This report on financing clean energy investments in Africa was requested by the Italian presidency of the Group of Seven (G7) to support the presidency’s new Energy for Growth in Africa initiative. This initiative builds upon existing G7 efforts to promote energy and climate investment in Africa and seeks to develop bankable clean energy projects, attract public and private capital, encourage concessional finance, and overcome investment barriers across Africa.
This report aims to inform the G7 initiative by providing an overview of the energy-related investments needed to achieve all African energy and climate-related goals, including universal energy access and its nationally determined contributions, by 2030. It then explores how clean energy projects can best be financed, focusing on three key investment pillars: household access to modern energy; the electricity sector; and emerging industries.
Finally, it identifies the main types of initiatives needed to develop human and institutional skills and capabilities across Africa, without which the financing of clean energy will remain a challenge in many countries. With energy vital to Africa’s long-term prosperity and the need for investment in clean energy technologies in Africa never being more urgent, this report comes at a critical time and lays the foundations for coordinated financing efforts between governments of African countries and developed nations, international financial institutions, and development organisations.
- Published in
- France
Table of Contents
- Clean energy investment for development in Africa 3
- Abstract 3
- Acknowledgements, contributors and credits 4
- Table of contents 5
- Executive summary 6
- Introduction 10
- Chapter 1. The outlook 12
- The Sustainable Africa Scenario 12
- Energy and investment trends 12
- Sources of finance 15
- Hurdles to ramping up clean energy investment 17
- Chapter 2. Access to energy 20
- Key targets and investment needs 20
- Financing vehicles and instruments 22
- Chapter 3. The electricity sector 26
- Key targets and investment needs 26
- Financing vehicles and instruments 28
- Utility-scale renewable power projects 29
- Distributed renewable power for businesses 31
- Grids and storage 32
- Chapter 4. Emerging industries 34
- Key targets and investment needs 34
- Critical minerals 34
- Steel and cement 36
- Low-emissions hydrogen 38
- Clean technologies manufacturing 39
- Productive activities 40
- Financing vehicles and mechanisms 41
- Chapter 5. Mobilising investment 43
- Creating a conducive investment ecosystem 43
- Better leveraging public funds to attract private capital 44
- Concessional and blended finance 44
- Innovative financial instruments 48
- Integrating cross-cutting developmental objectives 52
- Creating jobs and local value chains 52
- Making transitions just and inclusive 53
- Prioritising energy efficiency 54
- Required capacity-building initiatives 55
- Annexes 58
- Annex A – Abbreviations and acronyms 58
- Annex B – Units of measure 60
