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UAE Pledges $4.5 Billion for Clean Energy in Africa Amidst Rising Climate Crisis

Wednesday, 06 September 2023 04:58
UAE Pledges $4.5 Billion for Clean Energy in Africa Amidst Rising Climate Crisis

(Ecofin Agency) - In 2022, the adverse effects of climate change resulted in economic damages exceeding $8.5 billion in Africa, as reported by the World Meteorological Organization (WMO). The African Climate Summit aims to produce actionable solutions, in a context where decisions taken by world polluters during previous COP meetings had little impact.

The United Arab Emirates (UAE) pledged, on September 5, 2023, investments totaling $4.5 billion in clean energy projects across Africa. Citing the COP28’s designated president, Sultan Al Jaber, local media reported that the commitment was made during the African Climate Summit (ACS), currently held in Nairobi, Kenya.

The initiative, according to Al Jaber, aims to foster "15 GW (gigawatts) of clean energy by 2030" and "catalyze at least an additional $12.5 billion from multilateral, public, and private sources". Partners in this venture include Abu Dhabi's clean energy firm Masdar, the Abu Dhabi Development Fund, Etihad Credit Insurance, renewable energy company AMEA Power, and Africa50, an investment platform set up by African governments and the African Development Bank.

"Priority will be given to investments in African countries with clear transition strategies, enhanced regulatory frameworks, and a master plan for developing integrated supply and demand grid infrastructure," the same source added.

Under its "Etihad 7" program, the UAE also wants to generate 20 gigawatts, providing clean electricity to 100 million people in Africa by 2035.

Though it is a very small polluter, Africa suffers disproportionately from climate change and its effects. The phenomenon severely threatens the continent’s food security, ecosystems, and economies, consequently intensifying displacement and the threat of conflict caused by dwindling resources. According to the World Meteorological Organization (WMO), over 110 million people in Africa were directly affected by weather, climate, and water-related hazards in 2022, leading to the aforementioned economic damages.

The African Climate Summit, scheduled in Kenya from September 4-6, aims to mobilize the funds Africa needs to fight global warming and draw solutions that better match its needs. Together, the Summit’s participants–heads of state and governments, and industry leaders–strive to promote Africa's potential as a clean energy powerhouse.

Despite boasting the world's most significant solar potential and vast wind energy opportunities, Africa's installed renewable energy capacities account for only about 1% of global solar photovoltaic and wind capacities. However, the International Renewable Energy Agency (IRENA) anticipates that by 2040, Africa's renewable energy capacity could surge to over 530 gigawatts, up from around 54 gigawatts in 2020. 

It is worth noting that of the $2.8 trillion that have been invested globally in renewable energies over the past 20 years, only 2% of the funds went to Africa, despite the continent's colossal potential and pressing needs.

Charlène N’dimon (intern)

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ECOFIN AGENCY offers a selection of articles translated from AGENCE ECOFIN. Founded in 2011, Agence Ecofin is a leader in Francophone Pan-African economic news, particularly in West and Central Africa. The agency publishes daily news on nine African economic sectors: Public Management, Finance, ICT, Agribusiness, Energy, Mining, Transport & Logistics, Communication, and Training.

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