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EconomyEnergyFinance & ServicesSouth Africa

South Africa talking with more countries to end reliance on coal

by Radarr Africa
written by Radarr Africa

South Africa, having secured $8.5 billion (R146.83 billion) in climate finance from some of the world’s richest countries, is in talks with additional nations to help it cut reliance on coal, Environment Minister Barbara Creecy said.

The climate finance — which is being provided by the US, UK, Germany, France and the European Union as part of a Just Energy Transition Partnership — has been hailed as a prototype for deals to wean other coal-dependent developing nations off the dirtiest fossil fuel.

Still, it’s a fraction of the R1.5 trillion ($87 billion) the country has estimated it needs for its plan to move away from coal over the next five years.

“We’ve had some bilaterals where there’s been additional interest shown,” Creecy said in an interview at the COP27 climate summit in Egypt, referring to talks with other countries.

President Cyril Ramaphosa indicated to the partners “that we are now going to make the circle bigger and other countries that would want to contribute to the JET Investment Plan, we are going to include them as well.”

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With more than 80% of its electricity coming from a fleet of mainly dilapidated coal-fired power plants and regular rolling blackouts because the state power utility, Eskom Holdings SOC Ltd., can’t meet demand, the country is in dire need of investment in its electricity sector.

Sun, Wind

As the world’s 13th-biggest source of climate-warming gases, South Africa is an attractive option for rich nations trying to maximise the impact of their investments in cutting carbon emissions.

The age of its power plants means that they will have to close in coming years anyway and the country is amply supplied with sun and wind resources to generate renewable power.

In addition to electricity, South Africa, as part of its coal transition plan, is trying to boost investment in its nascent electric vehicle and green hydrogen industries. Green hydrogen refers to a process where water is split to make the fuel using energy from renewable sources.

The US and Japan on Nov. 15 announced a similar deal for Indonesia at a cost of $20 billion. On Nov. 16 Bloomberg reported that Vietnam may secure as much as $14 billion in a process led by the UK and European Union, citing people who asked not to be named because a public announcement is yet to be made.

Creecy also reiterated the need to reform multilateral development banks, such as the World Bank and International Monetary Fund so that they lend more easily to climate finance projects.

She also said they will need to be recapitalised to enable the quantum of spending that will be needed to transition to a lower carbon future.

“You’ve got to actually say what is this transition going to cost,” she said. “If we think that the only source of finance that will be available to all of us is going to be what’s in the climate funds, it’s not going to be enough.”

SOURCE: My broadband

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BusinessEconomyEnergyNigeria

Nigeria to requires N834tn to meet net zero target by 2060

by Radarr Africa
written by Radarr Africa

The Federal Government has said Nigeria will require $1.9trn or N834trn to attain net zero by 2060 as part of its support to the global fight against climate change and meeting the country’s Energy Transition Plan.

A document on the Energy Transition Plan obtained by The PUNCH on Sunday said Nigeria would require $1.9trn to get to net zero by 2060,  including $410bn above projected usual spending, which translates to about $10bn or N4trn annually over the coming decades.

To kickstart the implementation of the plan, the Federal Government said Nigeria would raise an initial $10bn support package ahead of the COP27 holding in Egypt, adding that a $23bn investment opportunity had also been identified based on current in-country programmes and projected that were directly related to just the energy transition.

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According to the document, there would be incremental investments from 2021 through 2060 to attain the plan.

A breakdown of the required spending by sector shows that $135bn will be spent in the infrastructure sector, while $150bn is to be spent on the power sector. Also, $12bn will be expended on the oil and gas sector; $21bn on industry; $79bn on the cooking sector; and $12bn on the transport sector.

SOURCE : Punch news

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BusinessEconomyFinance & ServicesKenya News

KEPSA launches a strategy For The Implementation Of Business Climate Change Solutions

by Radarr Africa
written by Radarr Africa

The Kenya Private Sector Alliance (KEPSA) has launched a strategy that aims to promote coordinated and inclusive business climate change solutions across the sector.

The Kenya Private Sector Strategy On Climate Change Solutions 2022-2030 is anchored on climate change mitigation, climate change adaptation and resilience, climate information and capacity building, and Public-Private partnership for climate change.

It aims to be a reference point for the private sector decisions on climate change in addition to providing the sector with steps towards enhancing climate change mitigation and adaptation through investment, awareness creation and channeling resources to combat climate change for business sustainability.

Speaking during the launch, KEPSA Deputy Chief Executive Officer (CEO) Martha Cheruto, noted that the private sector faces significant exposure to climate risk through its assets, operations, and supply chains and thus has considerable reasons to invest in climate risk management, to not only protect itself but also to harness new business opportunities arising from the changing climate.

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“The Private Sector Strategy on Climate Change Solutions in Kenya identifies actions that the private sector will take between 2022 and 2030 in contributing to the achievement of the government climate change targets and is positioned to be Kenya’s Business Commitment to Climate Action(B2CAK) for both Corporates and SME’s,” said Cheruto.

The strategy has incorporated approaches from different stakeholders through The Green Climate Fund (GCF) whose outcome intends to strengthen and institutionalize the private sector involvement and investment in climate change adaptation.

While delivering the keynote address on behalf of Principal Secretary (PS) Ministry of Environment and Forestry Chris Kiptoo, Director General of the National Environment Management Authority (NEMA) Mamo Boru Mamo lauded the strategy as it offers the private sector an opportunity to set institutional and strategic mechanisms to galvanize sector-wide resources toward a unified national climate change priorities approach.

“Addressing the impacts of climate change and promoting green growth, necessitates a concerted effort from both the state and non-state actors,” he said.

FAO Kenya Deputy Representative Hamisi Williams noted the adverse climatic events in the country have not only had an impact on the socioeconomic activities in the country but have also contributed to the derailing of the country’s economic development.

The launch comes ahead of the 27th session of the Conference of Parties (COP 27) to the United Nations Framework Convention on Climate Change (UNFCC) slated for November 7 to 18 in Egypt.

The convention aims to boost climate conversations, mobilize action and provide an important opportunity for stakeholders to consider emerging issues and the impact they have on climate change in Africa.

SOURCE: Capital business

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AgricultureBusinessEconomyKenya News

Tea farmers Face Losses As Climate Change Starts To Take Course in Kenya

by Radarr Africa
written by Radarr Africa

James Maina, a tea farmer in Muranga county in Kenya is a distraught man.

Maina has been a farmer since the 1990s, his farm has earned him enough to school his kids and bring up his family.

Since 2018, his production has been going lower and lower with the changes in weather patterns resulting in longer dryer periods and low rainfall.

Currently, he collects 300,000 tones of tea in a harvest from a high of 1 million tones recorded six years ago. Maina could lose his livelihood in the next ten years, unable to put a meal on the table if the unfavorable weather conditions in the country continue.

The story of Maina is one being faced by a number of Kenyans, with 40 per cent of the country’s workforce being in the agriculture sector. As the effects of climate change become more severe, the country’s agriculture sector which acts as the food basket continues to shrink.

In the second quarter of 2022, Kenya National Bureau of Statistics(KNBS) data shows that the agriculture sector’s contribution to the country’s GDP contracted for the third consecutive quarter.

This was attributed to unfavorable weather conditions that characterized the last quarter of 2021 and the first half of 2022. The sector is estimated to have contracted by 2.1 per cent in the second quarter of 2022 compared to a contraction of 0.5 per cent in the corresponding quarter of 2021,” said KNBS.

According to a report by the Africa Development Bank(AfDB) on the climate change impacts on Africa’s economic growth, Kenya is expected to be among the most-affected countries with high warming by 2030 resulting in associated median change in GDP per capita.

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It notes that Eastern Africa could experience two distinct precipitation trends resulting from future climate change.

“The Global climate models project a progressive wetting in the northern countries, including Ethiopia and northern Kenya, with annual precipitation increase of 12 to 18 per cent as compared to present-day levels in the lowwarming scenario, and as much as 18 to 30 per cent in the high-warming scenario,” AfDB said.

Accordingly, the United Republic of Tanzania and Kenya would be more severely affected with projected losses between 6.0 and 4.4 per cent in the high-warming scenario. It further highlights that by mid-century, Eastern Africa’s three powerhouses (Ethiopia, Kenya, and the United Republic of Tanzania) could be exposed to losses amounting to about 10 per cent.

“Such high losses for these three countries highlight their current vulnerability to climate variability and weather extremes combined with future rapidly changing precipitation and temperature patterns,” AfDB notes.

Kenya’s successive climate change impacts over the past 10 years have resulted in socio-economic losses estimated at 3 – 5 per cent of the GDP annually despite having negligible global GHG emissions, it notes. This means that it can no longer be business as usual, every Kenyan needs to realize how we can reduce climate change.

Meanwhile, Kenya has been making strides in averting the climate change crisis, for instance, the country has developed its intended nationally determined contribution (INDC) and joint crediting mechanisms which were submitted in 2015.

The two initiatives aim to reduce emissions by 30 per cent relative to the BAU scenario by 2030. This target was taken as half of the potential emission reduction by 2030, the country is also mainstreaming climate change adaptation and resilience in all sectors.

President William Ruto during the UN General Assembly asked continental colleagues to see the climate crisis as Africa’s biggest problem, suggesting more financial focus on taming its effects.

Speaking on the sidelines of the Assembly in New York, the President indicated while the world should focus on rebuilding from the Covid-19 pandemic and other crises, Africa may find itself hurt more by climate change, in spite of contributing the least of its causes.

“While these are important issues affecting the entire world, the greatest challenge that connects our world is Climate Change: unfortunately, due to many pressing concerns, CoP27 has not been given the prominence it deserves,” he said.

Despite Africa’s small contribution to climate change, we are one of the most affected regions therefore we including James Maina need to act now to avert this looming crisis.

SOURCE: Capital business

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BusinessEconomyFinance & ServicesKenya News

Kenya’s Retail Investors Can help to crack Financing For ESG Objectives

by Radarr Africa
written by Radarr Africa

Retail traders in the country have a great potential to crack financing for Environmental, Social and Governance (ESG) objectives and priorities if some hindrances are resolved, a report by Standard Chartered indicates.

The Sustainable Banking Report 2022 themed ‘Mobilizing retail investor capital through sustainable investing’ found that investors in Kenya have the potential of channeling Sh2trillion to finance the climate transition in addition to bridging the funding gaps in ESG’s important considerations such as food and water security, human rights and poverty.

From the findings of the study, Kenya’s large population and the rising domestic wealth gives it a high potential of raising over Sh2trillion in sustainable retail investment by 2030 as close to 40 per cent of investors in the country are willing to inject some funds towards addressing the climate issues.

Moreover, the study found out the top ESG priorities for investors in Kenya included  climate change and carbon emissions; food and water scarcity which accounted for 36 per cent, poverty and income inequality at 32 per cent and human rights at 24 per cent.

The report further indicated that comprehensibility (48 per cent), accessibility (48 per cent) and comparability (47 per cent) were the top barriers that investors in Kenya faced and they need to be addressed for them to unlock the Sh2trillion financing for sustainable investments.

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“We know that a rapidly growing number of our clients want their investments to make a positive impact on the environment and in society and there is a significant appetite to take ESG investment from a niche play to a mainstream investment strategy. As a bank, we have the expertise and solutions to help investors achieve both profit and purpose. Importantly, we need to enable the shift now for a more sustainable future,” said Paul Njoki, Head of Affluent Banking and Wealth Management in Kenya and East Africa at Standard Chartered Bank.

The report indicates a need for democratizing access to sustainable investments for investors by relying on digital platforms to offer solutions available in the market in addition to addressing investor apprehensions and providing data-led advice on how to match their ESG priorities with the appropriate solutions.

The research which was commissioned by Standard Chartered and conducted by PwC Singapore carried out a survey among some 3113 individuals across 10 markets and three investor segments to understand retail investors’ behavior traits, interests in, motivations and barriers towards sustainable investments.

SOURCE: Capital business

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AfricaEconomyEgyptGlobal NewsNewsNorth AfricaSouthern Africa

As COP27 looms, Africa receives a 10th of climate financing it needs

by Radarr Africa
written by Radarr Africa

As the international climate community prepares for COP27 in Sharm el-Sheikh, Egypt, new analysis shows just how far off their host continent is in terms of attracting the finance it needs to adapt to catastrophic global warming, build renewable energy plants, and enhance its carbon-absorbing ecosystems.

At $30 billion, annual climate finance flows in Africa are just 11% of the $277 billion needed, according to research published Wednesday by the Climate Policy Initiative, a US-based nonprofit.

The research was commissioned by FSD Africa, an organization funded by the UK government, the Children’s Investment Fund Foundation, a charity set up by billionaire hedge fund activist Christopher Hohn, and UK Aid. It’s the first to map climate finance flows in Africa by region, sector, and source, and captures available data for 2019 and 2020.

Top of the agenda at the November UN climate summit in Egypt, known as COP27, will be demands from developing nations for more funding from rich countries to adapt to global warming and a financing mechanism to help them cope with natural disasters and extreme weather events.

In 2009, developed countries committed to $100 billion of assistance for poorer nations every year. They have fallen significantly short of that target.

Africa accounts for a tiny fraction of the world’s carbon emissions but its nations will be among the hardest hit by global warming, already manifested globally in disasters ranging from heat waves in Europe to droughts in the Horn of Africa and floods in Pakistan.

“A report such as this allows us to measure whether the commitments of developed countries to provide finance to developing countries, is indeed being delivered,” said Valli Moosa, deputy chairman and effective head of South Africa’s Presidential Climate Change Coordinating Commission, in a statement.

Private sector finance in particular remains too low, the Climate Policy Initiative said in the report. Companies and commercial financial institutions contributed just 14% of total climate finance received in Africa, much lower than in other developing regions.

Existing flows are highly concentrated, with 10 of the 54 countries on the continent accounting for more than half of Africa’s climate finance. These include Egypt, Morocco, Nigeria, Kenya, Ethiopia and South Africa.

The Southern African region bears the largest financing gap in absolute terms, attributed by the researchers to the $107 billion annual needs of South Africa alone, combined with one of the lowest regional levels of climate investment. As a percentage of gross domestic product, countries in Central and East Africa face the largest investment gaps.

Investment opportunities

South Africa, the continent’s most industrialised nation, is transitioning from reliance on coal for more than 80% of its electricity to renewable energy, meaning that billions of dollars will need to be spent on new power plants and an expanded electricity grid.

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“Public and private actors must act with scale and speed to help bring Africa’s climate goals to fruition,” said Barbara Buchner, global managing director of the Climate Policy Initiative. “Africa offers a wealth of climate-related investment opportunities” and “the social, economic, and environmental benefits which could be realised are even greater,” she said.

Those investment opportunities are spread across a number of sectors, including clean energy plants and agribusiness.

Annual investment in renewable power stands at just 7% of the $133 billion that the International Energy Agency estimates African countries need to meet their 2030 energy and climate goals, according to the research. Agriculture and forestry investments are also falling short of financing needs.

Source: Bloomberg

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AfricaAFRICA NEWSBanking, Finance & InvestmentBusiness

AfDB receives $5 million grant to tackle methane emissions

by Radarr Africa
written by Radarr Africa

The United States government has announced it will provide a US$5 million grant to the African Development Bank (AfDB) to support efforts to abate methane gas emission, across Africa.

Methane accounts for about half of the net rise in global average temperature since the pre-industrial era.

The grant, subject to the completion of US domestic procedures and approvals, will go to the multi-donor Africa Climate Change Fund, which is managed by the African Development Bank.

The Fund supports a broad range of activities covering climate resilience and low-carbon growth.

US special presidential envoy for climate John Kerry, made the announcement at a breakfast event held on the margins of the 18th African Ministerial Conference on the Environment taking place in Dakar.

He said: “More than 25 countries on the continent have joined the Global Methane Pledge, a resounding level of support for the importance of methane in keeping 1.5 degrees within reach.”

“I am very pleased that the African Development Bank is responding to the increased global attention on methane emissions and is planning to increase their own focus on methane abatement in coming years,” Kerry added.

Additional funding was also promised by the Climate and Clean Air Coalition (CCAC) and the Global Methane Hub to tackle methane emissions in African countries.

The Global Methane Hub will contribute US$5 million dollars over the next three years. The Hub funds methane mitigation efforts. The Coalition, a voluntary partnership of governments, intergovernmental organisations, businesses, and research institutions, will provide US$1.2 million.

The Global Methane pledge, launched during COP26, targets reducing emissions of methane by at least 30 percent from 2020 levels over the next seven years.

Welcoming the contributions, African Development Bank Vice President for Power, Energy, Climate and Green Growth, Kevin Kariuki, said the bank planned to create activities within the ACCF to support methane abatement.

“With the support of the U.S. government, and other donors and non-state actors, we intend to create a dedicated pillar of activities within our Africa Climate Change Fund to support methane abatement including working with countries to include methane in their Nationally Defined Contributions and develop pipelines of methane abatement projects for further investment,” Kariuki said.

The African Development Bank would be releasing a methane baseline reporting covering waste and energy sector methane emissions across Africa at the forthcoming COP 27 in Sharm El Sheikh, Egypt.

“This will provide an excellent foundation for increased focus on methane emissions,” said Kariuki.

ALSO READ: Egypt Prepares for Flagship United Nations (UN) Climate Conference

The African Development Bank’s 2022 Africa Economic Outlook projects that Africa will need as much as US$1.6 trillion between 2020 and 2030 to implement its climate action commitments and NDCs.

The African Development Bank has committed to mobilising US$25 billion for climate finance by 2025; more than 50 per cent of that funding will be allocated to adaptation projects.

The resumed five-day 18th Session of the African Ministerial Conference on the Environment in Dakar, ended on Friday, September 16.

Organised by the United Nations Environment Programme, it provides African environment minsters a forum to offer policy guidance that will contribute to strengthening Africa’s voice at the COP27. 

Source: Ghanaian Times

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Banking, Finance & InvestmentBusinessEastern Africa

KCB and IFC partner to Finance Climate Change Efforts in Kenya

by Radarr Africa
written by Radarr Africa

KCB Bank Kenya has secured a Sh18billion loan from the International Finance Corporation (IFC) that will boost the lender’s support for businesses that address climate change.

Through the partnership, IFC will support KCB to develop a climate finance strategy and build the lender’s capacity for climate risk assessment and reporting.

KCB Group Chief Executive Officer Paul Russo noted that the bank’s business is not just about making profits but it also has a role in ensuring the environment is taken care of for posterity through playing its role in climate mitigation and adaptation in Kenya.

“KCB is stepping in to help businesses curtail the adverse impacts of climate change, thus boosting economic growth, food security and job creation in Kenya and building resilience,” said Russo.

By the year 2030, the Government of Kenya is committed to ensuring greenhouse gas emissions in the country is reduced by 32 per cent by integrating climate change adaptation at both the national and county levels of government as the country is vulnerable to climate change that might further worsen the current rising food insecurity and drought.

IFC Country Manager for Kenya Amena Arif on his part emphasized the need for the private sector to mobilize financial resources to help the country transition to green energy as frequent occurrences of droughts and floods affect the livelihoods of many Kenyans which further affect the economic development of the country.

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“Our partnership with KCB Bank Kenya will increase access to climate finance in the country and enable the development of more green projects that support Kenya to respond to the effects of climate change and shift to a greener development model,” said Arif.

A 2019 IFC report estimated that Nairobi has an $8.5 billion climate investment opportunity for the period 2018 to 2030—$5 billion of which lies in electric vehicles and the rest in public transport, green buildings, water, renewable energy, and waste.

The loan by IFC is part of its work in Kenya to increase the amount of climate financing available as it is committed to growing its climate-related investments worldwide by working with different financial institutions to fund projects that support climate mitigation and adaptation.

SOURCE: Capital business

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