The German government has pledged to contribute €100 million to the African Development Bank’s Sustainable Energy Fund for Africa (SEFA), affirming its commitment to efforts to tap Africa’s renewable energy potential and drive its transition to clean energy sources.
The announcement came during the United Nations High-Level Dialogue on Energy, held in New York on 24 September as part of the UN General Assembly.
The funding will go to unlock private sector investment in green-baseload projects, a SEFA priority focus.
Specifically, it will support technical assistance and investment in power generation, transmission and distribution to increase penetration of renewable power in African grids. The funding follows Germany’s initial contribution to SEFA of €50 million, made in 2020.
During the High-Level Dialogue, in New York Norbert Barthle, Parliamentary State Secretary of the German Ministry for Economic Cooperation and Development highlighted the need to increase global energy transition.
“We need to accelerate the global energy transition. This requires the rapid phasing out of all fossil fuels and a massive expansion of renewable energy. The time to act is now,”Barthle said.
The financing aligns with the G20 Compact with Africa launched during Germany’s tenure of the G20 Presidency.
The Compact promotes macroeconomic, business and financing reform to attract more private investment in Africa.
The Bank’s Acting Director for Renewable Energy and Energy Efficiency, Daniel Schroth, said Germany’s new contribution is a major boost towards SEFA’s capitalization target of $500 million.
“It is also recognition of the catalytic role SEFA has been playing in accelerating Africa’s energy transition and supporting clean energy access solutions,”Schroth said.
SEFA is a multi-donor special fund that aims to unlock private sector investments that contribute to universal access to affordable, reliable, sustainable, and modern energy services for all in Africa, in line with the Bank’s New Deal on Energy for Africa strategy and Sustainable Development Goal 7.
According to the United Nations the environment provides a series of renewable and non-renewable energy sources such as solar, wind, hydropower, geothermal, biofuels, natural gas, coal, petroleum, uranium.
Increased use of fossil fuels without actions to mitigate greenhouse gases will have global climate change implications. Energy efficiency and increased use of renewables contribute to climate change mitigation and disaster risk reduction.