As COP26 approaches, the world’s brightest minds are focused on an urgent goal: achieving zero net carbon dioxide emissions globally. Africa presents decision-makers with a particularly complex enigma.
While the region has made a negligible contribution to the problem, the international community widely expects Africa to respond in much the same way as the rest of the world. Indeed, in order to limit the global average temperature rise to well below 2 Â° C above pre-industrial levels by 2050, it is essential that Africa plays its part.
And yet, with most of the continent not having reaped any of the benefits of carbon-intensive systems experienced elsewhere, African governments face the most difficult challenge of prematurely reducing their countries’ very low energy consumption. ‘around 180 kWh per inhabitant compared to 6,500 kWh in Europe. and 13,000 kWh in the United States.
The Paris Agreement’s provisions on multiple paths with common but differentiated responsibilities recognize that nations that have gotten richer by burning fossil fuels should cut their emissions faster to allow the poorest to thrive. Africa needs a realistic roadmap that takes a different but effective approach.
While it contributes only 2-3% of greenhouse gas emissions, the continent suffers disproportionately from the impacts of climate change. Four of the 10 worst disasters identified by the World Meteorological Organization in 2021 occurred in Africa. At the same time, with 14% of global forest cover serving as carbon sinks, Africa is also playing a vital role in achieving global net zero.
African countries like Nigeria, Algeria, Angola and Libya are heavily dependent on oil exports for their income. Overall, around 70% of Africa’s exports come from oil, gas and carbon-intensive mining. These sectors account for about half of the continent’s gross domestic product and are an essential component of government revenues.
Meanwhile, the majority of Africa’s population still lacks access to electricity and basic energy for cooking. As a result, Africa depends primarily on fuelwood and charcoal for its energy needs, endangering valuable forest cover.
The desperate irony here is that Africa has the resources in abundance to provide all the energy needed for development. It makes no sense to fail such resources, especially if they can be exploited in a cleaner way.
How to reach net zero
It is of crucial importance that African countries, as well as the rest of the world, take deliberate and realistic steps to stop climate change. A prerequisite is that the transition from fossil fuels to alternative energy sources occurs in a way that will not punish the region’s struggling economies and create more poverty.
A sudden global divestment from this sector would have catastrophic impacts on development. Many African countries – especially large oil producers – while recognizing the need to shift to a low-carbon economy, have no way of moving away from fossil fuels altogether.
Rather than cutting off existing energy sources, the sustainable way forward is to add alternative energies to take a growing share of the power supply by 2050.
Renewable energy is the ultimate goal. It depends on adequate funding to sufficiently stimulate renewable supplies. There is also the matter of base loads to consider: the sun does not always shine and the wind does not always blow. Ensuring a reliable source of energy will require a blend of certain fossil fuels, although dependence is reduced over time.
Tapping natural gas reserves is essential as a transitional source of cleaner fuel. Africa has abundant reserves of natural gas which can be accessed at relatively low cost. Natural gas can provide a more sustainable and less expensive alternative cooking fuel for millions of people, thereby supporting the conservation of the continent’s forest cover, which plays a vital carbon-absorbing role for global mitigation.
In some oil-producing countries, such as Nigeria, the exploitation of natural gas is also essential to reduce dangerous emissions such as methane from unburned parts of flares. Despite a 70% drop over the past two decades, according to the International Energy Agency, gas flaring by fossil fuel companies remains responsible for more emissions than transport or electricity combined. used by 200 million Nigerians.
Reaching net zero takes more than cleaner energy. Much depends on eliminating unnecessary shipping and where the manufacturing is located. African raw materials are typically shipped to Asian manufacturers and then sent to European markets where they are consumed as finished products. It wastes huge amounts of energy.
An important solution lies in increasing manufacturing capacities, with production facilities as close as possible to raw materials.
Take a look at the success of the ARISE integrated industrial parks in Gabon, Togo and the construction underway in Benin, funded with $ 290 million from AFC.
In collaboration with Olam and the government of Gabon, the Nkok industrial park in Gabon has been certified as the first carbon neutral region in Africa and arguably worldwide by SociÃ©tÃ© GÃ©nÃ©rale de Surveillance, the Swiss multinational certification company, demonstrating the capacity for climate-sensitive development. given the right mix of responsible partners and sufficient funding.
The project transformed Gabon’s exports of raw timber into high-value finished veneer and furniture by adopting a joint development approach, combining trade incentives with a port, roads and other physical infrastructure.
Too many roads, buildings and other infrastructure in Africa are poorly constructed and highly vulnerable to climate change. Basic physical infrastructure is needed to connect, power and industrialize the continent so that Africans can capture a fairer share of the value of our resources.
The final piece of the climate transition puzzle lies in the mobilization of significant national and international financial flows.
Development finance institutions and private capital have a key role to play in creating innovative investment vehicles and deploying catalytic blended finance models to reduce the risks of climate investments and increase the supply of bankable projects.
The surge in demand for green bonds and ESG-friendly investments shows that it is possible to unlock trillions of dollars held by sovereign wealth funds, pension funds, insurance companies and other institutional investors.
Yet at the same time, Africa risks being left out of the evolving global financial architecture, which is being reshaped around the emissions targets of richer countries. AFC is one of the few institutions in Africa to issue green bonds, with the continent accounting for less than half a percent of the amount issued globally, according to data from the Stockholm Sustainable Finance Center.
As policymakers and leaders at COP26 grapple with the multiple challenges of global net zero, the mandate for Africa is clear. International climate action must not further disadvantage Africa’s development. A victim of circumstances it did not create, the region needs access to creative and affordable financing initiatives from the global community to adapt to the effects of climate change.
At the same time, Africa’s path to net zero is expected to expand energy sources, promote efficient fuel consumption, and reduce unnecessary shipments through localized manufacturing.
Ultimately, with the right policies to support a strong expansion of clean technologies and a sufficient focus on improving energy efficiency, Africa could claim a notable achievement: to become the first continent to achieve a significant level of energy efficiency. economic and industrial growth mainly using cleaner sources of energy.
Samaila Zubairu is the President and CEO of the Africa Finance Corporation.