The IKEA Foundation, a philanthropic organization formed by the founder of furniture giant IKEA, and The Rockefeller Foundation have set up a $1 billion platform to develop minigrids and other decentralized energy projects for the 3.6 billion people with unreliable electricity or none at all.
Announced Monday, the program aims to reduce 1 billion tons of greenhouse gas emissions by offering clean electricity to supplant the dirtier fuels often used for cooking and light by off-grid communities.
The organizations hope the platform will allow for efficient distribution of catalytic capital, at scale, to help local governments achieve their renewable electrification and development targets.
“If global energy consumption doesn’t change from fossil fuels to renewable energy, we will not meet the Paris Agreement ambitions and millions of families will be left behind in poverty. We need to be honest and recognize that the current approach is not delivering the impact the world needs in the time that we have,” said Per Heggenes, CEO of the IKEA Foundation
The independent foundation, funded by the INGKA Foundation, was created by Swedish billionaire Ingvar Kamprad, who founded IKEA.
Rajiv Shah, president of The Rockefeller Foundation, said that after decades of progress, COVID has forced people back into poverty, a problem Shah sees being exasperated by the climate crisis.
“Big, bold, and pioneering collaboration and investment is required not only for the short term, but also the long term, to galvanize a better future. That is why we are announcing our largest commitment to date and joining forces with IKEA Foundation to double that investment. Our partnership will unlock the financing and resources that are essential to provide clean, reliable electricity that improves the lives and livelihoods of people everywhere.”
The Rockefeller Foundation will incubate the platform in RF Catalytic Capital, which the foundation launched in 2020. This allows impact investors and governments to combine their resources.
Separately, retail giant IKEA moved into microgrids in 2020 through a microgrid initiative in South Australia at a store in Adelaide.
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