March 7, 2024

Scaling Up Renewable Energy Solutions In Africa Policy Proposals For Development Finance Institutions

Africa’s energy production and consumption reflects the unsustainable use of its wellendowed hydrocarbon resources, manifesting in profoundly unequal access and grossly uneven socio-economic economic outcomes. Beset by considerable energy deficits and structural challenges, including inadequate capacity of power utilities, the energy markets in numerous African countries are fragmented and unsustainable. While some progress had been made in the last decade, investment in energy transition across Africa remains low, accounting for only 2% of global investments in renewable energy in the last two decades. Given that many African countries have limited fiscal space and weak capital markets to address its numerous challenges – at the current rate of investment (foreign and domestic) – it is unlikely that Africa will achieve the Agenda 30 Sustainable Development Goals (SDG) and its decarbonisation targets. Meeting the ambitious targets for Africa’s decarbonisation and sustainable development will require an equally ambitious plan to tackle these twin energy challenges. Importantly, a comprehensive strategy to finance its growing energy requirements and energy transition is imperative – one that includes financial mobilisation from multiple sources and innovative instruments.

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