Abu Dhabi, United Arab Emirates, 11 May 2023: Emirates Development Bank (“EDB” or “the Bank”), the key financial engine of UAE economic development and industrial advancement, has joined the Alliance for Industry Decarbonization (AFID), which aims to decarbonize industrial value chains and accelerate net-zero ambitions in accordance with the tenets of the Paris Agreement on climate change.
The announcement was made today on the sidelines of UAE CLIMATE TECH, the nation’s first-ever decarbonization technology conference, hosted by The UAE Ministry of Industry in partnership with ADNOC and Abu Dhabi Future Energy Company (Masdar).
Joining the global action group underlines the Bank’s commitment to contribute to national and global efforts to decarbonize and cut industry emissions. EDB has recently refreshed this commitment by maximizing support to renewables, as one of its five key focus sectors for finance, which now encompasses renewables, manufacturing, technology, healthcare and food security. The Bank has a mandate to deploy AED30 billion in financing support to 13,500 companies within these sectors by 2026.
As a member of the Alliance, EDB will showcase its flexible financial solutions to support companies operating within the Renewables sector as well as its development banking capabilities driving a just and equitable energy transition. For investments in alternative or renewable energy, or businesses shifting to clean and renewable energy sources in the UAE, the Bank offers up to 100 percent financing of the project value with a maximum tenor of 15 years and a two-year grace period.”
AFID’s founders and partners, comprising private and public organizations and stakeholders operating in energy-intensive sectors, have all committed to collaborate toward the common vision of a green future. Alliance members believe in the power of partnerships based on honest dialogue and concrete actions.
Ahmed Mohamed Al Naqbi, Chief Executive Officer of Emirates Development Bank, said: “We recognize the importance of investment in renewable and clean energy technologies to achieve net zero emissions by 2050. The UAE’s national development plans, which align with the UN Sustainable Development Goals (SDGs), are at the forefront of our commitment. Joining the Alliance presents an efficient and effective way for EDB to enhance its role in achieving these ambitions. We are fully dedicated to scaling up our finance solutions, deploying significant resources, and stimulating innovation to support the transition to cleaner sources of energy and deeply cut industrial emissions. Together, we can make substantial progress towards the UAE’s sustainable economic development and create a greener future for all.”
Abu Dhabi-headquartered International Renewable Energy Agency (IRENA) coordinates and facilitates the activities of the Alliance for Industry Decarbonization based on its experience in hosting multi-stakeholder platforms.
Gauri Singh, Deputy Director General of IRENAI, said: “We are delighted to have Emirates Development Bank join the Alliance for Industry Decarbonization. According to IRENA’s recent World Energy Transition Outlook 2023 Preview, cumulative investments between now and 2030 need to total USD 44 trillion, with energy transition technologies representing 80% of the investment, or USD 35 trillion. Total cumulative energy sector investments in the Planned Energy Scenario until 2030 are USD 29 trillion. An additional cumulative investment of USD 15 trillion – or an annual average investment of USD 1.9 trillion – would be needed in the 1.5°C Scenario until 2030. We believe EDB will play a critical role in accelerating the UAE’s green efforts by providing financing for the much-needed renewables and energy efficiency projects.”
The mission of the Alliance is to foster action for decarbonization of industrial value chains, promote understanding of renewables-based solutions and their adoption by industry with a view to contributing to country-specific net-zero goals.
The growing number of members highlights the need for an international, multi-stakeholder platform that enables exchange and collaboration to tackle the decarbonization of the industrial sector.
EDB offers a patient debt approach with an emphasis on developmental impact. The Bank’s direct and indirect financing is offered with long tenors, higher loan-to-value ratios, lower rates and interest grace periods.