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Our flagship initiatives

Derisking Renewable Energy Investments Framework

Derisking Renewable Energy Investment (DREI) introduces an innovative, quantitative framework to assist policymakers in developing countries to cost-effectively promote and scale-up private sector investment in renewable energy. 

The DREI framework systematically identifies the barriers and associated risks which can hold back private sector investment in renewable energy. It then assists policymakers to put in place packages of targeted public interventions to address these risks. Each public intervention acts in one of three ways: either reducing, transferring or compensating for risk. The overall aim is to cost-effectively achieve a risk-return profile that catalyses private sector investment at scale.  The end result is reliable, clean and affordable energy solutions in developing countries. 

The DREI framework consists of a suite of publicly-available methodologies, financial tools/models and resources. Current renewable energy sectors covered by the DREI framework are (i) utility-scale, (ii) on-grid rooftop PV, (iii) off-grid mini-grids, and (iv) solar home systems. 

The DREI framework periodically publishes key reports, summarizing important developments in the framework. 

DREI Global Reports

The original DREI Report (2013)

The DREI framework was launched in 2013 with the publication of the original DREI report and financial tool, focused on utility-scale renewable energy. This feature report establishes the methodology’s theory of change, identifying the need to reduce the high financing costs for renewable energy in developing countries as a key task for policymakers acting today. The report describes in detail the various steps and concepts behind the methodology.

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DREI: Off-Grid Electrification (2018)

This feature report expands the DREI framework to solar PV-battery mini-grids for off-grid electrification. The report sets out a theory of change, key concepts and methodological steps, and includes two illustrative case studies in Uttar Pradesh (India) and Kenya. This report has been officially developed in partnership with ETH Zurich.

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DREI Country Applications

DREI Resources and Tools

UNDP, collaborating with its partners, is continually further developing and refining the DREI framework. The following resources and materials are currently available: 

Featured DREI country applications

DREI Kazakhstan

UNDP is working with the Government of Kazakhstan in the implementation of the Global Environment Facility (GEF) financed project “Derisking Renewable Energy Investment” (2017-2022), targeting both utility-scale and small-scale renewable energy investments.

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DREI Belarus

UNDP is working with the Government of Belarus to implement a five-year Global Environment Facility (GEF) financed Project “Removing Barriers to Wind Power Development in Belarus” (2015-2020).

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DREI Cambodia

Cambodia’s Derisking Renewable Energy Investment (DREI) focuses on solar energy across four sub-sectors; utility scale solar, rooftop PV solar, solar battery mini-grids and solar home systems.

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DREI Lebanon

UNDP is working with the Government of Lebanon to support the country’s security of supply of energy by means of low-carbon technologies.

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DREI Tunisia

UNDP is assisting the Government of Tunisia with a Global Environment Facility funded project to support the development of a Nationally Appropriate Mitigation Action (NAMA) for the Tunisia Solar Plan.

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Resources and tools
Derisking tables

Derisking tables can assist policymakers to systematically identify and target investment risks in a particular technology sector. Each derisking table sets out a structured taxonomy of investment risks, underlying barriers, related stakeholder groups, and matching policy derisking and financial derisking instruments.

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Resources and tools
Levelised cost financial models

DREI’s levelised cost financial models are user-friendly, automated Excel tools that calculate life-cycle per unit costs for private sector energy investments, in a particular technology sector. The user inputs a number of key input assumptions, and then the tool automatically generates various outputs.

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Resources and tools
‘Side-by-side’ charts

DREI’s side-by-side charts compare the disaggregated levelised costs of renewable energy vs. conventional energy investments, in a high-cost and low-cost financing cost environment. The charts demonstrate how renewable energy investments are penalized in relation to convention energy in high-cost financing environments, due to renewable energy’s high capital intensity.

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Resources and tools
Case study exercise

UNDP has developed a case study exercise using the Derisking Renewable Energy Investment (DREI) framework. The case study can be a helpful way to be introduced to the concepts behind the DREI framework, and to gain a practical understanding of the financial tool. The case study exercise is centered around a fictional developing country, “Country X”, that is seeking to promote 500MW of private sector investment in onshore wind energy. The case study exercise demonstrates how the DREI financial tool can model Country X’s baseline energy costs, and then compares the cost effectiveness of two different sets of public measures to catalyse the wind energy investment.

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