Accelerating financing for green hydrogen projects in Africa
Nouakchott Message calls for development finance institutions and their shareholders to support the African green hydrogen economy
17 April 2023, Nouakchott/Washington DC - Two hundred representatives from African governments, renewable energy and green hydrogen project developers, development finance institutions (DFIs), bilateral partners, and civil society convened in Nouakchott, Mauritania on 13-14 April at the Africa Green Hydrogen Finance Accelerator Forum.
The forum focused on solutions to finance large-scale renewable energy and green hydrogen projects in developing countries and emerging economies.
The forum was organised by the Mauritania Ministry of Petroleum, Mines and Energy and the Africa Green Hydrogen Alliance (AGHA) with the support of the Green Hydrogen Organisation and UN Climate Change High Level Champions. The event was sponsored by the World Bank, the European Investment Bank, bp, CWP Global, Chariot Green Hydrogen and Total Eren.
A November 2022 study by McKinsey on the green hydrogen potential of the six AGHA countries indicates that meeting the green hydrogen ambitions of these leading African countries would require up to USD 55 billion in investment by 2030 and up to USD 900 billion by 2050.
During the meeting, a new report Getting the right blend: Innovative development finance for the large-scale renewable and green hydrogen economy was published which draws on the experiences of a wide group of DFIs, export credit agencies, developers and institutional investors. It looks in detail at what ‘financial close’ for a large-scale renewable energy and green hydrogen project could look like and the most effective financial instruments that should be scaled up.
The forum concluded with the publication of the Nouakchott Message which was delivered by the Mauritanian government to the World Bank and IMF Spring Meetings on 15 April. The Nouakchott Message is a set of recommendations calling on development finance institutions (DFIs) and their shareholders to enable the African green hydrogen economy before it is too late. It is a contribution to the wider Bridgetown Agenda on global financial reform for climate and development.
Quotes from partners and supporters
His Excellency Abdessalam Ould Mohamed Saleh, Mauritania’s Minister of Petroleum, Mines and Energy said: "African countries, especially the countries of the Africa Green Hydrogen Alliance (AGHA), are distinguished by significant potential for renewable energy that qualify them to produce green hydrogen in large quantities at competitive prices. However, transforming this potential into reality requires the mobilisation of large financial resources. The majority of green hydrogen projects that have reached final investment decision are located in industrialised countries, not developing countries, although the potential and energy sources may be greater in developing countries. We need to avoid developing countries being left behind, and we all have a role to play to catalyse investments in green hydrogen projects in Africa."
Jonas Moberg, CEO of the Green Hydrogen Organisation, said: “With massive incentives under the impressive Inflation Reduction Act which should drive down emissions in the United States, there is nevertheless a risk that investments in green hydrogen ecosystems will shift to the US at the expense of emerging and developing economies. Development finance institutions are now more important than ever to ensuring the green hydrogen economy takes off in lower income countries.”
Bogolo Kenewendo, Special Advisor to the UN Climate Change High-Level Champions, and Africa Director at the Climate Champions Team, said: “Many African countries have the natural endowment and technical potential to lead a global green transition in energy and hard to abate sectors. In order to do so, there needs to be concerted public and private finance mobilization efforts that deliver socio economic benefits and a 1.5 degrees pathway. The scale and urgency is unprecedented and African GH2 countries are ready to take on the challenge, in radical collaboration with the international community and other actors in the GH2 value chain."
Felipe Arbelaez, Senior Vice President of Hydrogen and CCS at bp, said: “We believe low carbon hydrogen has a vital role in the energy system by helping to decarbonize hard to abate industries and heavy transport. There is massive potential, and - with many locations with abundant wind and solar energy - Africa could play a leading role. But like any new industry, there are challenges to overcome – and financing is one of them. Green hydrogen will need supportive policies to nurture its growth and encourage investment. And it will be worth it because, as well as providing a reliable source of low carbon energy, the development of a green hydrogen industry in Africa will also create opportunities for the local economies.”
Ramy Lotfy, Chief Commercial Officer, CWP Global, said: “We are on the cusp of a major leap forward towards a global network of massive-scale renewable power and green hydrogen hubs. With the right vision, leadership and international collaboration and support, Africa can put itself on the frontlines of this transformational effort, and fully reap the benefits. As demonstrated by the 30GW AMAN project we are developing in Mauritania, CWP Global is truly committed to helping this new African green energy dream become a reality.”
Adonis Pouroulis CEO of Chariot, which is developing the 10GW Project Nour in Mauritania in partnership with Total Eren, said: “Great progress has been made across the green hydrogen sector over the past two years and there is real momentum within Mauritania to continue on this trajectory. The conference was one of the first events to bring such a range of critical stakeholders together to discuss key issues around financing and reflects the Government of Mauritania’s commitment to championing ongoing development. Partnerships across this industry will be key in delivering these large scale projects and it was great to see such alignment on working collectively to unlock the transformative potential of green hydrogen.”
About the Africa Green Hydrogen Alliance (AGHA)
AGHA is a government-led platform that aims to make the African continent a frontrunner in the race to develop green hydrogen, accelerating the transition from reliance on fossil fuels and shift to new energy technologies that open up access to clean, affordable energy supplies to all. In forming the Alliance, the founding countries Kenya, South Africa, Namibia, Egypt, Morocco, and Mauritania intend to foster collaboration on creating a sustainable enabling environment to supercharge green hydrogen development.
About the Green Hydrogen Organisation (GH2)
Green Hydrogen Organisation (GH2) is a non-profit foundation focused on dramatically accelerating the production and use of sustainable green hydrogen across a range of priority sectors globally. GH2 initiatives include the Green Hydrogen Standard; the Green Hydrogen Charter and country portal; the DFI Green Hydrogen Roundtable; Green Hydrogen Contracting - for People and Planet; the Planning for Climate Commission and the Campaign for 100 million tonnes of Green Hydrogen by 2030.
Joe Williams, Director of Strategy and Communications, GH2, firstname.lastname@example.org / +447775751170
Climate Champions Team, Communications, email@example.com