Green Finance and the Energy Transition: A Systematic Review of Economic Instruments for Renewable Energy Deployment in Emerging Economies

Emma Verónica Ramos Farroñán (), Gary Christiam Farfán Chilicaus, Luis Edgardo Cruz Salinas, Liliana Correa Rojas, Lisseth Katherine Chuquitucto Cotrina, Gladys Sandi Licapa-Redolfo, Persi Vera Zelada and Luis Alberto Vera Zelada
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Emma Verónica Ramos Farroñán: Institute for Research in Science and Technology, Campus Chepén-Callao, César Vallejo University, Trujillo 13001, Peru
Gary Christiam Farfán Chilicaus: Institute for Research in Science and Technology, Campus Chepén-Callao, César Vallejo University, Trujillo 13001, Peru
Luis Edgardo Cruz Salinas: Institute for Research in Science and Technology, Campus Chepén-Callao, César Vallejo University, Trujillo 13001, Peru
Liliana Correa Rojas: Institute for Research in Science and Technology, Campus Chepén-Callao, César Vallejo University, Trujillo 13001, Peru
Lisseth Katherine Chuquitucto Cotrina: Institute for Research in Science and Technology, Campus Chepén-Callao, César Vallejo University, Trujillo 13001, Peru
Gladys Sandi Licapa-Redolfo: Department of Chemical and Dynamic Sciences, National University of Cajamarca, Cajamarca 06001, Peru
Persi Vera Zelada: Department of Environmental Sciences, National Autonomous University of Chota, Chota 06120, Peru
Luis Alberto Vera Zelada: Professional School of Mining Engineering, National University of Cajamarca, Cajamarca 06001, Peru

Energies, 2025, vol. 18, issue 17, 1-36

Abstract: This systematic review synthesizes evidence on economic instruments that mobilize renewable-energy investment in emerging economies, analyzing 50 peer-reviewed studies published between 2015 and 2025 under PRISMA 2020. We advance an Institutional Capacity Integration Framework that ties instrument efficacy to regulatory, market, and coordination capabilities. Green bonds have mobilized roughly USD 500 billion yet work only where robust oversight and liquid markets exist, offering limited gains for decentralized access. Direct subsidies cut renewable electricity costs by 30–50% and connect 45 million people across varied contexts, but pose fiscal–sustainability risks. Carbon pricing schemes remain rare given their administrative complexity, while multilateral climate funds show moderate effectiveness (coefficients 0.3–0.8) dependent on national coordination strength. Bibliometric mapping with Bibliometrix reveals three fragmented paradigms—market efficiency, state intervention, and international cooperation—and highlights geographic gaps: sub-Saharan Africa represents just 16% of studies despite acute financing barriers. Sixty-eight percent of articles employ descriptive designs, constraining causal inference and reflecting tensions between SDG 7 (affordable energy) and SDG 13 (climate action). Our framework rejects one-size-fits-all prescriptions, recommending phased, context-aligned pathways that progressively build capacity. Policymakers should tailor instrument mixes to institutional realities, and researchers must prioritize causal methods and underrepresented regions through focused initiatives for equitable global progress.

Keywords: economic instruments; green finance; emerging economies; institutional capacity; green bonds; direct subsidies; carbon pricing; multilateral climate funds; sustainable development goals; sustainable energy transition (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2025
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