The European Financial Flows on SDG7 to Africa 2022 report shows the extent that progress has been made in delivering sustainable energy and increasing access in Africa during the past decade.
The inaugural AEEP report (the 2021 edition) found that SDG7 in Africa could be achieved with the mobilisation of considerable resources.It showed a significant funding gap, which required an optimal alignment of effort and a scale-up of activities to overcome. It also found that individual actors were making impressive progress – notably the national governments and African development institutions, which have been playing a vital and leading role in meeting the continent’s ambitions.
Analysis of the most recent figures reinforces the central finding of the 2021 report that sizeable increases in funding are needed to stimulate growth in energy access and to achieve SDG7 by, or soon after, 2030.
Encouragingly, the findings also strengthen, and add further detail to, the conclusion that a realistic pathway towards closing the investment gap exists, provided a number of conditions are met by the key stakeholders. In this context, Europe’s major commitments of increased financing and technical assistance will play a critical role, although not the only one.
The pathway to achieving total SDG7 investment of EUR 200 billion (according to the International Energy Agency) by 2030, would require a year-on-year growth rate of 9.7%. This would involve finding an additional EUR 60 billion or EUR 6.6 billion a year between 2022 and 2030.
Team Europe continues to provide significant finance for SDG7 projects in Africa. Its consistent support over the past seven years has provided a foundation for ever more multilateral and private sector commitments, which now both exceed EU contributions.
A breakdown of Team Europe’s commitments shows where it is already most active. It committed EUR 1.93 billion to SDG7-projects in 2020, predominantly directed at renewable generation (EUR 1.1 billion), and transmission and distribution (T&D) projects (EUR 778 million). Team Europe does not only provide ODA funding, but it has provided the vast majority of ODA financing for SDG7-compliant projects between 2014 and 2020 with EUR 13.8 billion.
Bringing ever more increasing resources to this challenge was always going to be a demanding task, and is likely to be even harder in the aftermath of Covid-19 pandemic, as the world continues to adjust to the pandemic’s impact and to new risks to food and energy security, as well as inflation, that have been exacerbated following the Russian military aggression against Ukraine.
However, the analysis of financial flows and the evidence from the case studies featured in this report show that developments are heading in the right direction, but that huge potential for faster and more dynamic growth remains untapped. An accelerated and intensified drive is required to meet SDG7 in a timely way.