Page 12 - AfrElec Week 29 2021

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INVESTMENT project is supported under AIIB’s COVID-19 solar energy systems across sub-Saharan
Crisis Recovery Facility and will provide Africa identifies five key challenges that can
AIIB supports resilience financial support to the government’s own be addressed to unlock high-impact local
energy investment essential for sustainable
Economic Recovery Fund, a fund created to
and recovery of private support businesses most significantly affected development and economic growth on the
by COVID-19 in Rwanda.
continent.
sector in Rwanda AIIB EIB
Efforts by the Government of Rwanda to
increase access to finance for businesses SOL AR RENEWABLES
affected by the COVID-19 pandemic and
build post-pandemic economic resilience EIB, International Solar Revised power plans can
received a boost after approval of a USD100-
million loan from the Asian Infrastructure Alliance find off-grid solar speed up Southern and
Investment Bank (AIIB). The project is AIIB’s
first engagement in the east African country is key to energy access in Eastern Africa’s energy
since it became a member in 2019 and marks
the Bank’s first investment in sub-Saharan Africa transitions
Africa.
With many critical sectors stifled because The European Investment Bank and the Africa desperately needs electricity for its
of measures put in place to contain the spread International Solar Alliance today published socio-economic development. Over the last 25
of the virus, Rwanda’s GDP fell by 12.4 percent a new study outlining solutions to overcome years, demand has grown at an annual average
and 3.6 percent year-on-year in the second key affordability and investment challenges of 3.3%. By 2040, total demand is expected to
and third quarters of 2020, respectively, with holding back off-grid solar investment across triple to approximately 1600 TWh.
annual GDP in 2020 declining by 3.4 percent, Africa. This demand can certainly be met with
ushering the first recession in more than two “Increased use of off-grid solar technology the continent’s abundant but currently hugely
decades. across Africa is essential to harness clean and untapped renewables resources. Northern
The economic fallout has been particularly affordable energy and transform the lives and Southern Africa are among the sunniest
challenging for micro, small and medium of millions of people. The new European places on earth. Wind speeds are impressively
enterprises (MSMEs) which constitute 98 Investment Bank and International Solar high in East, Northern and Southern Africa.
percent of businesses in the formal sector, Alliance study published today combines In terms of hydro discharge volume, the
and 72 percent of employment. Employment experience and expertise from successful off- Congo River is second only to the Amazon.
has fallen sharply with joblessness reaching grid deployment to outline how investment To unlock this potential, Africa needs to revise
its highest point since 2016, at 22.1 percent in can be unlocked to increase access to solar its regional master plans that currently favour
May 2020. power. The ground-breaking analysis fossil-fuels despite the enormous advances
“The COVID-19 crisis has heightened demonstrates how closer cooperation between and cost reductions of renewable technologies.
economic uncertainty and resulted in a large African, European and global partners can IRENA identified 4290 renewable energy
decline in private-sector investment. New unlock investment and technical barriers zones in countries included in the African
business investment is needed to ensure that hold back sustainable development and Clean Energy Corridor (ACEC), with solar
Rwanda’s economy is well-positioned to the green transition.” said Ambroise Fayolle, and wind power offering generation potential
not just survive the economic effects of European Investment Bank Vice President. as much as 7 TW and 2 TW respectively, of
the pandemic but recover and regain a “The joint International Solar Alliance – which more than 99% are still untapped. Such
path to resilient growth. The AIIB loan, European Investment Bank study outlines a potential offers an opportunity for the region
which will finance sub-loans to businesses pathway to unlock access to off-grid solar in to integrate renewable energy in its power
for investments that contribute to job Africa. This builds on proven success, expert pools master plans and meet its energy needs.
creation, recovery and sustainable growth, insight and commercial experience to identify Current master plans of the Eastern and
demonstrates the Bank’s relevance and and overcome investment gaps and financial Southern African power pools foresee the
value to its nonregional members during barriers holding back off-grid solar. The study addition of more than 100 GW of new coal-
a time of severe crisis and need,” said AIIB details what can be done to increase access to fired capacities by 2040. Unless these plans are
Infrastructure Sector Economist, Suzanne clean energy to off-grid rural areas including revisited and revised with a view on including
Shaw. refugee camps, urban areas and remote the regions’ abundant low-cost renewable
It is expected that at least half the total villages across Africa.” said Dr Ajay Mathur, resources, CO2 emissions will triple from 407
volume of the investment credit line will go Director General of the International Solar Mt/year in 2016 to 1 200 Mt/year in 2040.
to the SME sector, and at least 35 percent of Alliance. IRENA’s assessment of the future of the
sub-loans will go to women-owned and/or At present more than 120 million ACEC power systems further challenges the
managed firms. Under the project, businesses households across Africa lack access to need for 100 GW plus of new coal capacities.
will also benefit from risk-sharing schemes, reliable and affordable energy, with 60 million The deployment of solar photovoltaic (PV)
and technical assistance will be provided to households expected to remain without and wind technologies in the identified
strengthen their ability to access finance and electricity by 2030 unless urgent action is zones combined with investment in adequate
sustain their growth beyond the life of the taken. transmission infrastructures can avoid a
project. The new in-depth overview of recent build-up of coal capacities in a cost-effective
Co-financed with the World Bank, the private sector led deployment of small-scale and climate compatible manner. Moreover,

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