As per a recent report by the International Energy Agency, 43% of Africa’s population, primarily in sub-Saharan regions, lacks access to electricity. Enhancing access to a clean, decentralized, and decarbonized energy supply is crucial for the continent’s progress. In this light, a critical examination of efforts to boost Renewable Energy Access in Africa is necessary.
Funding Initiatives for Energy Transition
Numerous countries and organizations are reaffirming their commitment to supporting long-term projects that bolster energy transition and economic stability in Africa. In May 2023, the Africa Finance Corporation and Japan Bank for International Cooperation signed a Memorandum of Understanding for infrastructure projects that accelerate Renewable Energy Access in Africa. Additionally, in 2022, the G7 countries initiated a USD 600 billion lending program, primarily focusing on Africa. The Partnership for Global Infrastructure Initiative aims to fund sustainable projects in developing countries, with Africa as a key beneficiary. Notably, the United States has pledged USD 200 billion over the next five years as part of this initiative, with significant portions allocated for grants, financing, and private sector investments aimed at Renewable Energy Access in Africa.
Cross-Regional Collaboration and Policies
Several international cooperatives, such as the Africa Carbon Markets Initiative, were launched to increase Africa’s participation in voluntary carbon markets. At the 2021 Forum on China-Africa Cooperation, green development was a key component of future plans. The United Arab Emirates is also actively investing in Africa’s energy and infrastructure projects, advancing both continents’ development agendas.
For instance, recent investments in LNG projects in Mozambique, Nigeria, Senegal, and Mauritania emphasize the UAE’s commitment to fostering sustainable trade with Africa. This is further illustrated by the UAE and Kenya’s recent joint statement to negotiate a comprehensive economic partnership agreement (CEPA), aiming to boost non-oil bilateral trade. Egypt’s leadership in launching the Africa Just and Affordable Energy Transition Initiative marks another significant stride. This initiative seeks local strategies to steer African countries away from fossil fuel dependence, emphasizing the Renewable Energy Access in Africa. It includes consolidating technical and policy support to meet universal access by 2030, aligning with the energy demands of Agenda 2063 for the African continent.
Investment and Innovation in Renewable Technologies
The continent’s renewable energy sector faces challenges including limited competitive funding, inadequate utility infrastructure, and the need for progressive energy policies. However, mobile technology and the absence of extensive electricity networks present an opportunity for Africa to leapfrog traditional power models. Private equity funds, notably in South Africa, are investing in independent power producers and companies in the clean energy sector, aiding the Renewable Energy Access in Africa.
Recent data, as per Bloomberg, indicates that clean energy investment in Africa is chiefly seen in South Africa, Egypt, Morocco, and Kenya. These countries collectively received three-quarters of all renewable energy investments, totaling USD 46 billion, in the continent since 2010. The increasing global focus on climate change is spurring more investors to look towards Africa as a viable market for clean energy projects.
Emerging innovations in green hydrogen production, battery storage, and smart power technologies are also poised to transform Africa’s energy landscape. For example, Kenya recently signed an agreement to produce an initial target of 300 MW of green hydrogen, reflecting the continent’s growing ambition.
In conclusion, a host of initiatives focusing on enhancing Renewable Energy Access in Africa aims to enlighten a path for the entire continent, potentially powering the 43% of the African population currently living without electricity. These efforts not only respond to the urgent need for energy access but also align with global commitments to combat climate change and promote sustainable growth.
Feel free to contact the Energy Transition Centre today with questions.
· Julius Moerder, Head of Energy Transition Centre julius.moerder@centurionlg.com
· Oneyka Ojogbo, Head of Energy Transition Centre, Nigeria & West Africa oneyka.ojogbo@centurionlg.com
· Leon van Der Merwe, Head of Energy Transition Centre, South Africa leon.vdmerwe@centurionlg.com
Author: Memoona Tawfiq
