African countries can greatly expand access to affordable electricity, create millions of jobs and future-proof their economies by scaling up investments in renewable energy, Columbia Centre on Sustainable Investment (CCSI) at Columbia University has said.
In a report released yesterday, the centre laid out a roadmap to achieving these goals and described the economic risks of instead pursuing fossil fuel–based economic development.
Last week, the International Energy Agency’s (IEA) World Energy Outlook 2022, anticipated that fossil fuel demand would soon peak and subsequently fall, and confirmed that the energy crisis triggered by Russia’s invasion of Ukraine had consolidated the global shift toward renewables, energy efficiency, and electrification.
“The just energy transition offers significant economic opportunities for Africans,” said Perrine Toledano, CCSI’s Director of Research and Policy. “The gains would be transformative, and the economic consequences of failing to meet this moment would be dire.”
To mitigate climate change, all global economies need to rapidly decarbonize. But African countries bear almost no responsibility for the global climate crisis, and most are still struggling to achieve broad economic prosperity. The continent also needs to finance a vast increase in energy production and use. In this context, many African governments understandably reject the notion that they have any global responsibility to deny themselves the economic benefits of new fossil fuel investments.
This heated debate about Africa’s moral responsibilities might be beside the point. CCSI’s analysis concludes that there is a clear, self-interested case for African economies to invest heavily in zero-carbon energy.
CCSI argued that Africa can leapfrog to zero-emissions sustainable development. In doing so, Africa can avoid locking itself into the declining fossil fuel–based economy while taking advantage of the growing bankable opportunities presented by the zero-carbon energy transition. The continent has rich endowments of renewable energy, including hydropower, solar, wind, and geothermal, as well as natural resources, such as minerals that are critical for the energy and digitalization transformations.
The CCSI report described how African governments can mobilise to realise this opportunity.
It made an empirical case for a range of steps that include the following:
To build infrastructure and achieve key Sustainable Development Goals, African governments should frontload investment in three key areas: zero-carbon electrification, digital access, and education. They should aim to develop productive capacity at all points in the renewable energy supply chain.
African governments and development partners should make annual investments roughly equivalent to two percent of the continent’s Gross Domestic Product (GDP) in renewable power generation, transmission, and distribution. These investments will pay for themselves if financing is shifted away from the high-interest, short-term debt that has mired the continent in regular liquidity and economic crises.
The international community should dramatically increase the capacity of African governments, the African Development Bank, and other African banks to borrow heavily, at long-term concessional rates.
The African Union (AU) and the African Development Bank (AfDB) should undertake a range of key strategic planning tasks, and convene a high-level international advisory group to facilitate a coordinated policy approach.
The CCSI’s “Roadmap to Zero-Carbon Electrification of Africa by 2050” was commissioned by the African Development Bank’s African Natural Resources Management and Investment Centre.
The report makes a total of 20 strategic recommendations and lays out an empirical case for their adoption. CCSI hopes that these will contribute to the conversation at the upcoming United Nations COP 27 climate conference in Sharm El Sheikh.
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