The International Renewable Energy Agency (Irena) urges African policymakers to use their limited public resources strategically, and alongside policy and regulatory instruments, to unlock the $ 105 billion required each year to install the 1,026 GW of renewable energy needed by 2050 to meet the growing demand for electricity on the continent.
Speaking at the Virtual Africa Energy Indaba on Monday, the Managing Director Francesco The Camera underlined the disproportionate role of public finances in the renewable energy sector in Africa.
While public finances, on average, provided 14% of total investments for renewable energy projects between 2013 and 2018, the share of public funds in renewable energy investments in sub-Saharan Africa stood at 34%.
The continent was also lagging behind in its renewable energy deployment, adding less than 2 GW in 2019, which was the lowest growth rate in seven years and accounted for less than 2% of global capacity additions this year – the.
“This indicates the need for increased private sector involvement,” he said, adding that the role of the private sector had also been accentuated by the Covid-19 pandemic, which had strained public resources .
“Therefore, we need to make sure that public resources are used strategically, to enable private financing.
“Investments should be geared towards higher risk tolerance and towards new instruments such as green bonds, blended finance and tailor-made financial and risk mitigation instruments.
“Governments and public financial institutions can play a central role in this regard by providing policy and regulatory solutions. “
The intergovernmental agency itself had set up a Climate Investment Platform to facilitate the creation of a pipeline of bankable projects.
“So far in Africa, 97 projects worth over $ 38 billion have been registered and 198 private and public partners have expressed interest in collaborating in this region,” reported La Camera.
From a resource perspective, the continent was in a strong position, with Irena estimating that Africa’s potential to generate renewable energy from existing technologies was 1,000 times greater than the continent’s projected electricity demand. in 2040.
“By harnessing these renewable energy sources, Africa can move towards a sustainable and secure energy future, a future that promotes resilience and equality and protects both livelihoods and the environment.
The Camera also highlighted the job potential of a large-scale deployment of renewable energy, noting that there are already 11.5 million jobs in the sector globally, with 25 jobs created for every 1 million. of dollars invested.