UN funding for African ‘green’ projects

first_img8 March 2010The United Nations Environment Programme (UNEP) has partnered with South Africa’s Standard Bank and the German government’s International Climate Initiative to develop a new carbon project as part of the fight against climate change.The Africa Carbon Asset Development (ACAD) is the first facility dedicated to boosting the African carbon market, and will support continental projects through a combination of technical assistance, grants and preferential access to corporate finance and transactional guidance.ACAD takes a new approach toward capacity and market development, sharing costs and risks with African banks such as Standard Bank to realise and replicate projects.“Huge investments, especially in Africa, will be needed if we are to minimize the effects of climate change,” Sylvie Lemmet, director of UNEP’s Paris-based Division of Technology, Industry and Economics, said in a statement last week.“Government investment alone will not be enough. ACAD is a good example of how we can attract much-needed private capital for investments that address climate change.”Removing investment barriersOne of the key challenges Africa faces is in removing investment barriers to low-carbon sustainable development. Combined with traditional debt or equity finance, carbon finance is a promising means of attracting funding for energy and infrastructure projects; and it is here that ACAD can help.The ACAD partnership couples UNEP’s longstanding capacity building expertise in environmental policy and finance with the financial know-how and regional reach of Standard Bank.“We are keen to bring our global experience on carbon finance back to our roots in Africa and to combine it with the leading technical expertise of UNEP and its Risoe Center,” said Standard Bank Carbon Sales and Trading head Geoff Sinclair.“Our objective is to collaborate with local companies and investors to bring Africa to the forefront of the carbon markets and we look forward to working with everyone to achieve this.”‘Green’ development projectsACAD has recently awarded its first grants to innovative “green” development projects in Kenya, Nigeria and South Africa. These include:The Lake Turkana Wind Power Project in Kenya, one of the largest renewable energy generation projects on the African continent to have achieved financial closure. ACAD will provide partial payment for validation costs under the Clean Development Mechanism – the UN carbon credit scheme;The Lagos Waste Management Authority in Nigeria which is developing several waste-to-energy sites. ACAD is supporting the costs of engineering and carbon auditing studies required to earn carbon credits; andThe Athi River Mining (ARM) Company, which operates a cement plant in Kenya and is attempting to reduce coal consumption in a cement plant by using locally available biomass resources.“As we are continuously working to improve our environmental footprint, Athi River Mining appreciates the technical and financial support provided by the new ACAD Facility to get this project off the ground,” said ARM managing director Pradeep Paunrana.“We will look to the lessons of this project for further energy and cost savings across the company.”SAinfo reporterWould you like to use this article in your publication or on your website? See: Using SAinfo materiallast_img

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