1. Why and where to invest in Africa’s climate ecosystem

Are you looking for a punchy summary of how Africa can grow economically while playing a significant (and profitable) role in the planet’s green transition?

• Most of the facts below were aired at the Africa Climate Tech Summit this week. 

• Thanks to Cap-A, Dalberg Research, Catalyst Fund and Nairobi Climate Network. 

The basic premise: “Climate-positive growth” can take Africa to middle-income status by lowering emissions globally while creating new jobs and cash locally. 

• Preventing a climate catastrophe and realising growth were long assumed to be irreconcilable, suggesting sustained African poverty.

• But here is how experts think Africa can become well-to-do AND do well by the planet.

Africa in the global concert: Rich countries will pay the continent to focus on carbon. Why?

• Net-zero by 2050 is unlikely... unless poor countries provide big net-negative emissions.

• Rich countries are stuck in existing structures that mean they won't reach net-zero. 

Early evidence: Climate tech start-ups in Africa raised more than $1 billion in 2023.

• A third of venture capital coming to the continent now goes to climate companies. 

• Energy and water take the lion share but agri ideas hog the early-stage pipeline. 

Economic assets: Africa has three engines driving climate-positive growth.

• Adopting green tech to satisfy the continent's own demand for goods and services without increasing its carbon footprint.

• Adjusting local land use and ecosystem management, while applying engineered carbon removal technologies.

• Creating green manufacturing on the continent, using abundant renewable energy, to replace polluting industries in the Global North.

The likely result: Lower emissions globally AND more jobs locally.

The main driver: Renewable energy to power such climate-positive growth.

• Africa’s potential is 50 times the world’s estimated electricity demand by 2040.

Prime example: Solar PV in Kenya vastly outperforms Europe’s industrial centres.

• The same battery-supported PV system in Kenya will enable a base load that is 10 times that in Germany.

Industrial potential: Abundant renewable energy makes it possible to move production to Africa, especially the processing of raw minerals extracted on the continent.

• Locally smelting African bauxite would reduce global emissions by 335 million tonnes per year (about 1% of the total), creating 280,000 jobs and $37 billion in revenue (more than Zimbabwe’s entire GDP).

• Locally smelting African iron ore reduces emissions by up to 110 m tonnes/year, creating 215,000 jobs.

Leaping ahead: Emerging technology supports African green hydrogen production — running on seawater.

• This eliminates concern about water stress, and increases energy use by only 5%.

• Green hydrogen is a highly versatile industrial product suitable for direct export, green energy, industrial feedstock, fuel synthesis, green fertiliser, green steel, green chemical and green plastics production.

What if we don't do this? Climate change threatens Africa’s development and stability.

• Global warming will reduce African GDP by up to 15% per year by 2030.

• Limited buffer capacity means the poorest (and likeliest migrants) are hardest hit. 

• Growing Africa the standard way (like Asia) would create huge emissions growth.

2. Innovation frontier: Who is building what

Entrepreneurs this week pitched on the main stage and in the margins of the Africa Climate Tech Summit in Nairobi. Here is a selection: 

• Floodbase: Helps insurance companies better assess prices in response to catastrophic flood risk.

• Meridia: A geospatial data company providing field data solutions for smallholder supply chains.

• Complete Farmer: A Ghanaian startup boosting agri revenue. 

• Tolbi: A satellite data and analytics solution supporting climate-smart agri practices.

• Oko: An agricultural microinsurance provider for climate-vulnerable smallholders.

• Open Forest Protocol: A monitoring, reporting and verification solution for carbon offset projects.

• Cinch Markets: Aggregating land to unlock productivity and sustainability.

• PeerCarbon: A SaaS platform providing access to software, free tools and resources for sustainability and transitions.

• Node Bio: Providing biological crop treatments, making African agriculture more resilient, productive and sustainable.

• Earth Acre: Carbon farming solutions, mitigating climate change and biodiversity collapse with community knowledge and technology.

… is what Spain is offering to Mauritania for green hydrogen projects: A significant investment in renewable energy fostering cross-border cooperation. If Mauritania can indeed pull it off.

5. Q&A: Climate leaders with answers

Sidee Dlamini is the director for talent & strategic partnerships at Delta40, a VC investor & venture studio in Nairobi with a strong climate mandate. 

Q: How is it going? A: We launched less than a year ago and already have 11 portfolio companies!

Q: What are you excited about right now? A: Giraffe Bioenergy, a cassava-to-ethanol cooking fuel company. We are the lead investor, which is a key part of our model. Often finding the lead is the hardest part for startups.

Q: What advice do you give entrepreneurs? A: Solve a big problem. Don’t be a nice-to-have.

Q: What is the biggest challenge in the next decade? A: We need to prioritise ways for farmers to adapt. The continent is taking the biggest brunt in climate change. Where I come from in Swaziland, temperatures reached an all time high, right after a huge storm that destroyed hundreds of houses.

Q: Are there enough teams working on solutions? A: We are struggling a lot with climate experience, and how to expand the talent pool. We need people who understand impact but also sectors like agriculture and cookstoves.

6. Media monitoring

• Ambitious ideas: Mozambique unveils plans to lead Africa in green energy.

• Green bond: IFC and SIMA launch a $150 million facility for African solar developers.

• Power cooperation: The World Bank commits nearly $300 million to the Trade and Development Bank for access to sustainable energy in Africa

• Moving forward: The AfDB approves a stake of up to $10 million in the Alliance for Green Infrastructure. 

• Swiss move: The Klik Foundation will invest $850 million in carbon projects in Ghana.

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Thanks to the Green Rising team for putting this together.