Africa has to build resilience to both energy and climate crisis, but analysis of public finance flowing to energy infrastructure in Africa from 2014 through 2016 has revealed a worrying trend.
Between 2014 and 2016, nearly 60 per cent of Government-backed finance for energy in Africa went into supporting fossil fuel projects
Data Source: Assessing International Public Finance for Energy in Africa: Where Do Development and Climate Priorities Stand?, Oil Change International, July 2018
China, multilateral agencies pushing fossil fuel agenda
Egypt and Angola received US$12.7 billion and $10 billion respectively, and nearly all of the public finance received by the two countries was for oil and gas. Even countries such as Sudan, Morocco, Nigeria and Ghana witnessed significant investment on fossil fuels during this three-year period.
Did you know? While nearly 60 per cent of public finance for energy in Africa went to fossil fuels, only 18 per cent went to clean energy projects.
Did you know? Multilateral development banks provided about one-third of the public finance for Africa’s energy sector from 2014 to 2016. About 60 per cent ($11.4 billion) came from the World Bank Group, followed by the African Development Bank ($4.1 billion)
Europe also responsible for funding fossil fuel projects in Africa
Collectively, countries in Europe provided about USD 4.4 billion per year on average in public finance to Africa's energy sector. Sixty-two per cent went to fossil fuels, 22 per cent to clean energy, and 16 per cent to other energy projects.
Graph shows the Annual Average Finance by Institution into Clean Energy, FY 2014 to 2016 (USD Millions)
hover over the graph to see details
European bilateral institutions provided about $957 million per year in public finance for clean energy in Africa– one-third of which was provided to fossil fuels. Italy and Germany were among the largest European funders of oil and gas projects in Africa. Collectively, they contributed 84 per cent of oil and gas finance from European countries to Africa over the three-year period.
Did you know? Less than 2 per cent of public finance for energy in Africa during this period supported distributed renewable energy solutions
Graph shows the Annual Average Finance by Institution into Clean Energy, FY 2014 to 2016 (USD Millions)
hover over the graph to see details
Data Source: Assessing International Public Finance for Energy in Africa: Where Do Development and Climate Priorities Stand?, Oil Change International, July 2018
Public finance supporting commercial interests of funding nations
Instead of supporting the energy transition in Africa, majority of bilateral public finance is supporting the commercial interests of the countries providing it. In fact, one-third of the finance assessed in this analysis came from export credit agencies, which aim to support home-country companies to secure business overseas.
Did you know? Public finance flows for energy are unevenly distributed across countries. Three countries – Egypt, Angola, and South Africa – received nearly half of the USD 59.5 billion in total public finance for energy across the continent from 2014 to 2016
Africa cannot lose focus on renewables
Graph shows the Annual Average Finance by Countries and Multilateral Development Banks into Clean Energy (USD Millions)
hover over the graph to see details
Data Source: Assessing International Public Finance for Energy in Africa: Where Do Development and Climate Priorities Stand?, Oil Change International, July 2018
To achieve universal access to affordable, reliable and clean energy by 2030, as set out in the UN Sustainable Development Goals, Africa needs to scale up investment in energy infrastructure—especially in distributed renewable energy. But in a continent like Africa, where millions still live in poverty, without adequate access to energy for basic services, investments must avoid exacerbating the severity of climate crisis. That is why the governments’ decisions on where and how to spend public finance will be crucial.
Data source:
✸ Assessing International Public Finance for Energy in Africa, Oil Change International
✸ World Bank
✸ International Energy Agency (IEA)
