As the 2024 United Nations Climate Change Conference or Conference of the Parties, more commonly known as COP29, continues to run its course in Baku, Azerbaijan, these four energy players have elaborated on the intention behind their commitment to invest in support of the UN Sustainable Development Goal 7 (UN SDG7). They claim this will create a “positive energy access impact for people in key regions over the coming years,” as the UN SDG7 aims to ensure access to affordable, reliable, sustainable, and modern energy for all.
In a joint statement, the four companies explained: “Despite ongoing efforts, progress towards universal energy access has stalled, particularly amidst recent macroeconomic shocks and rising energy prices. In 2022, the number of people without access to electricity globally increased by around 10 million to 685 million.
“Additionally, approximately 2.1 billion people, primarily in sub-Saharan Africa and Southeast Asia, lack access to clean cooking facilities, disproportionately impacting women and girls who often bear the brunt of domestic responsibilities.”
In light of this, BP, Equinor, Shell, and TotalEnergies have decided to team up to assist in addressing the challenges of energy access with $500 million of committed capital, which is expected to be invested in a broad range of solutions, including solar home systems, mini/metro grids, clean cooking solutions, and enabling technologies, such as e-mobility, energy storage, and management solutions.
Patrick Pouyanné, Chairman and CEO of TotalEnergies, commented: “At TotalEnergies, we are deeply committed to making energy accessible to all. Around a third of our development in electricity in the coming years will be in emerging countries, which will enable about 40 million people to benefit from access to electricity.
“Furthermore, we are committed to investing 400 million dollars in liquefied petroleum gas facilities to develop clean cooking solutions in Africa and India, which will help 100 million people access healthier, more sustainable and more reliable energy. With this new joint initiative with our peers, we are activating another lever to contribute to high-impact local projects to help achieve the United Nations Sustainable Development Goal 7 by 2030.”
The quartet’s shared intent is for the committed capital to support “promising, high-impact projects,” primarily in Sub-Saharan Africa, and South and Southeast Asia in a bid to help millions of people in underserved communities gain access to electricity and improved cooking conditions.
Wael Sawan, CEO of Shell,commented:“We want to support accelerated progress towards universal energy access as we believe it has the power to transform lives. This joint investment will help to do that. By working collectively to overcome key energy access challenges we can achieve sustained impact and drive real change.”
As a result, the investment is perceived to have the potential to support UN SDG 7 over the coming years while also generating co-benefits like job creation and improved health outcomes.
Murray Auchincloss, CEO of BP,commented: “It is early days, but we hope that by jointly investing, we will be able to contribute to wider efforts to tackle the very real challenge of access to energy. Over time, we believe it can help to create a more inclusive energy future for some of the many millions of people who lack that access today.”
The four energy majors have disclosed that a global private equity firm, which is said to have a strong track record in impact investing, will manage the joint investment strategically directed to create social impact and financial returns while engaging with governments, international organizations, financial institutions, the private sector, civil society, and philanthropies. The companies have pointed out that this also entails sharing learnings, providing technical assistance, and addressing market barriers.
Anders Opedal, President and CEO of Equinor,noted:“This joint investment brings together four leading energy companies investing in emerging countries. We believe thiseffort will help close some of the energy access gaps, which is a key part in reaching the global ambition of a just and equitable energy transition.”
These four companies have worked together before. In September 2018, the CEOs of BP, Equinor, Shell and TotalEnergies joined forces to create a collaborative approach to human rights supplier assessments in the energy industry to support the improvement of working conditions in their firms’ supply chains.
The COP29 Business, Investment, and Philanthropy Climate Platform (BIPCP), which was hosted by the COP29 Presidency and the UN Climate Change High-Level Champion Nigar Arpadarai, in collaboration with the Ministry of Economy of the Republic of Azerbaijan and the Export and Investment Promotion Agency of the Republic of Azerbaijan (AZPROMO), led to an announcement from investor groups with over $10 trillion in assets about their intention to unite in developing a shared vision and action plan to accelerate the deployment of private capital into climate markets.
In addition, the Asian Development Bank revealed $3.5 billion of funding for a new program to help counter the impact of melting glaciers, the Azerbaijani banking sector disclosed plans to allocate $1.2 billion for green projects through 2030, and Sweden confirmed its contribution of $730 million to the UN Green Climate Fund.
In collaboration with Egypt, Italy, Germany, Uganda, the United Arab Emirates, and the United Kingdom, the COP29 Presidency has launched the Baku Call on Climate Action for Peace, Relief, and Recovery, aimed at addressing the urgent nexus of climate change, conflict, and humanitarian needs, bringing into partnership a set of Global North and South countries.
This is perceived to create a cooperative platform to facilitate collaboration between national, regional, and international peace and climate initiatives to ensure peace-sensitive climate action and scale up support and finance for the most climate-vulnerable countries, which are also affected by conflicts and high humanitarian needs.