Access to Modern Fuel to Cost Africa $7.5bn, Say Refiners

The African Refiners and Distributors Association (ARDA) has said it will cost the continent about $7.5 billion to exit the use of outdated fuel sources like firewood and charcoal and embrace modern, cleaner energy.

ARDA which made the disclosure at a recent virtual sustainable financing workshop, noted that there was need to harmonise fuel specifications as well as Environment, Social, Governance (ESG) considerations to reduce the looming public health and environmental impacts on Africa’s citizens.

Between now and 2030, the group noted that the $7.5 billion investment, inclusive of debt, equity and grants, would be required to build clean cooking stoves and downstream infrastructure that would support the attainment of the United Nations Sustainable Development Goals (SDGs). Executive Secretary of ARDA, Anibor Kragha, who spoke during the event, noted that with the growing pressure against fossil fuels, African countries must deploy measures to secure the needed financing to develop and add value to its hydrocarbon resources.

The International Energy Agency (IEA) had in a report insisted that achieving net- zero emissions by 2050 would require complete transformation of the global energy system and called for a total halt of investments for upstream oil development.

As a first step, Kragha said ARDA and Aldersmead, an EUbased corporate finance advisory firm, have presented a jointlyprepared resource mobilisation plan to support implementation of the Africa clean fuels roadmap.

The plan also contains near-term framework arrangements with traditional and alternative funding counterparties and a longer-term ARDA Credit/Investment Fund whereby ARDA members can benefit from credit advanced from the fund.