Michael Liebreich I'd like to start with reviewing these two years since you were last on the show, because they've been incredibly turbulent years in the energy space. What has that done to your missions of energy access? Has it set it back?
Damilola Ogunbiyi So, on the good side, it has allowed people to really look at debt servicing, to consider: what does food security really mean? What does energy security mean? The EU will double the number of renewables that they have between 2022 and 2027, which shows that we can do things at scale, but on the downside, we're not seeing the same thing in the Global South, especially in the developing world. We still probably have about 600 million without access to electricity. It has made it even more important for us to stress that a lot the energy transition cannot happen without energy access. And unlike other countries that are switching from one fuel source to another, in the context of people who don't have energy at all, they just want some energy. And what we're not seeing is the money on the table to help countries really develop; I believe in 2021 only 1.5% of all the money that went into renewables actually went into Sub-Saharan Africa. So, you've got 15% of the world's population only having that level of investment. So, inequality is a real issue, and that's what we're trying to put on the agenda for COP28 in the UAE.
ML Another significant part of your mandate is clean cooking. How are we doing with cooking?
DO What is so sad is just the lack of investment in cooking, and the level of mortality involved. There's probably a million people a year that die from this indoor air pollution, in addition to the climate impact of cutting down trees. It shocks me that we don't think a million people dying every year is an emergency. If things are a crisis, like how we saw with COVID response, then the money is made available, Another reason this is so critical is gender-based violence. In parts of Sudan, women were telling us, I'm going to go out, probably be raped - it's just how it is – on my way to collect fuel wood. So, I get very upset when people go, let's not put in these new technologies, and stop the way of life or the way they enjoy cooking - that is absolute nonsense. There's no woman who wants to walk four to five hours a day, at risk of getting raped, to get fuel wood to come back to spend another five hours trying to cook. But if it is a climate crisis - that we say it is - it is something that we should be able to put together to afford; it will create so many jobs for women within those localities. Technology has moved forward. Is it perfect? Absolutely not. Is the price point perfect? No, but the price point for clean cooking is never going to be perfect if we do not invest a lot of money into it. Last year, there was only $37 million invested in the whole clean cooking sector, right? To drive these technologies, you need about $4 billion a year.
ML You have also been innovating at SEforAll on carbon finance. Can you share what you've been working on?
DO There are three key programs that we're pushing on. The first one is a subsidy program called the Universal Energy Facility. So, put in kind of very crude language, let's say a connection costs $200, but to make it affordable, it really needs to be $70: we provide that $30 for it to be sustainable, and for that business to run. Servicing businesses is important because a lot of people in these communities were saying that if you provide us power where I work, which is where I am for 16, 18 hours a day, I will sort out my home, because I will have disposable income. Number two is the African Carbon Market Initiative, trying to scale up high-integrity African carbon credits, to make sure that Africa is not left behind when everybody's claiming carbon credits. Because it's just not okay for the same tonne of carbon in Rwanda to be sold for $3, and in Europe to be sold for $100. It's just not just. I'm even more excited on the energy side, Michael, because what is our true energy transition, if we think about it? It's diesel and petrol gen-sets, right? Most of them can have some solar plus storage solution, and they are high-integrity, because it's either there or it's not. It's actually one of the easiest thing to verify as well. And the last one is something called REMI, which is the Renewable Energy Manufacturing Initiative. We asked the question, how do we make Africa a production hub, instead of just an extractive continent? In Nigeria, people mine lithium, send it to China, and then bring it back 100 times the cost; that's just what we're used to, that's life. We're like, no, how do we change that? And then in the African sense, how do we actually sell and trade to ourselves? If there are key off-takers, and there's money to be made, and there are jobs to be created; these are the things that really make the building blocks for the energy transition that we don't really hear about in a lot of these public statements.
ML On that transition: if you really want 24/7 power quality like they have in Northern Europe, then you've got to do something to keep the lights on when it's not sunny and not windy. Is it OK in your mind to develop gas projects to keep the lights on in those situations?
DO This conversation has been going on really intensely for the last three years - what fuel source should be used, what should be used for baseload, for industry- and I have been trying very hard to change the conversation. The conversation shouldn't just be about the fuel source. I think the conversation needs to be the one we were having prior, about what does it take to fund the energy transition? And not just the generation part: the distribution, the network, the policies. The energy transition that we're asking these countries to do is a transition of their entire economy. Debating only the fuel source doesn't allow us to have those conversations. We have to understand that at the heart of everything, we do have to get to a point of net-zero. We do know that this is affecting the climate crisis. So, the cleaner, more sustainable we do it… But for me, the stuff that's more scary is: how is it going to be funded? These are the conversations we should be having. You need to make sure that the entire energy transition, and not just the generation and fuel source, is at the top of mind.
ML The problem is that financial institutions in developed countries, and the multilaterals, don't want to fund the fossil piece; they all want to pick out the plums of the nice wind farm and the solar and the micro-grid…
DO I disagree with the fact that they're funding anything. We're not having the same conversation. If you bring $100 billion to the continent for renewables, we will do renewables - just bring money. When you come and say, it has to have a perfect PPA, with a sovereign guarantee and everything in place, and it's taking years.... That's why I say you have to fund the transition - fund any part of it, but fund something! They’re funding very, very select projects that don't have the impact that we're talking about. What is happening is you're using a conversation of no fossil / fossil to fund nothing. If you're saying we don't want to fund any fossil, perfect, no problem. But can you bring a few billion to fund something else? No one's going to have a problem with that. Everyone goes, oh, there's so much money for renewables: there's not. Barely four African countries can get funding for renewables out of over 50. The number one agenda must be to get people out of energy poverty. Where's the money to get someone out of poverty? Where's the money to reduce the infant mortality rate? Where's the money for women not to be dying because they're using clean cooking? We can't keep having these debates that don't get to the crux of it, which is: if you look at the money that's going in to Africa, 1.5% of all renewable investment? It's absurd, it is embarrassing. So, while you're having whatever fights you're having, at least fight for more to be coming in, and we will know how to utilize that. Bring the Africans into the conversation; I don't represent all of Africa, I represent the United Nations. They are the ones who know what is best for them, instead of this assumption that everybody else knows what's best for them. Listen to what their priorities are, and fit their priorities into climate targets - not the other way around.