Transitioning to clean energy and opportunities for developing countries

Abstract

The shift from fossil-based energy systems to renewable sources like solar, wind, and hydro presents both opportunities and challenges for developing countries aiming to expand energy access, promote economic growth, and meet climate goals. This study examines the technological, financial, institutional, and governance aspects of clean energy transitions, focusing on regional disparities and implications for low- and middle-income economies. A systematic review of literature was carried out using the SPAR-4-SLR methodology across Scopus, Web of Science, and Google Scholar. Only peer-reviewed studies published in English from 2009 to 2025 were included, guided by four research questions: (1) technological and resource endowments, (2) capital structuring and financial market dynamics, (3) institutional and policy frameworks, and (4) decentralized, digital energy governance. Search terms were tailored for each theme, and studies were classified by topic, region, and methodology. Results show that decentralized renewable systems—especially solar micro-grids—offer affordable alternatives to fossil fuels in rural and off-grid areas, enhancing job creation, energy security, and poverty reduction. Examples from Kenya, India, and Southeast Asia highlight the importance of policy consistency, financial innovation, and institutional preparedness in promoting clean energy deployment. Still, ongoing challenges such as high initial costs, infrastructure gaps, and limited technical skills continue to hinder progress in many regions. • Institutional and financial factors outweigh resource availability in clean energy. • Local policy tools often outperform broad international frameworks of clean energy. • Blended finance reduces cost barriers in early-stage clean energy projects. • Inclusive planning links clean energy to health and equity gains. • Technology transfer works best with local training and governance support.