BusinessDay

Energy access: 4 common positions for Africa Bloc to consider in COP27

According to the African Development Bank (AfDB), over 640 million Africans, representing 40 percent, have no access to energy. The World Bank reports that only about 42 percent of the West African population has access to electricity, making the region with the lowest rates of electricity access in the world. With less than 40 days (Nov. 6-18, 2022) to the Conference of Parties (COP)27 in Sharm El-Sheikh in Egypt, Africa Bloc should have one voice on these issues while they negotiate: financial assistance for energy projects; clean energy investment; bio-energy expansion, and gas as a transitioning fuel.

Financial assistance for energy projects

One of the international financial flows to developing countries is clean energy development assistance. At COP15 in Copenhagen, developed countries pledge to mobilise $100 billion in public and private funds annually for climate adaptation and renewable energies in less developed countries before 2020. However, the target was missed. But at COP26 in Glasgow, they adjusted the window period to 2025.

In 2019, “Nigeria, Guinea, and India were the top receiving countries in support of clean energy through international public financial flows.” The question is, how is this fund being utilised? The African Bloc should explain to the world how the financial support received has been helping or will help the continent in solving its energy poverty. Energy poverty cripples’ development prospects. For example, the rise in diesel prices, unstable electricity tariffs, and irregular power supply in Nigeria have affected businesses. These are taking a toll on operating expenses, and making some commercial banks reduce hours of operations.

African Bloc should also prepare to present or project social or economic returns on investments. As this will motivate funders’ nations or agencies to further provide financial aid and climate finance. It will also help the continent to self-finance its climate investment through Debt-For-Climate (DFC) Swap as propounded by Vice President of Nigeria, Yemi Osinbajo. DFC is a proposed deal in which ‘’bilateral or multilateral debt is forgiven by creditor country or institution in exchange for a commitment by the debtor country to use the outstanding debt service payments for national climate action programmes.’’

Clean energy investment

Unlocking the potential of renewable energy sources in Africa is imperative to the continent’s energy security. According to the AfDB, Africa has almost unlimited potential for solar capacity (10 terawatts), abundant hydro (350 gigawatts), wind (110 gigawatts), and geothermal energy sources (15 gigawatts) as these could put the continent at the forefront of renewable energy generation in 2030, the International Renewable Energy Agency (IRENA) estimates. Unfortunately, the continent’s weak investment policies on renewable energy have reduced countries’ ability to tap into this potential.

As COP27 is around the corner, African leaders should also make national policies to catalytic finance, which will unlock renewable energy potential and attract investments in the country. Recently, President Joe Biden signed the Inflation Reduction Act, a climate bill that centred on energy security and climate investments. One takeaway from the bill to Africa Bloc is the tax breaks and incentives including bonus credits for businesses to promote the use of American-made equipment for clean energy production, electrification, and green technology.

Bio-energy expansion

Access to energy plays a key role in economic development and technological advancement. However, most energy consumed within Africa is generated from solid biomass. This dependence increases deforestation in most countries despite its sufficient resources to transition into renewable energy which is highly sustainable and kills the harmful emission from greenhouses which contribute seriously to climate change and adverse health implications for people.

Technological advancement has proven that biomass, the primary source of energy for people within the region, can be converted into high-energy fuels such as biofuel, biogas, and many more that can provide electricity, heat, and transportation fuel which in turn would replace fossil fuels. It has also been found that landfills for municipal solid waste are a source of biogas.

Lynd and Woods said that this process contributes to employment; development of marketable and transferable skills for the rural population; introduction of agricultural infrastructure and know-how; improved balance of payments and currency valuation; energy democratization, self-sufficiency, and availability of agricultural machinery and processing; and an economically rewarding way to regenerate Africa’s vast areas of degraded land.

In Africa, both the rural and urban areas highly depend on biomass as the main source of energy with over 80 percent of the total energy supplied is used for heating, cooking, and processing of agricultural produce which is derived from biomass, such as fuel wood and agricultural residues. The use of biomass has contributed to deforestation, land degradation, and desertification on the continent.

How then does the continent transition? Africa is rich with energy resources but transforming them into a renewable and sustainable one still remains a major problem. First, the continent would need to develop bioenergy injuries that are economically capable to meet the demands of the people. In doing this, countries would have to create an institutional framework where policies can be synergised. This framework includes regulations from the government as well as support from private organisations and non-governmental organisations.

Read also: Nigeria to become largest renewable energy employer in Africa

Gas as a transitioning fuel

African leaders have been at loggerheads in coming to a conclusion on whether to use gas as a transition fuel or not. The use of natural gas means that high-content fossil fuels such as coal and oil will be divested and phased out while investing in natural gas to generate electricity, cook, and fuel transportation vehicles.

These indecisions by African leaders or stakeholders are tied to the belief that transition would collapse several countries’ economic systems. While there are visible implications for climate change, the leaders are alternatively pushing for using fossil fuels to develop their own economy. Early this year, European Union labelled gas (from fossil fuel) as green to replace dirty fuel temporarily until 2030 if they meet criteria including emissions limits, and a requirement to progressively burn more low-carbon gases, starting in 2026 and eventually switching to 100 percent low-carbon gas in 2035, Kate Abnett and Sabine Siebold, report for Reuters.

Recall that in June, an African Union Technical Committee and energy ministers from across the continent proposed an “African Common Position on Energy Access and Transition” intended to be adopted at COP27 stating the interest of leaders to use gas as a transition fuel to clean energy.

On the contrary, the war between Russia into Ukraine has affected the global price of gas. For countries in Africa with little or no industrial structure in place, transitioning might cost more considering the economic viability of these countries.

However, it is clear that African countries need to invest in renewable energy to reduce the impact of climate change and health complications in their countries. There is also a need to reduce the dependency on fossil fuels as the primary option for energy generation. While the cost of building a gas terminal might be a challenge for underdeveloped countries, its benefits affect not just the country but the global space at large. Recently in Dakar, the US climate envoy, Kerry cautions against long-term gas projects in Africa. Last month, Minister of State for Petroleum Resources in Nigeria, Timipre Sylva, stressed that an attempt to limit international financing of oil & gas projects could jeopardise Africa’s energy transition.

Eme Okang, the director of Standpoint initiative, noted that Africa has to be on the same page in deeply analysing, synthesizing, and proffering long-term and sustainable processes and even alternatives to not just transition but sustain the transition and no African government should take the back burner when it comes to the implementation of any such solutions that would be agreed upon by parties. It is doable with the right prescriptions.

In conclusion, Africa is hosting the annual COP27 in the next few weeks. This can be a good opportunity to advocate clean energy finance, investment, and solutions that better fit into the economic, political, and developmental structures of the continent. The effect of climate change is crumbling several countries’ development and a unified standpoint can help these countries’ sustainability.

Ogunnigbo, environmental consultant, writes on climate and Environment, & Ogunyale, freelance investigative – data and climate journalist

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