Opportunities for U.S.-China engagement on development finance for overseas renewable energy

A dramatic scaling of renewable energy is needed to achieve global climate goals. In this paper, we systematically present the potential set of opportunities that exist for the United States and China to engage on overseas renewable energy development finance. We find that there is substantial complementarity in the institutions and instruments that the U.S. and China have deployed to promote development finance overseas. Given their relative specializations, we find that there is a potential opportunity for further U.S.-China coordination and cooperation on overseas renewable energy. In combining our assessment of initiatives that would have the most impact and yet also be viable in terms of the level of coordination that is feasible under current conditions, we recommend a focus on the following areas for expanding U.S.-China engagement on renewable energy development finance: 1) joint project finance; 2) joint capacity building efforts and 3) parallel bilateral investment principles and standards. These three areas pose a significant potential for accelerating the renewable energy transition by increasing financing opportunities in the Global South and are areas where both countries would see a common interest and benefit to expanding cooperation and coordination, even in the current environment.