Africa’s carbon markets to play critical role in  implementation of energy transition plan, says Osinbajo

By Innocent Obasi

Yemi Osinbajo, Nigeria’s vice president, has said the Africa Carbon Market Initiative (ACMI) will be essential to the success of the Energy Transition Plan in mobilising the capital required to move to Africa’s net-zero economy-wide trajectory.

Osinbajo said this while delivering his keynote speech at the Rockefeller Foundation meeting held recently in New York.

The Vice President highlighted the key factors influencing African leaders’ interest in supporting this initiative as being a combination of capital flows, job creation, and avoidance of long-term climate destruction.

He said that Africa’s current share of the carbon market is quite small. He, therefore, offered an insight of the significance of the projected carbon finance stream by saying:

 According to Osibanjo, for a continent that needs $240 billion annually in mitigation investment alone, the carbon finance stream could be the difference between ‘transitioning and not transitioning’.

“As all of us in this room understand well, the priorities of the African continent are not just to act decisively on the climate crisis, but to also create significant growth opportunities for our young and growing population.

“The investment required to advance the energy transition in Africa is huge. World Bank estimates suggest that Africa needs $6.5 trillion US dollars between now and 2050 for mitigation action alone to keep temperatures below two degrees of warming,” he said.

Additionally, Osinbajo emphasised that the carbon market pipeline had the ability to generate 30 million jobs in the next decade, with the potential to generate over 100 million jobs through climate-aligned projects by the year 2050.

Osinbajo also pointed out that the rapid advancements made in Africa were made possible by a very active Steering Committee that included the United Nations, the Global Energy Alliance for People and Planet (GEAPP), USAID, and a number of other public and private actors.

“As a result, the African Carbon Markets initiative (ACMI) was successfully launched in Sharm el-Sheikh, Egypt, during the COP-27 conference,” he said.

The vice president also talked about the importance of partnerships in strengthening carbon markets on the continent. He stated that the key to unlocking opportunities in Africa’s carbon markets was through partnership.

He noted that one of the strong points of ACMI and the way it must be structured going forward, in terms of governance, is the flexibility to smoothly work with other initiatives.

“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,” he added.