Integration of climate mitigation and resilience in key sectoral strategies

Explanation

The AfDB has specific Climate Finance Tracking guidance documents for transport, water and energy. These documents detail general information on how to track climate finance, what projects are covered, who is responsible, and how the information is reported. Importantly, these documents also detail how mitigation and adaptation is defined for each sector as well as issues that arise in tracking climate finance for each sector.

In terms of resilience and adaptation, AfDB has established the Climate Safeguard System (CSS) to screen projects for vulnerabilities and associated risks with climate change.

Specific climate finance tracking documents do not mean that climate action is integrated across all projects within each sector. The tracking documents are designed to monitor earmarked funding for climate projects in these sectors. AfDB should consider extending these practices to all its sectoral lending, irrespective on whether it is earmarked for climate finance or not.

Energy

The AfDB has an energy strategy which stresses the need for low carbon growth. Furthermore, announcements in 2017 by AfDB have demonstrated that all energy projects were renewable energy, although this is not a general trend as it was reversed the following year. Adaptation is mentioned in the energy sector strategy in reference to helping clients with national or regional adaptation plans.

AfDB’s New Deal on Energy for Africa 2016-2025 draws upon the provision of the Paris Agreement, especially with regards to NDCs. However, the AfDB is assuming only a relative decoupling of emissions from the African energy sector. For the New Deal, the Bank calculates an increase of 55% of emissions against a 78% increase in a business as usual scenario. While Africa does contribute the least to greenhouse gas emissions, it could be expected that a leading MDB, such as the AfDB, would strive for absolute decoupling with zero emission increase. The New Deal Strategy further suggests that  a clean energy sector could enable Africa to ” harness its fossil fuel endowments at reduced carbon budgets.” A Paris aligned strategy should aim to leave most fossil reserves in the ground. The New Deal strategy does, however, promote modern, clean and sustainable energy and supports the delivery of Africa Renewable Energy Initiative (AREI) to achieve 10 GW by 2020 and mobilize an additional 300 GW by 2030.

Transport

While there is a climate finance tracking document dedicated to transport, the Bank’s website on strategy and vision for transport does not specifically mention either climate change or sustainability. The Transport strategy is being updated to reflect the Bank’s High 5 agenda, according to information received from AfDB. Clarification from AfDB on the latest draft of the AfDB transport strategy would be welcome, as we were unable to ascertain which is the most up to date transport strategy.

Water

The AfDB has a vision and strategy for water supply and sanitation, but this does not specifically mention climate change or sustainability. The Bank’s Annual Development Effectiveness report in 2019 mentions that the Bank supports transboundary water management and provides capacity building and protection to key rivers as well as lake basins. It is unclear how climate is taken into account during the design of the infrastructure projects. 

The Water policy is currently under review. This section will be updated following publication of the new policy, which is expected to address climate change.

Cities

The AfDB’s 2011 Urban Development Strategy contains mainstreaming of climate adaptation but nothing on climate mitigation. It even contains a sentence which does not appear to fully take into account the latest climate science at the time, as it states that (emphasis ours) “cities are also among the top producers of greenhouse gases, which are believed to accelerate the global warming”.  

The AfDB is working on a new Urban Development Action Plan and a multi-donor trust fund called the Urban and Municipal Development Fund.

A joint 2019 report published by AfDB, IDB, ADB and EBRD entitled “Creating Liveable Cities” has fully integrated climate mitigation and adaptation within its approach.

Recommendation: Complementary to external tools to evaluate GHG emission reductions and thresholds for individual projects, the Bank should integrate mitigation and adaptation throughout its sectoral strategies, with clear targets, benchmarks and roadmaps for decarbonisation and resilience.