REPORT: Europe Remains a Global Leader in SDG7-Finance in Africa – Accelerated Efforts Needed for Universal Energy Access

PRESS RELEASE
Addis Ababa, Ethiopia – 17 December 2024

The third report on ‘European financial flows on SDG7 to Africa’, commissioned by the Africa-EU Energy Partnership (AEEP), shows that current investments towards the UN Sustainable Development Goal 7 (SDG7) in Africa have led to notable progress, but larger efforts will be required to reach universal clean energy access on the continent.

Building on the first two reports, the third edition provides a comprehensive analysis of the financing landscape for SDG7 in Africa over the 2014-2022 period, outlining the European Union’s pivotal contribution, while painting a clear picture of the gap between current progress to SDG7 and the 2030 target.

The pace of progress remains too slow to meet SDG7 in Africa, especially considering the 2030 target. This is despite consistent efforts by the European Union (EU) and its Member States, other public donors, and African governments, which have resulted in the addition of vital infrastructure. The repercussions of the COVID-19 pandemic and shocks resulting from geopolitical tensions have further slowed down progress in recent years.

Out of all SDG7 target areas, renewable energy is the sector that received the largest share of global finance with a total of EUR 34.3 billion, followed by electricity access at EUR 22.2 billion. Coincidentally, these are the sectors where most progress was achieved. The installed renewable capacity doubled from 32.5 GW in 2014 to 54.9 GW in 2022, while electricity coverage increased significantly from 38.26% to 51.43% between 2014 and 2022. This, however, still leaves 588 million people without access to electricity. The largest gap towards reaching SDG7 in Africa exists in clean cooking. While the proportion of Africa’s population using clean cooking fuels and technologies has marginally increased to 33.6% in 2022, up from 28.8% in 2014, progress in clean cooking struggles to keep up with population growth in Africa.

European Institutions and EU Member States continue to be global leaders in financing SDG7-related projects on the African continent. Over the 2014-2022 period, funding from public donors towards SDG7 totalled EUR 61.7 billion, with the largest provider being multilateral institutions (EUR 35 billion). Europe has provided the second largest amount of SDG7-related public commitments with a total of EUR 18.7 billion. Most of this funding (95%) was ODA-compliant, while being predominantly directed at renewable generation (57%) and transmission and distribution projects (29%).

Europe also plays a major role in leveraging private sector investments, having mobilised EUR 3.7 billion in private finance to SDG7-related projects. This equals 27% of the total mobilised private sector finance to SDG7 over the period. In the coming decade, Europe will likely remain a leading catalyst of additional private sector investment, much needed to close the investment gap as public funding is limited.

The progress towards SDG7 also relies significantly on increased efforts from African states. From 2014-2022, African national governments spent a total of EUR 105 billion on energy. This spending has fallen to critically low levels in 2021 and 2022, as the impact of COVID-19 and issues of public debt and macroeconomic weaknesses ravaged public finances across the continent. For SDG7 to become a reality in Africa by 2030, tremendous financial efforts will be needed from all funding sources.

“Achieving universal energy access in Africa is a formidable challenge, but it is not insurmountable. With a shared commitment, renewed ambition, and a stronger focus on evidence-based action, we can accelerate progress towards reaching SDG7 in Africa”, says Dr Towela Nyirenda Jere, Head of Secretariat, Africa-EU Energy Partnership

Media Contact:

Nina Simberg-Koulumies

PR & Communications Specialist

T: +49 162 2989643

E: nina.simberg-koulumies@aeep-secretariat.org

Download the full report: European Financial Flows on SDG7 to Africa – Third Edition – Africa-EU Energy Partnership