Conference brief
Stimulating European commitment for Africa’s RE transition:
A new holistic European initiative to foster renewable energy market development through private investments in Africa
4 June 2019, Rome

 

On 4 June, the renewAfrica initiative was launched during a dedicated event in Rome to promote the creation of a new European program to support renewable energy investments in Africa. The event, titled “Stimulating European commitment for RE development in Africa”, gathered high-level representatives from the European Commission, Italian government, international organizations, renewable energy industry, European financing institutions, academia and think-tanks as well as other partners to endorse and kick-off the initiative.
The event was opened by Antonio Cammisecra, President, and Roberto Vigotti, Secretary General, of RES4Afrca. Romano Prodi, former president of the European Commission and special envoy of the United Nations for Africa, greeted the audience with a dedicated video-message.

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High-level representatives, such as Vera Songwe, Executive Secretary, UNECA; Antonella Baldino, Chief CDP International Development Finance Officer, Cassa Depositi e Prestiti; Anne-Charlotte Bournoville, Head of International Relations & Enlargement, DG Energy, European Commission; and Maria Shaw-Barragan, Director of Global Partner Countries, European Investment Bank, positively welcomed and endorsed the inception of the renewAfrica initiative by ensuring its relevance to scale up renewable energy investments in Africa, underlining their institution’s interest to see the initiative go forward.

 

 

The renewAfrica initiative was presented in detail by Paolo Gentili, Director of PwC.
Europe currently provides a number of instruments, both national and international, to support renewable energy projects in Africa. However, investors still face important challenges when investing in the continent. RES4Africa Foundation in collaboration with PwC carried out preparatory studies merged into the white paper “A New Instrument to Foster Large-Scale Renewable Energy Development and Private Investment in Africa”, to analyze these existing instruments.

The renewAfrica initiative therefore promotes the creation of an innovative European support program, with its own legal framework, to facilitate renewable investments in Africa. The program should build on the strengths of existing programs and fill in remaining gaps in a perspective of synergy and cooperation.

The study found many gaps among the analyzed programs in terms of complete mechanisms of guarantees and insurance, technology neutrality, geographical limitation; furthermore, none of the programs provides support in all the main phases of an investment nor does it sufficiently cover all the major risk areas.

The analysis revealed that of the over 75 programs active today, only 17 provide significant support to investing in Africa such as risk mitigation tools, technical assistance, capacity building; focus on large-scale projects (above 50MW); are of European origin; and do not present geographical limitations within the African continent.

 

 

Africa has a tremendous opportunity to develop its vast RE resources and ensure its resilient, prosperous and sustainable development. The lack of comprehensive supporting programs translates into the lack of investments to ensure an impact. The current electrification rate is insufficient to bring power to the 600 million people in Sub-Saharan Africa who live in the dark, as the positive achievements are counter-balanced by demographic growth, that will make the number of people without access to electricity in 2030 higher than today. In order to have a real impact, Africa’s renewable energy transition needs to be accelerated and investments need to be taken to another level.

It was also stressed that the discourse about Africa should not be one about support, but one of collaboration for mutual improvement. For Africans, access to energy means the opportunity to kick-off or scale up their businesses and achieve sustainable development. For investors, the African continent represents a huge investment opportunity: Africa, the second continent by population, offers a huge potential market, and investments for 170 billion USD in next 12 years is what is needed to bring Africa out of the dark.

Drawing from past experiences and benchmarks, several speakers and participants underlined that renewAfrica should be a pragmatic initiative and Africa’s specific needs need to be taken into consideration. RenewAfrica already outlines a general framework of the new program identifying some salient points such as the facilitation of high-level dialogue between investors, governments and authorities, the existence of financial support and risk mitigation tools, the promotion of capacity building and knowledge transfer activities, and support for the development of an auction process and the standardization of documentation. Finally, the program must create an enabling and attractive environment for investors by providing support throughout all investment phases.

The event ended with the signing of the non-binding Declaration of Intent: more than 20 signatories from the most relevant financial, industrial and development actors jointly committed their interest and participation to driving renewAfrica forward. The Declaration of Intent was signed by: ABB, Cassa Depositi e Prestiti, DNV GL, EDP Renewables, Enel Green Power, Ge Renewable Energy, GWEC, Intesa Sanpaolo, Nordex, Nordic Energy Research, Norfund, Pöyry, Prysmian, PwC, REC Group, Siemens Gamesa, SMA, Solar Power Europe, Soltec, Total Eren, Vestas.

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