A just energy transition won’t happen without fixing climate finance

Bangladesh stands at an energy crossroads. Nearly 97% of its energy mix depends on fossil fuels, around 70% of which is imported. In a world shaped by geopolitical instability – from war in West Asia to global price shocks – this dependence is no longer merely an energy issue.

It is a question of economic security, sovereignty and survival.

Recent volatility in the liquefied natural gas market has made this painfully clear. Supply disruptions and price spikes are not abstract risks; they translate directly into fiscal pressure, energy shortages and difficult national trade-offs.

But the deeper crisis is not only about reliance on fossil fuels. It is also about dependence on a global financial system that continues to make a just transition harder, not easier.

For countries such as Bangladesh, the barrier is not ambition. It is fiscal constraint and unequal access to finance.

We are being asked to transition rapidly while managing rising debt, volatile energy markets and shrinking fiscal space. Climate finance intended to support transformation too often arrives in the form of loans, deepening the very vulnerabilities it is supposed to address.

As many in the Global South have long argued, responsibility is global, but constraints are national.

The problem is not only the scale of finance. It is also its structure. Mechanisms such as the Green Climate Fund and the Loss and Damage Fund are evolving, but they still operate within systems shaped by entrenched power and, too often, patriarchal norms.

In practice, finance continues to favour large, centralised infrastructure projects, often backed by multilateral lenders and corporate actors. These projects can displace communities, erode local livelihoods and concentrate control over energy systems. Meanwhile, decentralised, community-led renewable solutions – many driven by women and local entrepreneurs – remain marginal and underfunded.

The imbalance is stark. Less than 1% of global philanthropic funding supports gender and environmental justice together, while only about 4% of climate-related aid treats gender equality as a core objective.

Gender justice, in other words, remains an afterthought.

The consequences are not abstract. Women in Bangladesh and across the Global South carry a double burden: they are more exposed to displacement, environmental degradation and climate shocks, while also absorbing the costs through unpaid care work, resource collection and lost income.

During climate disasters, these pressures intensify, often alongside heightened risks of gender-based violence. A transition that ignores these realities is not only incomplete. It is unjust.

If we are serious about a just energy transition, incremental reform will not be enough. Bangladesh must also begin a serious national conversation about energy sufficiency, not only energy efficiency.

First, debt must be addressed directly.

Bangladesh and many other low- and middle-income countries are trying to navigate the transition under severe fiscal constraints, now worsened by volatile fossil fuel markets. Debt cancellation and restructuring are not radical demands. They are necessary to unlock investment in renewable energy, social protection and resilience.

Climate finance must also be new and additional, not recycled development aid, and it should be delivered primarily through grants rather than loans.

Second, accountability must replace voluntary pledges.

There is no binding mechanism to hold international actors accountable for continuing to finance fossil fuel expansion, including LNG infrastructure, while simultaneously urging developing countries to decarbonise.

Proposals such as a Fossil Fuel Non-Proliferation Treaty point to a possible way forward. By aligning finance with climate goals and setting clear rules for phasing out fossil fuels, such a framework could begin to correct the imbalance between responsibility and capacity.

Without accountability, cooperation risks remaining rhetorical.

Third, climate finance must be redesigned, not merely expanded.

A feminist approach would shift investment towards decentralised, community-led energy systems, support women and young people as entrepreneurs, and recognise the unpaid labour that sustains households and economies.

This is not about adding a gender lens after the fact. It is about changing who controls resources and who benefits.

Fourth, practical financial instruments must support this shift.

Debt-for-climate swaps can reduce fiscal pressure while linking relief to renewable investment. Blended finance and public guarantees can de-risk small-scale energy projects and attract private capital. Regional cooperation can strengthen local value chains and reduce dependence on volatile global fuel markets.

At the same time, fairer trade and investment frameworks are needed to support technology transfer and ensure that developing countries are not locked out of renewable supply chains.

Finally, transition must be linked to livelihoods and Loss and Damage.

Bangladesh is already living with the impacts of climate change – from floods to cyclones – that disrupt communities and economies. Without adequate Loss and Damage finance, countries are forced to balance recovery with transition, often at significant social cost.

A just transition must include investment in reskilling, social protection and alternative livelihoods so that workers and communities are not left behind.

A just energy transition is not only about replacing fossil fuels with renewables. It is about reshaping power – economic, political and social – and reclaiming energy sovereignty in an increasingly unstable world.

It requires a shift from debt to justice, from exclusion to participation, and from voluntary commitments to binding accountability.

For Bangladesh, that means prioritising decentralised renewable energy, supporting women-led enterprises and reducing exposure to volatile fossil fuel imports.

For the international community, it means recognising that climate action cannot succeed within systems that reproduce inequality.

Without structural change, we are not financing a just transition.

We are financing its delay.