Although Africa accounts for only 4% of global greenhouse gas emissions (without LULUCF), climate change affects the continent disproportionately. It poses a significant threat to the continent’s human well-being and development.
However, it is worth noting that climate change mitigation and adaptation efforts also offer opportunities for countries and organisations. Indeed, countries will need to adopt low-emission energy sources, develop new products and services, and maximise new policies that subsidise efficiency and clean energy throughout the supply chain.
In Africa, countries will accelerate electrification rate through renewable energies while identifying opportunities in hydrogen.
Mckinsey has identified several opportunities for Africa to pursue to build new green businesses on the continent.
These are prioritised out of a list of nearly 40, based on economic potential as well as a feasibility to adopt them in Africa. Some of them are presented below
- Green hydrogen: Africa has the best solar energy in the world and the continent can be very competitive to produce and export hydrogen to Europe using solar. A recent analysis confirms Africa’s extraordinary potential for green hydrogen, valued at €1 trillion.
- Clean and transition metals. The demand for battery metals is expected to increase 5 to 24 times by 2030 and Africa has significant deposits of some of these metals, including cobalt, lithium and manganese.
- Other opportunities are businesses to support Africa’s own energy transition, including solar and wind turbine manufacturing, assembly of electric vehicles and production of bio ethanol.
However, all this will require funding. For mitigation alone, Africa will need $6.5 trillion by 2050. That’s almost $220 million a year. In addition, it will need significant funding for adaptation. Although there are different figures for adaptation, this figure could be almost as high as that for mitigation. The world in 2009 pledged over $100 billion annually towards adaptation but very little of has actually come through, especially for Africa so the continent need to find financing vehicle tackle the issue.