The African Petroleum Producers’ Organisation (APPO) - establish an African Energy (Fossil Fuel) Bank
(Photo: Extinction Rebellion Cape Town/Twitter)
The
last COP in Dubai concluded with the global stocktaking text that included a
tripling of renewable energy and a doubling of energy efficiency improvements
globally by 2030. It also included an
unprecedented commitment to “transition away from fossil fuels”.
Meanwhile, this week the African Petroleum Producers’ Organisation (APPO), an association of African petroleum-producing countries, announced Nigeria would
host the newly created Africa Energy Bank (AEB).
This bank
has been set up to support the development of fossil fuel projects in Africa.
It has an initial share capital of $5bn and it says it will fund not only
fossil fuel expansion but also renewable energy.
APPO has a
strong partnership with OPEC which will support its efforts to expand Africa’s
oil and gas. In Sharm El Shiekh at COP27 (2022) several African Civil
Society organizations including Oilwatch Africa, Stop EACOP, Africa Coal
Network and Urgewald released a report on Who is financing Fossil Fuel Expansionin Africa. The report identified 200 copies and said that these companies have expansion
projects in 44 of 55 countries. According to the NGO report, 72% of the banks supporting
fossil fuel developers in Africa came from banks that are members of the “Net
Zero Banking Alliance”.
This report
did have an impact and developed country banks are under scrutiny from their shareholders
and stakeholders to show commitment to net-Zero with their investments
The establishment of the African Energy Bank is the beginning of an intended alliance of African Banks – some 700 potential partners, the Bank seeing more hesitation on funding from developed countries' banks is seeking to mobilise African funding.
In April at
the Spring Meetings of the World Bank there had been unsuccessful pressure to
move the Bank’s funding from oil and gas significantly to financing renewables
in Africa.
“If the
World Bank maintains its stance on gas, it risks perpetuating a neocolonial
narrative by anchoring Africa in a fossil fuel-dependent development model that
binds the continent to poverty and environmental degradation. This approach not
only stifles Africa's potential to harness its vast renewable resources for
clean, affordable energy but also obstructs a path toward sustainable and
equitable prosperity. Africa must leverage its renewable
energy capacities to foster genuine development that benefits all.” DeanBhekumuzi Bhebhe (Common Dreams)
How all this
will be reflected in the New National Determined Contributions made by African countries in February 2025 under the
Paris Climate Agreement is unclear. How the Bank can continue on one Hand to be
playing a role as the bank for the Loss and Damage Fund and at the same time
support fossil fuel development not only in Africa but concerning this
article in Africa is a problem. The Bank needs a transition plan to support any
fossil fuel development. Perhaps COP29 offers the chance for them to explain
how they might do that.
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