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IKEA Foundation backs emerging market EV push with $100 million grant
Global Banking & Finance Review®
Company
By Simon Jessop and Virginia Furness
LONDON (Reuters) – A global initiative to accelerate electric vehicle uptake has received a $100 million funding boost from the IKEA Foundation to help developing countries bypass gasoline-driven vehicles and go straight to the greener alternative.
The Drive Electric Campaign, whose charitable investors also include the European Climate Foundation, said the IKEA Foundation’s latest funding donation would be used to help support lobbying efforts and campaign for the EV transition in Africa, Latin America and Southeast Asia under an initiative to be called the “Leapfrogging Partnership”.
The world’s emerging economies are set to account for the bulk of growth in demand for cars, trucks, buses and two- or three-wheeled vehicles by 2050, and the hope is that investing in the countries now can help ensure the growth is all electric.
“Road transportation accounts for roughly 15% of energy related greenhouse gas emissions so if we are serious about a global transition towards 1.5 degrees of global warming then we cannot reduce emissions without it,” IKEA Foundation’s portfolio manager for the real economy, Edgar van de Brug, told Reuters.
The grant, one of the IKEA Foundation’s largest ever charitable donations, will support local partners working to tackle key barriers to expansion like limited charging infrastructure and a lack of EV-friendly policies, as they seek to create better market conditions to unlock public and private finance, he added.
Collectively, the grant could help save around 43 gigatons of carbon dioxide equivalent (CO2e) by 2050 in countries including Brazil, Mexico, Indonesia and South Africa, Drive Electric Campaign said.
The expansion of the funding follows success in other countries including India, where the electrification of last-mile delivery for parcels in urban areas was “taking off at a massive scale”, van de Brug said.
In addition to reducing greenhouse gas emissions and improving clean air, EVs can also benefit the wider economy by accelerating battery development, driving down costs and improving storage capacity, van de Brug said.
“Electrification of road transportation is one of the super leverage points… that could help reduce emissions in more than 10 sectors of our economy,” he said.
Drive Electric Program Director Rebecca Fisher said the broader societal benefits of moving to electric were also marked.
“We know that communities are already experiencing the benefits of e-mobility, from delivery drivers saving money on fuel to public transit workers breathing cleaner air… Now is the time to supercharge the momentum of EV innovation with ambitious public policy, business leadership, and strong partnerships.”
(Reporting by Simon Jessop; Editing by Susan Fenton)
The Drive Electric Campaign is a global initiative aimed at accelerating the adoption of electric vehicles (EVs) in emerging markets, supported by various charitable investors including the IKEA Foundation.
Electric vehicles (EVs) are automobiles that are powered by electricity instead of gasoline or diesel, contributing to reduced greenhouse gas emissions and promoting cleaner air.
The IKEA Foundation is a charitable organization that supports various initiatives aimed at improving lives and promoting sustainable development, including funding for electric vehicle projects.
Climate change refers to significant changes in global temperatures and weather patterns over time, primarily driven by human activities such as burning fossil fuels and deforestation.
Sustainability is the practice of meeting current needs without compromising the ability of future generations to meet their own needs, often focusing on environmental conservation and responsible resource use.
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