and VII of the report.

Part V explores country-level platforms in climate blended finance and evaluates Just Energy Transition Partnerships (JETPs) as a partnership model for mobilizing climate blended finance. JETPs are analyzed and compared through stakeholder interviews that identify strengths, challenges, opportunities, and recommendations.

Parts VI and VII highlight key areas where blended finance can contribute and offer specific recommendations on the role climate blended finance can play in driving private investments at scale while identifying the appropriate blended finance architectures in developing regions.

Ewing and Phillips were also among the experts and stakeholders interviewed for a deep dive on JETPs in the appendix.