Senegal seals 2.5 bln euro investment deal to help renewable energy push

The agreement last year to help Indonesia shut coal power plants was the biggest so far, at $20 billion. "The current global financing system is not adequate," Sall, who also bemoaned the cost of credit said, calling on multi-lateral development banks to take into consideration current issues such as climate change and the high debts of low-income countries.

A coalition of countries will provide 2.5 billion euros ($2.74 billion) to Senegal to help it achieve its target of 40% of installed capacity from renewable energies by 2030, President Macky Sall said on Thursday. "We think that if this is mobilised we can achieve, if not exceed this objective," Sall said at the Summit for a New Global Financial Pact in Paris, adding that renewable energy currently accounts for 31% of capacity. The Senegal Just Energy Transition Partnership (JETP) was backed by France, Germany, the European Union, the United Kingdom and Canada and a draft investment plan will be finalised within 12 months, according to a statement.

"To accelerate the deployment of renewable energies, international partners and multilateral development banks will mobilise 2.5 billion euros in new and additional financing over an initial period of three to five years, starting in 2023," the statement said, adding that more financing may be mobilised during and beyond this period to support Senegal's ambitions. The agreement with Senegal is the fourth such JETP and follows deals with Indonesia, Vietnam and South Africa struck since 2021. The JETP with Senegal was being negotiated at the UN COP27 climate summit held in Egypt in November last year.

The model has emerged as a key mechanism for getting public and private finance mobilised to help countries shift away from fossil fuels as pressure grows on rich, heavy emitting nations to help poorer countries with climate change and the transition to cleaner energy. The agreement last year to help Indonesia shut coal power plants was the biggest so far, at $20 billion.

"The current global financing system is not adequate," Sall, who also bemoaned the cost of credit said, calling on multi-lateral development banks to take into consideration current issues such as climate change and the high debts of low-income countries. ($1 = 0.9112 euros)