Africa’s $2.5T clean energy gap clashes with surging fossil fuel funding
The COP climate talks in Brazil underscore Africa's need for quality development over fossil deals. Africa faces a clean energy adaptation shortfall of about $2.5 trillion by 2030. Meanwhile, financial institutions continue to fund the fossil fuel industry, with $869 billion lent in 2024 alone.
Africa's underfunding for clean energy adaptation is a pressing issue. Estimates suggest a shortfall of around $2.5 trillion by 2030. This gap hinders the continent's transition to sustainable energy sources. Meanwhile, the Lamu Coal Power Plant project in Kenya was recently rejected due to environmental and social impact concerns, underscoring the need for careful consideration of such fossil projects.
The annual global climate talks, currently underway in Belem, Brazil, provide a platform for these discussions. Yet, financial institutions play a significant role in shaping the fight against fossil fuels. In 2024, $869 billion was lent to companies involved in the fossil fuel business. Since 2016, Multilateral Development Banks have lent a staggering $7.9 trillion to the fossil fuel industry. A report, 'Banking on Climate Chaos (BOCC)', has examined these investments, revealing that some funds have been used to expand Africa's involvement in the fossil fuel industry. Between 2019 and 2022, $98 billion flowed to fossil fuel-focused companies in Africa.
As the COP talks progress, Africa must prioritize quality development over fossil deals to meet its clean energy adaptation needs. Meanwhile, international financial institutions must reassess their funding priorities, shifting away from the fossil fuel industry to support sustainable energy projects in Africa and beyond.
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