Roundtable Readout: Mobilizing Catalytic Financing for Clean Energy Infrastructure

On June 18, 2025, the EFI Foundation (EFIF) and the Atlantic Council co-hosted a private roundtable focused on mobilizing catalytic financing for clean energy assets at the Atlantic Council Global Energy Forum. The roundtable brought together policymakers, investors, solution providers, and subject matter experts to identify the primary barriers slowing capital deployment—and the catalytic mechanisms needed to overcome them. The roundtable was split into two sessions: (1) early stage clean firm power projects in advanced economies, and (2) clean energy infrastructure development in emerging markets.

The roundtable drew on insights from two recent analyses on how to scale up private capital for clean energy and climate investments. One, conducted by the Economist Impact, and supported by EFIF, leveraged a global investor survey to explore how catalytic finance can unlock private investment in advanced energy technologies.

The other, a report by the Atlantic Council, explored strategies to expand private capital flows into clean energy infrastructure and nature-based solutions in emerging markets, particularly through the authors’ proposed loan guarantee facility: the Emerging Market Climate Investment Compact (EMCIC). Major takeaways from the roundtable are summarized below. 

Session I: Catalyzing Investment in Clean Firm Power Projects in Advanced Economies 

Rising demand for clean, reliable electricity is not matched by significant investments in commercial-scale clean firm technologies. Private capital remains largely sidelined because of real or perceived risks, particularly for first-of-a-kind (FOAK) and next-of-a-kind projects. 

Co-moderated by Stephen Comello (EFIF) and Phillip Cornell (Economist Impact), this session explored financial de-risking mechanisms to scale earlier-stage clean firm technologies such as nuclear energy, advanced geothermal, and natural gas with carbon capture and storage (CCS). These projects often face the “missing middle” problem: They are too capital-intensive for venture funding yet too risky for institutional lenders, leaving them with few viable options to raise adequate capital for commercial-scale deployment. Catalytic financing that improves expected risk-adjusted returns for project sponsors can help bridge this gap, motivating private capital for initial deployments. Public-private coordination at the early commercial stage is necessary to lower costs and manage risks, enabling a pipeline of bankable projects that can scale.

Barriers to Capital Deployment for Clean Firm Energy Solutions 

Clean firm projects face multiple risk categories: 

• Technology-specific and execution risks, like unplanned project cost overruns, a lack of cost certainty, and revenue volatility. 

• Market and policy risks, particularly: 
  • Political uncertainty (e.g., wavering tax incentives), which undermines investor confidence. In the U.S., developers have committed substantial capital based on expectations of policy continuity. Roundtable participants questioned whether, given recent reversals of supportive mechanisms, investors would demand a higher risk premium for U.S. projects, requiring higher expected returns to justify investment. 
  • Slow regulatory processes, such as protracted rate cases and permitting delays, which drive up project costs and timelines.  
  • Electricity market designs, particularly in deregulated systems, which do not fully value the attributes of clean firm power, thereby reducing investor appetite. 

Without coherent government intervention to mitigate these risks, participants agreed that investment will remain limited and episodic—often stalling at the development stage or being confined to niche projects. This would be insufficient to establish de-risked, at-scale industries and associated supply chains. 

Pathways to Unlock Capital for Clean Firm Energy Solution Scaling 

To scale clean firm power solutions, investors and policymakers must design mechanisms that manage risk effectively while ensuring that public capital is used strategically to unlock significantly larger volumes of private investment. Support mechanisms addressing these risks—and their design considerations—are outlined below.  

Cost Risk Management 

Investors require certainty that capital-intensive projects will be on time and on budget. This is particularly true for FOAK projects, which lack the data and project management experience necessary to price and reduce these risks. Mechanisms and design considerations to manage costs include: 

• Federal backstops to protect investors from substantial cost overruns—as proposed in the Accelerating Reliable Capacity (ARC) Act—are particularly important for FOAK nuclear projects. These mechanisms should also be designed to ensure developers maintain meaningful skin in the game” (e.g., by requiring developers to cover the first tranche of cost overruns), which would incentivize projects to be completed on time and on budget.  

• De-risking through pilot-scale demonstrations. Supporting smaller-scale projects first can validate technical and financial viability before committing to larger builds. For example, Calpine’s pilot carbon capture project in California—supported by the U.S. Department of Energy—aimed to generate operational data to reduce risks and bolster investor confidence in future, full-scale deployments.ⁱ   

• Successive builds of the same technology enable “learning by doing,” accelerating cost reductions. The United Arab Emirates’ development of four APR-1400 units illustrates how serial deployment increases efficiency. Data from FOAK projects can also boost confidence in next-of-a-kind investments.ⁱⁱ  

Revenue Support  

Long-term revenue certainty is essential for FOAK and early stage commercial projects to reach final investment decision. In many cases, cost premiums for early movers must be absorbed, either by government or in collaboration with private-sector actors. Effective models include: 

• The Clean Transition Tariff, developed by Google and NV Energy, creates an electricity tariff structure that enables large-load customers to voluntarily pay a premium for power from specified clean firm projects, while protecting ratepayers. 

• Germany’s H2Global presents a stable, long-term offtake pathway for hydrogen to eventually be produced at a competitive market price (determined through an auction). The government subsidizes the gap between buyers’ willingness to pay and suppliers’ production costs, thereby de-risking early projects.  

Credit Support 

Improving the credit profile of a project or borrower enables capital providers to lend, invest, or underwrite with greater confidence. Successful models include: 

• Credit insurance, which can transfer counterparty default risk to an insurer. For instance, Energetic Capital provided credit insurance for an offshore wind project with an unrated offtaker, allowing the sponsor to raise additional debt.ⁱⁱⁱ  

• Public credit backstops, which may be needed when private insurance markets are unwilling to cover FOAK risk. DOE’s Loan Programs Office offers such support through its Loan Guarantee Program.^iv 

Cross-cutting Financing and Policy Considerations for Unlocking Private Capital  

Catalytic capital is most effective when paired with targeted de-risking mechanisms that improve project-level risk-adjusted returns and help close the “missing middle.” However, unlocking large-scale private investment in clean firm power requires more than project-level fixes. Persistent structural barriers continue to limit the pace and scale of deployment. Those barriers include risk concentration, high transaction costs, lack of standardized procurement mechanisms, and institutional reluctance to invest in FOAK or emerging market projects. 

To address these challenges, policymakers and capital providers should prioritize the following cross-cutting approaches: 

Investment Design to Spread and Share Risk 

A key barrier to mobilizing private capital is that early clean firm power projects often concentrate risk on a single entity—whether a utility, developer, or investor—making the projects unattractive to commercial players. Effective investment design can mitigate this by spreading risk across multiple actors, aligning incentives, and creating structures that scale. Examples include: 

• Public upside risk-sharing: Public entities can share in project upside to build political support and enable reinvestment. For example, the United Kingdom’s Contracts for Difference (CfD) schemes allow the government to receive payments from developers when market prices exceed the strike price.  

• Blended capital at the portfolio level: Rather than investing project by project, blending public, philanthropic, and private capital across portfolios can diversify risks across technologies, geographies, or business models. Public or philanthropic investors can enhance private-sector returns by taking junior or first-loss positions. For instance, Altérra’s capped-return role in Brookfield’s Catalytic Transition Fund helped attract institutional capital to higher-risk clean energy assets in emerging markets.^v  

Navigating International Financing and Strategic Industrial Policy 

Access to international project-level financing—such as through development banks or export credit agencies—can be critical, especially when domestic financing is constrained. However, national governments must define the terms of engagement: 

• For example, Bulgaria is leveraging financing from the U.S. EXIM Bank to deploy U.S.-designed nuclear reactors. 

• Other countries may prioritize domestic technology development by restricting foreign capital or technology imports through industrial policy and export-import controls.^vi  

Building Enabling Infrastructure 

Clean firm power depends on robust enabling infrastructure, especially grid infrastructure. Two priorities stand out: 

• Accelerated infrastructure siting and permitting: Streamlining planning and permitting across jurisdictions, including standardized regulatory processes, is critical to avoid bottlenecks. 

• Integrated long-term planning: Policymakers must align infrastructure investments with strategic decarbonization and reliability goals. This includes valuing clean firm power for its unique grid services—flexibility, reliability, and capacity adequacy—beyond simple energy output. 

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Session II: Catalyzing Investment in Clean Energy Infrastructure in Emerging Markets and Developing Economies 

In emerging markets and developing economies (EMDEs), capital that could be invested in clean energy infrastructure often remains sidelined because of high perceived risks, policy uncertainty, and investor unfamiliarity with local markets. These environments present challenges distinct from those in advanced economies—including currency risk, regulatory uncertainty, and developing investment ecosystems—which constrain private sector participation.  

Led by the Atlantic Council, this session focused on the barriers to scaling clean energy investment in EMDEs and the catalytic mechanisms that could mitigate risk and accelerate the flow of private capital to a robust pipeline of investable projects. Catalytic mechanisms such as guarantees, first-loss capital, green and sustainability-linked bonds, and blended finance can de-risk investments and help mobilize private capital at the scale required, while structural reforms can boost investor confidence and streamline infrastructure project development. 

Barriers to Deployment 

• Enabling infrastructure is insufficient, not only transmission wires and pipelines, but also ports, roads, manufacturing, and digital infrastructure. 

• Inconsistent or weak regulatory frameworks in some emerging markets raise investor risk, even where clean energy potential is high. However, other emerging markets do have stable legal frameworks (e.g., the Caribbean). 

• Existing de-risking mechanisms are inadequate to meet the scale of the challenge and often are misaligned with investor priorities. 
  • Existing market-based and blended finance tools are fragmented, underfunded, or too slow to deploy to be able to meet the scale of the challenge. 
  • Multilateral development banks (MDBs) often prioritize sovereign lending or internal mandates, not private capital mobilization. MDB reform will not come fast enough to mobilize the private capital needed. 
  • In the current blended finance/direct foreign investment ecosystem, one dollar of public funding mobilizes only half a dollar or less of private capital on average. 

Current funding is insufficient to meet clean energy infrastructure needs. 

• The gap between current and pledged funding by advanced economies—from the current level of $100 billion per year to $300 billion, with a goal of $1.3 trillion per year by 2035, pledged at COP29 in Baku—is too large for developed countries’ governments and MDBs to close on their own. 

• Meanwhile, the International Energy Agency estimates that $1.4 trillion to $1.9 trillion per year is needed for the energy transition in emerging markets and developing economies by the early 2030s. The International Union for Conservation of Nature estimates that $800 billion per year is needed by 2030 for ecosystem and biodiversity protection. 

Pathways to Unlock Capital 

National-level commitment signals credibility to investors and multilaterals. 

• For example, in Morocco, the government created an agency (MASEN) to streamline the development of renewable energy, addressing all roadblocks to clean energy projects (e.g., the structuring, infrastructure development, permitting, and offtake of projects). In addition, MASEN mobilizes funds from international institutions, including multilateral development banks, to ensure the bankability of renewable energy projects.  

Local ecosystem development and domestic learning curves matter. 

• Local hiring, workforce development, and supplier integration are critical for long-term industry-building. 

• Projects relying solely on foreign engineering, procurement, and construction contracts without knowledge transfer will not build the local capacity needed to lower the costs and risks of follow-on projects. 

Innovative financial mechanisms can lower the cost of financing and hasten project development. 

• One proposed financing solution—EMCIC—would create a new global facility with the goal of mobilizing between $100 billion and $500 billion over 10 years using the high leverage rate of guarantees. EMCIC would: 
  • Comprehensively guarantee loans for clean energy infrastructure and investments in nature-based solutions. 
  • Pre-select institutional investors to use guarantees on a portfolio basis using prescribed standards and not duplicate due diligence at the facility level. 
  • Not require host country backup guarantees that EMDE governments often cannot afford because of existing debt but that are required by many lenders including the World Bank Group and many MDBs.