On September 2, 2024, the workshop for the launch of the "Greenbook on Promoting Renewable Energy Investment in Africa," organized by the Climate Investment and Finance Committee of the Chinese Society for Environmental Sciences (CIFA) and supported by the World Resources Institute (WRI), was held in Beijing. More than 40 representatives from institutions and enterprises including the China-Africa Development Fund (CADF), Aon-COFCO Insurance Brokers Co., Ltd., China Energy Engineering Overseas Investment Co., Ltd., WRI, and CECEP Hundred Technical Service (Beijing) Co., Ltd. attended the meeting. The participants had in-depth discussions on the challenges and opportunities of renewable energy investment in Africa. The meeting was co-moderated by LIAO Yuan, Deputy Secretary-General of CIFA and LIU Shuang, Acting Director of Finance and Private Sector, the Climate, Economics and Finance Program (CEF) at WRI.

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Dr. SUN Lei from CECEP Hundred Technical Service (Beijing) Co., Ltd. provided a comprehensive interpretation of the core content of the "Greenbook on Promoting Renewable Energy Investment in Africa" (hereinafter referred to as the "Greenbook"), including its background, highlights, major findings, and future outlook. The Greenbook highlights the enormous potential of the African renewable energy market, its currently low development ratio, and the vast market space, emphasizing the significant role of China-Africa cooperation under the Belt and Road Initiative framework. By reviewing mainstream international investment principles and case studies, the Greenbook illustrates the current status and development trends of renewable energy projects in Africa, and proposes recommendations to promote renewable energy investment in Africa, such as formulating favorable policies and regulations, accelerating renewable energy development, and encouraging diverse financing sources. Regarding the future direction of renewable energy investment and financing in Africa, the Greenbook emphasizes the importance of diversified financing channels and methods, including public funds, investment funds, and private capital.

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From Risk to Reward: Enhancing the Bankability of Renewable Energy Projects in Africa

ZHANG Ruiyang, Deputy General Manager, Marketing Department, China-Africa Development Fund

The African renewable energy market holds great potential, but currently faces numerous challenges such as funding shortages and weak infrastructure. Top-level design is crucial in promoting the development of renewable energy in Africa. On one hand, it is suggested to strengthen reforms in the power system and governance to attract more renewable energy projects. On the other hand, enhancing upstream and downstream industry cooperation, optimizing power distribution, and improving renewable energy accommodation capacity is essential. Financial innovation plays a vital role in solving the financing problems of renewable energy projects in Africa. It is hoped that the government, banks, and enterprises will work together to explore a coordinated approach integrating investment, loans, and aid, as well as blending the public finance with private funds, thereby to reduce investment risks and improve project bankability.

ZHANG Lixin, Executive Director, Aon China Global Solutions (ACGS), Aon-COFCO Insurance Brokers Co., Ltd.

In the project development process, risk identification, analysis, and assessment, including country risk, feasibility, technical feasibility, and contractor performance feasibility, are crucial for the implementation of projects. Insurance can serve as an effective risk management and financing tool. With innovative insurance products, risks can be diversified and transferred, reducing investors' risk exposure and improving the bankability of projects. It’s hoped that more financial institutions and enterprises will invest in and develop renewable energy projects in Africa. The development of renewable energy in Africa can be jointly promoted through cooperation and innovation.

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ZHU Ming, International Investment Advisor, China Energy Engineering Overseas Investment Co., Ltd.

Governments need to create an supportive environment to renewable energy development, including formulating effective policies and regulations, providing stable financing support, and strengthening infrastructure construction. Investors need to enhance local cooperation, focus on small yet smart distributed projects, and improve the management capabilities of investment and financing projects. It is essential to promote China's good international engineering practices, new energy transition experiences, and multi-scenario applications into China-Africa cooperation.

Rebekah SHIRLEY, Deputy Chief Representative, World Resources Institute (WRI) Africa

Despite Africa's vast renewable energy potential, its accessibility and demand have far from been met, presenting a situation where significant investment opportunities coexist with practical challenges. High upfront costs and funding costs are major obstacles. It is crucial to reduce developers' costs and increase energy users' payment capabilities. Multilateral banks and private sector innovations, such as liquidity support, credit mechanisms, and de-risking tools, can effectively lower upfront costs and attract more private sector investment. Furthermore, efforts in five critical cooperation areas, including supporting local institution participation, promoting product-end innovation, enhancing market access, strengthening technical cooperation, and advancing data research, can significantly improve the bankability of renewable energy projects in Africa.

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MIAO Hong, Director of the Sustainable Transition Center, WRI Beijing Office concluded the workshop.

In her concluding remarks, she emphasized that Africa, with its young demographic structure and tremendous renewable energy development potential, also faces significant challenges in grid construction and energy supply. Under the global acceleration of green transformation, financing issues are very challenging. China and Africa share common goals and visions in the field of renewable energy, and China-Africa cooperation is a key force in promoting the sustainable development of renewable energy in Africa. All stakeholders should actively join hands, share existing research results and industry-leading practices, and deepen China-Africa cooperation to contribute to opening a new chapter in China-Africa renewable energy cooperation.