From demonstration to system transformation: What 18 years of evidence from the Clean Technology Fund tells us about transformational Climate Finance

As the costs of renewable energy technologies continue to fall, climate finance institutions face a growing challenge: how can scarce concessional resources continue to catalyse transformational climate action? This evaluation report presents findings from an independent evaluation of the Clean Technology Fund (CTF), the largest programme of the Climate Investment Funds, drawing on evidence from 18 years of implementation, 192 projects, and US$6.9 billion of approved financing across renewable energy, energy efficiency, transport, energy storage, coal transition and industrial decarbonisation.

The evaluation applies a theory-based mixed-methods approach, combining portfolio-level quantitative analysis with country case studies, project-level assessments, stakeholder interviews and document review. Analysis is structured around OECD-DAC evaluation criteria, with gender equality and social inclusion (GESI) considered throughout, and evidence assessed against the Climate Investment Funds' five dimensions of transformational change: relevance, systemic change, speed, scale and adaptive sustainability.

Our findings identify the value of climate finance as a catalyst for change within wider political, institutional and market systems. Across multiple contexts, the CTF has contributed most strongly by reducing investment risks, mobilising additional finance, demonstrating the viability of low-carbon technologies, strengthening institutional capacity, and increasing government ambition for energy transition. The evaluation finds that transformational outcomes were most likely where concessional finance was aligned with supportive policy environments and institutional capacity, while deeper systemic change remained constrained where policy implementation, governance arrangements, or stakeholder participation were weak.

Drawing on evidence from mature and emerging CTF programmes the evaluation identifies implications for the next generation of climate finance, particularly in areas where concessionality remains critical, including energy storage, renewable energy integration, industrial decarbonisation and coal transition. By linking evidence from a large-scale climate finance portfolio to a systematic transformational change framework, this evaluation contributes practical lessons for climate funds, multilateral development banks and policymakers seeking to maximise the effectiveness and additionality of climate finance in accelerating the clean energy transition.