In its 2014 Annual Report Financing Change: AfDB and CIF for a Climate-Smart Africa released Thursday, February 26, the African Development Bank (AfDB) shows that its support to Africa through the Climate Investment Funds (CIF) increased exponentially in 2014 to include one regional and 25 national Investment Plans, with an additional nine poor countries being funded for renewable energy solutions.
It also shows an additional $500 million from AfDB and CIF for a total of $2.1 billion going to 16 projects already underway in 11 African nations.
As the report shows, 34% of the $8.1 billion global CIF portfolio goes to Africa, recognizing the region's unique needs. Through its CIF portfolio, the AfDB supports countries to implement projects in Investment Plans through the CIF's Clean Technology Fund (CTF), Forest Investment Program (FIP), Pilot Program for Climate Resilience (PPCR), and Program for Scaling Up Renewable Energy in Low Income Countries (SREP).
The report highlights five areas of growth in the four programs in 2014. First, the portfolio moved into full implementation in the 16 original AfDB CIF Investment Plans and in some cases to a second stage of development, such as in Concentrated Solar Power in Morocco and geothermal in Kenya. Second, it added newcomer pilots Benin, Ghana, Lesotho, Madagascar, Malawi, Rwanda, Sierra Leone, Uganda and Zambia under SREP. Third, it helped countries move forward in efforts to engage the private sector at the local and national levels, including through innovative private sector projects in Kenya, Mali, Ghana and Mozambique. Fourth, it facilitated innovative financial solutions such as financial intermediation through local commercial banks and long-term debt financing in local currency. And fifth, it moved into an integrated approach to mitigation and adaptation in the forest and agriculture sectors through the FIP.
"Through the AfDB CIF portfolio, we are beginning to witness countries seeing economic transformation take place first-hand by incorporating low-carbon and climate-resilient solutions as an integral part of their ongoing business of development," said Kurt Lonsway, AfDB Manager, Environment and Climate Change. "Our role at AfDB is to provide climate finance in such a way that we effectively help countries create bankable climate-smart projects. In 2014, our work through the CIF with the other Multilateral Development Banks helped move that work substantially forward."
The projects already underway cover a range of climate-smart solutions including concentrated solar power, wind and geothermal energy, and increased energy efficiency, institutional frameworks and innovative financial mechanisms for renewables, climate-resilient land and water solutions, climate forecasting and early warning systems, and participatory management and local community engagement in sustainable forest solutions.
Expected results from these projects include transformational impacts not only in climate-related sectors but also in a range of development sectors. For example, some project areas are expected to see a 2.1 gigawatt (GW) increase in energy through renewables, a 390 megawatt (MW) increase in geothermal capacity, significant poverty reduction, and an exponential increase in rural micro-enterprises
Established in 2008, as one of the largest fast-tracked climate financing instruments in the world, the $8.1 billion CIF provides developing countries with grants, concessional loans, risk mitigation instruments, and equity that leverage significant financing from the private sector, MDBs and other sources. Five MDBs - the African Development Bank (AfDB), Asian Development Bank (ADB), European Bank for Reconstruction and Development (EBRD), Inter-American Development Bank (IDB), and World Bank Group (WBG) - implement CIF-funded projects and programs.
