59 • Power generation, transmission, and distribution: investments in lowcarbon energy that support a viable energy transition on the continent, including grid-connected and off-grid renewable energy installations based on solar, wind, geothermal, small and large hydropower, tidal, and other emerging renewable and low carbon energy sources and battery storage, as well as clean cooking fuels and modern cooking technologies. An example of this commitment is the Bank’s Desert to Power program, which aims to build the largest solar zone in the world in the Sahel. The Bank will focus, in particular, on the regional dimensions of energy planning and expanding cross-border transmission networks to harness the scale benefits of integrating regional power markets, especially where the Bank has a comparative advantage. The Bank will continue to assist African countries with national priorities but will add distinctive value at a regional scale by helping African countries plan collectively for and share the benefits of a regional energy security approach. The Bank recognizes that the scale and nature of clean energy transformation required in Africa calls for coordinated and targeted efforts amongst governments, development partners, and commercial banks, and to use financial tools (such as targeted guarantees and risk-mitigation products) to reduce certain risks. The Bank will collaborate with all such entities to evolve and expand such enabling mechanisms. As a reflection, the Bank’s funds for policy-based lending will be directed towards de-risking and subsidizing low-carbon technologies, and away from subsidizing or diminishing the externalities of fossil fuels. The Bank’s investments will support a shift away from reliance on biomass for cooking and heating towards cleaner and more modern cooking fuels and technologies. This is in recognition that over 80% of people in subSaharan Africa still rely on biomass as their primary source of energy and almost 490,000 premature deaths per year are related to household air pollution resulting from the lack of access to clean cooking facilities. Forest degradation, sometimes leading to deforestation, is another serious consequence of the unsustainable harvesting of fuelwood (EIA, 2020). The African Development Bank has announced that it will cease all investment in coal or coal-related technologies and is in the process of revising its energy policy. It will ensure that it does not perpetuate or provide longevity to coal. The Bank will support the development of renewable energy sources and supporting infrastructure, both at the national and regional levels, as part of African countries’ energy transition pathways, with the necessary due diligence and cognizance of avoiding stranded assets in traditional energy sources. The Bank will also provide support to continued research and development and testing of emerging or cuttingedge clean energy solutions to help strengthen the business case for and cost-effectiveness of such newer technologies for consideration in African markets. Universal energy access, energy security, energy affordability, and reducing energy poverty remain continuing imperatives in Africa. • Energy efficiency: investments in technologies and processes that reduce energy intensity or that manage energy demand to enable existing supply to reach more beneficiaries, through applications in residential and commercial buildings, industrial processes, manufacturing, agricultural processing, and cooking methods. This will not extend to efficiency in coal or coal-related technologies. • Urban development: investments in smart, resource-efficient cities such as through low-carbon transport fuels, electric vehicles, promotion of modal shifts, and mass rapid transit schemes. • Industries: investments in technologies and businesses that support circular and circular carbon economy practices, sustainable production and consumption systems, improved waste management through reuse and recycling, and lower energy and resource consumption. • Water systems: investments in technologies and businesses that reduce energy and resource consumption during the process of water extraction, treatment, storage, and distribution. Investments that integrate water and wastewater into the circular economy are key. The African Development Bank will continue to work with African countries to strengthen water systems at the national scale, but will enhance this with a particular focus on regional multi-country water investments, where it has a comparative advantage. It will leverage the advantages of scale and strengthen regional water security as well as sustainable water management and efficiency. • Greenhouse gas information systems and climate services for energy: investments in observation systems and modelling capabilities to allow greenhouse gas emissions to be accurately tracked to source as a basis for effective mitigation measures, and for measuring the effectiveness of mitigation efforts. The road to Paris alignment In Africa
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