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In sub-Saharan Africa alone, 600 million people live without access to electricity.
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Delivering greater access to clean energy will drive social and economic development.
COP28 President-designate Sultan Al Jaber has announced a UAE finance initiative that will invest $4.5 billion to unlock Africa's clean energy.
Speaking during the African Climate Summit, he said the investment initiative will aid in unlocking Africa's clean energy potential.
Al Jaber said the initiative is designed to work with Africa, for Africa.
"The initiative will prioritise investments in countries across Africa with clear transition strategies, enhanced regulatory frameworks and a master plan for developing grid infrastructure that integrates supply and demand," he said.
“In short, this initiative is designed to work with Africa, for Africa. It aims to clearly demonstrate the commercial case for clean investment across this continent. And it will act as a scalable model that can be replicated to help put Africa on a superhighway to low carbon growth.”
Al Jaber's announcement now means the UAE will commit a total of $5 billion in Africa after the UAE Carbon Alliance on Monday signed a non-binding letter with the Africa Carbon Markets Initiative’s Advance Market Signal to purchase $450 million in African carbon credits by 2030.
The COP28 President-designate said the initiative aims to clearly demonstrate the commercial case for clean investment across the continent.
He further added that it will act as a scalable model that can be replicated to help put Africa on a superhighway to low carbon growth.
The COP28 President Designate said the multi-stakeholder partnership approach is designed to accelerate sustainable economic progress, address the challenge of climate change and stimulate low carbon growth.
"This initiative builds on the UAE’s track record of commercially driven, innovative blended finance solutions that can be deployed to promote the adoption of clean energy in emerging and developing nations," he said.
This multi-stakeholder partnership approach is designed to accelerate sustainable economic progress, address the challenge of climate change and stimulate low-carbon growth.
Al Jaber called for the global tripling of renewable energy by 2030 and a push the make finance more available, accessible and affordable.
He also made a clear call to action for African leaders to improve policy and regulatory frameworks to attract the long-term investments necessary to accelerate the deployment of clean and renewable energy.
In order to reduce barriers to investment, Al Jaber highlighted multiple action points that require the coordinated efforts of African leaders and the international community.
"Restoring the financial sustainability of local utilities and modernising basic energy infrastructures, clarifying development processes and eliminating the red-tape delaying market lead-time require efforts," Al Jaber said.
The landmark initiative brings together vital public, private, and development capital from UAE institutions, notably from Abu Dhabi Fund for Development (ADFD), Etihad Credit Insurance (ECI), Masdar, and AMEA Power.
Africa50 an investment platform established by African governments and the Africa Development Bank (AfDB) has also joined the UAE finance initiative.
The initiative seeks to bring key stakeholders together to accelerate the development and delivery of infrastructure, generation and distribution solutions to close the gap in universal clean energy access.
The initiative will sit under the umbrella of Etihad 7, a development platform launched by the UAE at Abu Dhabi Sustainability Week in 2022 and championed by the Ministry of Foreign Affairs.
The key pillars of the COP28 presidency's agenda are fast-tracking the energy transition, fixing climate finance, focusing on people, lives and livelihoods and underscoring the efforts with full inclusivity.
In sub-Saharan Africa alone, 600 million people live without access to electricity.
Delivering greater access to clean energy will drive social and economic development.
Currently, investment in African renewables represents only 2 per cent of the global total and less than a quarter of the $60 billion a year the continent needs by 2030.
In 2022, it was said Etihad 7 aims to provide 100 million people across the African continent with clean electricity by 2035.
The Abu Dhabi Fund for Development (ADFD) and the Etihad Credit Insurance (ECI) will kickstart the initiative by funding the initial investment intended to catalyze private sector action.
ADFD is supporting $1 billion of financial assistance to address basic infrastructure needs, offer innovative finance solutions and increase mobilization of private investments.
The ECI is providing $500 million of credit insurance to de-risk and unlock private capital – further demonstrating ECI's commitment towards global sustainable development.
Masdar, one of the world’s largest clean energy companies is committing an additional $2 billion of equity as part of the new initiative.
It will mobilise an additional $8 billion in project finance and through its Infinity Power platform, Masdar will target the delivery of 10 gigawatts (GW) of clean energy capacity in Africa by 2030.
AMEA Power is targeting 5GW of renewable energy capacity in the continent by 2030, mobilizing $5 billion of which $1 billion will come from equity commitment and $4 billion from project finance.
Additionally, the initiative seeks to create pathways for other multilateral development banks, governments and philanthropies to catalyze additional private sector investment.
"I am calling for others including international financial institutions and foundations to join the effort to convert words into actions," he said.
The COP28 Presidency also recognises that the Global South needs to be in the driver’s seat to ensure a fully inclusive approach.
"I am also calling for the doubling of adaptation finance and to operationalise funding arrangements for Loss and Damage to ensure that those most vulnerable to the effects of climate change are protected," Al Jaber said.
The COP28 Presidency is working to achieve broader reform of International financial institutions to unlock necessary mitigation as well as adaption financing to support the Global South.
COP28 is set to take place at Expo City Dubai from November 30 to December 12.
As mandated by the Paris Climate Agreement, COP28 will deliver the first-ever Global Stocktake a comprehensive evaluation of progress against climate goals.
The UAE will lead a process for all parties to agree upon a clear roadmap to accelerate progress through a pragmatic global energy transition.