Bridging Risk and Reality: The Missing Communications Link in Clean Energy Finance

Nishant Saxena & Mayuri Singh

Every few months, the International Energy Agency quietly releases a document that should be making headlines in every boardroom and ministry in the Global South. The Cost of Capital Observatory may sound like another technical dataset, but in reality, it’s a mirror held up to one of the most persistent inequities in the energy transition: the cost of money itself.

The September 2025 update tells a familiar but increasingly urgent story. Financing clean energy in emerging and developing economies (EMDEs) remains far costlier than in advanced economies-often double or triple the rates. Even as global interest rates ease, these countries continue to face punishing borrowing conditions driven by regulatory uncertainty, political risk, and the sheer unpredictability of their macroeconomic environments.

This isn’t just about economics. It’s about perception. And perception, as we both know, is a communications issue as much as it is a financial one.

When Capital Fears What It Doesn’t Understand
In markets from Southeast Asia to Sub-Saharan Africa, investors aren’t just evaluating balance sheets-they’re evaluating narratives. A project can be technically sound and environmentally vital, yet still be deemed “risky” because the story around its policy framework, currency stability, or institutional capacity remains unclear.

That’s where strategic communications comes in-not as an afterthought, but as a form of risk reduction. Effective, transparent storytelling around regulation, reform intent, and institutional reliability can do what no guarantee mechanism can fully achieve: build trust.

The IEA’s Cost of Capital Observatory itself is a communication tool in disguise. Through data transparency, active engagement with financiers, and accessible dashboards, it reframes uncertainty into visibility. The expansion of its 2025 dataset to cover 1,700 projects across more technologies and regions is not just statistical-it’s narrative. It signals that the conversation on cost of capital has entered the mainstream of climate finance diplomacy, right before COP29.

The Strategic Comms Gap in Clean Energy Finance
However, the gap remains glaring. While the IEA, World Bank, and G20 discussions focus on regulatory and financial instruments, what’s often missing is a communication architecture that helps translate these reforms into confidence signals for investors.

For example, EMDE governments can pair regulatory announcements with investor briefings and localized storytelling that humanizes reform progress. Development banks can invest in perception tracking to understand how policies are landing in financial markets. And national clean energy missions can integrate narrative design-building emotional and reputational capital alongside financial capital.

Strategic communications, in this context, is not PR. It’s a tool for de-risking narratives. It’s about shifting the investor conversation from “can this country deliver?” to “how is this country proving it will?”

Three Evidence-Based Communication Tactics to De-Risk Perception
To move from theory to practice, EMDE governments can deploy three proven communication approaches that directly address investor uncertainty and strengthen confidence in clean energy markets.

1. Transparent and Data-Driven Messaging
   Governments should regularly share clear, transparent updates on regulatory reforms, project progress, and financial data using accessible language. Providing timely information through multiple channels (press releases, social media, investor briefings) builds trust and reduces uncertainty about policy reliability. Data transparency tools combined with narrative storytelling help transform complex data into visible signals of stability and commitment.
2. Targeted Stakeholder Engagement and Participatory Communication
   Segmenting audiences-such as financiers, local communities, and policymakers-and tailoring messages for each helps address specific concerns effectively. Holding interactive dialogues, consultation meetings, and investor forums creates two-way communication, allowing governments to gather feedback, address doubts, and build a shared understanding of reform intentions and risks. Such engagement strengthens credibility and investor confidence through sustained relationship-building.
3. Leveraging Evidence-Based Narrative Design
   Applying strategic narrative techniques-focusing on transparent storytelling about policy intent, risks, and mitigation measures-can shift investor perceptions from risk aversion to trust. This includes emphasizing institutional capacity, reform successes, and the long-term vision for clean energy. Framing the conversation in a way that connects financial logic with emotional and reputational capital helps de-risk investments through improved perception.

These tactics, rooted in government communication best practices and research on evidence-based policy communication, can help EMDEs bridge the perception gap critical to lowering capital costs and accelerating clean energy investment.

The Way Forward
The IEA’s roadmap, commissioned under Brazil’s G20 presidency, now prioritizes regulatory reform, blended finance, and guarantees. But the next frontier must be communicative reform-creating a common language that links policy intent, financial logic, and investor confidence.

This requires collaboration across government, finance, and communication specialists who can design visibility strategies for credibility: data storytelling, transparent disclosure, and active reputation management. Without these, capital will continue to flow where the narrative feels safer, not necessarily where the climate impact is greatest.

As communicators working at the intersection of policy and perception, we see the IEA’s update as both a diagnosis and a call to action. To lower the cost of capital, emerging economies must not only manage risk but also explain reliability. Because in the energy transition, credibility compounds faster than interest rates ever can.