Participating in the carbon market will not only offer Nigeria and Africa the opportunity for growth, industrialization and job creation for its teeming population, but also provide the right incentives for clean energy and climate action, Vice President Yemi Osinbajo, has said.
A statement by the Spokesperson to the Vice President, ‘Laolu Akande, on Saturday, quoted Osinbajo as saying that the Carbon Market pipeline can create about 30 million jobs in the next decade, with the potential to create over 100 million jobs through climate aligned projects by 2050.
The Vice President stated this on Friday in his keynote address at a high-level international meeting on Africa Carbon Market Initiative (ACMI), hosted by the Rockefeller Foundation in New York City, USA., where he stressed the importance of building the carbon markets architecture in Africa.
He said: “Participating in the carbon market offers Africa the opportunity to pursue growth, industrialization, economic value creation, with the right incentives for clean energy and climate action.”
The meeting explored potential opportunities which carbon markets offer to generate resources for clean energy transitions while accelerating economic growth in Nigeria and other African countries.
Recall that an International Steering Committee is driving the activation of the African carbon markets, under the auspices of the African Carbon Market Initiative.
Members of the Committee include the Nigerian Vice President; former President of Colombia, Ivan Duque Marquez; officials of the United Nations; United States Agency for International Development (USAID); and the Gates Foundation among others.
The Federal Government had announced “Nigeria’s commitment to net-zero by 2060 on the basis of a detailed Energy Transition Plan (ETP),” at COP26, and COP27, stressed “the need for more funding for energy transitions and climate action, and why Nigeria is championing the development of the African carbon market initiative.
Against the backdrop of global rapid expansion of the carbon markets, Osinbajo noted that “Africa currently only has a small share of this carbon market, but the current market can be scaled in a massive way – to reach FDI of $120 billion to $200 billion annually.
“For a continent that needs $240 billion dollars annually in mitigation investment alone, this carbon finance stream could be the difference between transitioning and not (transitioning).”
Emphasizing the market’s benefits for the African continent, he said the “combination of capital flows, job creation, and avoidance of long-term climate destruction” are critical drivers of the interest of African leaders in supporting this effort.
…it’s an auspicious moment for Africa to be participating more fully in the global carbon market conversation, especially in the light of the slowing pace of green investment flows into the continent.
Funding challenge
On the challenge of funding, Prof. Osinbajo said: “the investment required to advance the energy transition in Africa is huge. The World Bank estimates suggest that Africa needs $6.5 trillion US dollars between now and 2050 for mitigation action alone to keep temperatures below 2 degrees of warming.”
Lauding the positive Pan-African efforts at developing carbon markets on the continent, the VP noted that the “rapid progress recorded in Africa benefitted from the support of a very engaged Steering Committee with President Duque, the UN, Global Energy Alliance for People and Planet (GEAPP), USAID, and a range of other public and private actors, which resulted in the successful launch in Sharm-el-Sheikh COP-27.
“The strong commitment and presence from fellow African leaders demonstrate the willingness and leadership of Africa. We already have 7 African countries (Burundi, Gabon, Kenya, Malawi, Mozambique, Nigeria and Togo) signed up to develop country carbon activation plans and over $200 million in Advanced Market Commitments – which we must continue to further advance as this is going to be the critical driver of action on the continent.”
He added, “I think it’s an auspicious moment for Africa to be participating more fully in the global carbon market conversation, especially in the light of the slowing pace of green investment flows into the continent.
“The work several of us have done together in the past few months makes it clear that while other sources of flows are slowing down globally, Carbon Markets are growing rapidly.”
Osinbajo called on African leaders to “take responsibility to ensure this exciting momentum is maintained, and scaled up.
“Carbon markets will play a critical role in the implementation of this (Energy Transition) Plan – in mobilizing the capital required to move to our net-zero economy-wide trajectory. I want Nigeria to have the first Carbon Markets Activation Plan.”
“We passed our Climate Change Act, earlier this year, and together with Sustainable Energy for All (SEforALL) and GEAPP have also developed our own net-zero energy transition plan,” he added.
