Norway has taken a pioneering step to accelerate the global energy transition by launching the first-ever call for applications for state-backed guarantees aimed at renewable energy projects in developing countries. For the first time, institutions and companies will be able to apply for Norwegian state guarantees for investments in these regions.  4q711a

The Norwegian Agency for Development Cooperation (Norad) has opened the application process for guarantees totaling up to 1.75 billion Norwegian kroner (approximately 150 million euros) in its initial phase. The objective is to mobilize private investments and reduce risks in emerging markets. 

The target groups include professional institutions specializing in issuing guarantees, which can then reallocate them to smaller projects and actors. Companies with large-scale individual projects may also apply. Both Norwegian and international entities will compete on equal . 

This guarantee scheme is part of a broader plan with a total budget of 5 billion Norwegian kroner (approximately 425 million euros) and a five-year trial period. According to Bård Vegar Solhjell, Norad's Director General, "Experience from similar programs indicates that this mechanism could mobilize up to 15 billion Norwegian kroner in investments." 

According to Norad, the program is designed to both multilateral banks and private companies with significant projects. Prioritized initiatives include those that reduce emissions, promote access to clean energy, and contribute to poverty alleviation, particularly in low- and middle-income countries. 

International Development Minister Anne Beathe Kristiansen Tvinnereim emphasized that, "The guarantee scheme is an entirely new way of thinking about aid. Norway has the highest available credit rating: triple-A (AAA). We will use it to guarantee renewable projects to give more private-sector companies and institutions the confidence to invest in challenging markets. 

In addition to making a vital contribution to the green transition in developing countries and reducing greenhouse gas emissions, these projects create jobs, which we know are crucial for reducing poverty." 

Details of the call for applications 

The call is open to both Norwegian and international institutions and companies that meet the criteria. Priority will be given to institutions specializing in guarantees, banks, and significant individual projects. The system requires a minimum indicative amount of 200 million Norwegian kroner (approximately 17 million euros) per guarantee, with the Norwegian state assuming a maximum of 50% of the shared risk. Additionally, up to 30% of the budget will be allocated to projects in low-income countries. 

Incentives for the private sector 

The program seeks to encourage the private sector to seize this opportunity to fund profitable projects that would otherwise not materialize due to perceived high risks. The guarantees, backed by Norway’s AAA credit rating, reduce capital costs and boost investor confidence.