Africa’s Perfect Energy Cocktail for Power Sufficiency

For Africa to become energy sufficient, it needs to explore all its options to cater to the needs of its 1.3B people.

One of the major roadblocks that have thwarted economic productivity and growth in Africa has been gaping energy deficits.

Another of Africa’s paradoxes, that whilst the continent is endowed with numerous abundant resources for power generation, it has barely benefited from this advantage. Over 640 million Africans have no access to energy, corresponding to an electricity access rate for African countries at just over 40 per cent. This is the lowest in the world, according to the African Development Bank (AfDB).

Additionally, 900 Africans million lack access to clean cooking facilities. According to the World Health Organization (WHO), only 28 per cent of health facilities in Sub-Saharan Africa have access to affordable and reliable power.

A report by the AfDB indicates that insufficient energy access manifests itself in innumerable ways. It handicaps the operations of hospitals, compromises educational attainment and drives up the cost of doing business on the continent. Conversely, energy access for all is one of the key drivers of inclusive growth as it unlocks economic potential and creates jobs both in rural and urban areas.

The crisis has further been aggravated by the Russian-Ukraine conflict, which has disrupted global energy supply chains and Africa has not been left unscathed.

Inarguably energy is at the core of Africa’s development to drive industrialization and upgrade critical sectors such as health, education, infrastructure and manufacturing. African countries have been striving to address this ‘energy trilemma’, exploring all options to find balance between security, affordability and sustainability; whilst seeking to build a sustainable market across the continent.

Just how can Africa rise up to seal these massive deficits and become energy sufficient in order to steer economic growth?

Being extremely vulnerable to the adverse effects of climate change, Africa has come under pressure to make a green transition by fully adopting renewable sources. Fossil fuels including oil, coal, and natural gas still supply about 80% of the world’s energy. So how can Africa with its massive energy gap just flip a switch and unplug fossil fuels as a key energy source? Undoubtedly, gas needs to be part of Africa’s just energy transition to ensure that its 54 economies are not jeopardized at the expense of energy sustainability.

For Africa to become energy sufficient, it needs to explore all its options to cater to the needs of its 1.3B people. The AU adopted the ‘African Common Position on Energy Access and Just Transition,’ during the 41st Ordinary Session of the Executive Council. This is a comprehensive approach that charts Africa’s short, medium, and long-term energy development pathways to accelerate universal energy access and transition without compromising its development imperatives.

In addition, it stipulates that Africa will continue to deploy all forms of its abundant energy resources, including renewables and non-renewables energy to address demand. Natural gas, green and low carbon hydrogen and nuclear energy, will therefore be expected to play a crucial role in expanding modern energy access in the short to medium term. In the long-term, the uptake of renewables will be enhanced for low carbon and climate resilient trajectory. Into the bargain, AfDB prioritizes renewable energy but acknowledges that fossil fuels will remain an important part of the overall energy mix, as is the case with several developed economies. In response the Bank is financing state of the art technology to minimize emissions.

A key ongoing initiative that has been attempting to seal this gap, is the AfDB’s ‘Light up Africa,’ listed among the strategic priority areas of its ‘High 5s’ initiative, to help the continent achieve universal electricity access by 2025. Power Africa which collaborates with African governments and the private sector is another critical initiative. It aims to expand access to electricity to health facilities across the region. It’s an American initiative that was launched in 2013 by the then incumbent US President Barack Obama in Tanzania. It aims to support economic growth and development by increasing access to reliable, affordable and sustainable power in Africa.

The Power Africa Off-Grid Project has awarded US$3,070,650 in grant funding, to electrify more than 250 health facilities in ten countries in Sub-Saharan Africa. In October 2021, Power Africa transferred US$500,000 of Maternal Child Health funding, to electrify seven large health facilities in Uganda and Malawi using solar energy installations. During the 2021 UN High-level Dialogue on Energy, Power Africa joined more than a dozen organizations to launch a Multilateral Energy Compact for Health Facility Electrification; with a goal to electrify 25,000 health facilities with clean and reliable power solutions by 2025.

To boot, the World Bank project dubbed, ‘Lighting Africa Programme’, which is part of the Bank’s ‘Sustainable Energy for All’ initiative, a mandate to bring energy to the planet by 2030; has seen 32 million Africans gain access to energy, often through off-grid solar products. Similarly, the bank has supported solar projects and programmes in other countries in West Africa and the Sahel region including Burkina Faso, Togo, Guinea, CAR, Sierra Leone, Niger, Mali, Mauritania, Chad, Cameroon, Cote d’Ivoire, Gambia, and Senegal among others.

During the recent Africa Energy Week (AEW) held under the theme, ‘Exploring and Investing in Africa’s Energy Future while Driving an Enabling Environment’ in South Africa, Team Energy Africa launched the Africa Energy Market Dashboard. The chief objective of the dashboard is to provide energy financiers and developers with access to how African energy investments are being utilized.

The New Deal on Energy for Africa by AfDB, is built on five inter-related and mutually reinforcing principles which include, raising aspirations to solve Africa’s energy challenges; mobilizing domestic and international capital for innovative financing in Africa’s energy sector; supporting African governments in strengthening energy policy, regulation and sector governance; establishing a transformative partnership on energy for Africa and increasing the Bank’s investments in energy and climate financing.

  • Attaining Africa’s energy sufficiency via non-renewables

Harnessing the power of non-renewables is one path that Africa should continue to pursue in order to attain energy security and realize its developmental goals. The ongoing Russia-Ukraine war has put African oil and gas on the global map. The conflict has disrupted energy supply chains across the world and in tandem they have been seeking alternative sources of energy. Europe has especially borne the brunt of its reliance on Russian gas, and has been keen to break this dependence. Consequently, oil and gas producing countries have come under EUs radar. Stalled gas projects have been reopened and the once so -called ‘risky’ investments have been flowing, to facilitate gas production to seal the gaps in the global energy market. New pipelines are being developed, whilst some ageing ones are being revamped to export oil and gas. Italy signed a US$4 billion gas deal with Algeria in July, a month after Egypt reached an agreement with the European Union and Israel to boost sales of LNG. Angola also has signed a gas deal with Italy.

According to a recent Rystad Energy report, African nations are well placed to scale up their exports in gas supplies to Europe. Moreover, it indicates that Africa is likely to reach peak gas production capacity by 2030; at 470Bcm, 75% of Russia’s 2022 production capacity. Africa’s oil and natural gas-producing countries such as Mozambique, Nigeria, Libya, Egypt, Cameroon, DRC, Angola, Namibia, Algeria, Ghana, Gabon, Mozambique, Equatorial Guinea among others; have an invaluable window of opportunity, to contribute largely to the global energy landscape. Given that Africa is already in possession of existing pipelines connected with the wider European gas grid, across the Mediterranean, the traditional oil and gas suppliers in the continent have an upper hand in tapping into European markets, and well poised to scale up their exports. Pipeline exports to Europe from Africa run through Algeria into Spain and from Libya into Italy.

Some key ongoing projects include the Greater Tortue Ahmeyim (GTA) LNG project offshore Mauritania and Senegal whose production is set for 2023,with the GTA LNG cargo targeted for 2024.Between 2014 and 2017,an estimated 15 trillion cubic feet of gas were found in the waters of the two West African nations. The region is a future hub of world LNG production. The figures indicate that production can continue for at least thirty years. Mozambique is bound to become a major LNG exporter. Eni an Italian firm established a platform in the Indian Ocean offshore, away from the violence in Cabo Delgado, making it the first floating facility in the deep waters off Africa, with gas liquefaction capacity of 3.4 million tons per year. According to Africa Energy, the platform is already operational.

The proposed construction of the Nigeria-Morocco Gas Pipeline (NMGP) touted as vital for the economic integration of both the West and North Africa, is on course. Both heads of state of Morocco and Nigeria, renewed their commitment to proceed with the construction. The project is a regional onshore and offshore gas pipeline which is projected to transport natural gas resources along the Atlantic Coast, traversing the maritime areas of 15 West and North African countries, and crossing over to Europe. The 5,660-kilometer-long pipeline will ferry Nigerian gas to every West African coastline, ending at Tangiers in Morocco and Cadiz in Spain. It’s an extension of the already existing West African Gas Pipeline (WAGP), which has been pumping gas from Nigeria to Ghana, Benin and Togo since 2010.

The construction of three multinational oil and gas pipeline systems measuring over 6,500km, is an effort to revolutionize energy access by boosting oil and gas supply. The network will be shared by Equatorial Guinea, Cameroon. Chad, DRC and Angola. Into the bargain, the network is projected to comprise of at least three refineries and gas-fired power plants, liquefied natural gas terminals and storage depots. The East African Crude Oil Pipeline (EACOP), is another planned 1,443 km pipeline that is expected to be built between oil fields in western Uganda, to the port of Tanga in Tanzania.

The global demand for thermal coal, especially from Asian and European markets has risen. Most countries in both regions having been dependent of Russia, as the country is the world’s third largest supplier of thermal coal used chiefly for power generation. Coal is an energy source that has been frowned upon, for being a major polluting fossil fuel and contributor to climate change. Coal plants that had been scheduled for closure in Europe have been reopened, to fill the deficit in mitigating fuel costs and generating electricity; as the alternative gas, is inarguably more costly.

The African coal market is projected to enjoy double its revenue for the next one year. The prevailing energy gap has created a window of opportunity for African coal-producing nations. These countries have doubled profit margins, with the surge in demand from European buyers. Italy, France, Portugal and Spain have been sourcing from Nigeria, whilst Germany has sought Senegal for gas supplies. According to a report by Reuters, South Africa’s coal exports rose by 11 folds in the months following the war. Botswana has also projected growth in its coal market. The massive demand far outstrips the available supply, resulting into prices of thermal coal leaping to record levels. Therefore, non-renewables are crucial in attaining energy sufficiency in Africa which will spur development.

  • Achieving Africa’s energy adequacy through renewables

Wind power is quickly gaining ground in Africa and many African countries are exploring this energy source to meet a fraction of their energy needs. Both onshore and offshore wind power is capable of delivering lower-cost power, as opposed to fossil fuels. A recent report commissioned by the International Finance Corporation (IFC), on ‘Wind Energy; Joining Forces for an African Lift-Off,’ indicated that Africa has 59,000 GW of technical onshore and offshore wind potential, which is enough to meet the continent’s energy demand 250 times over.

The Global Wind Energy Council (GWEC) notes that Africa is only using 0.01 per cent, of the 59,000 GW. In late 2021, GWEC, with support from numerous entities such as International Energy Agency (IEA), the International Renewable Energy Agency (IRENA), IEA, IFC; launched Africa Wind Power (AWP); a regional body representing the wind industry, with a goal to scale up and accelerate wind projects across the continent. Wind power markets in Africa include South Africa, Morocco, Egypt, Kenya and Ethiopia.

Africa boasts vast hydroelectric power (HEP) resources, with immense potential for increased power generation to power the continent. South Africa takes the lead, generating 45 per cent of the continent’s production, North African countries follow suit at 30 per cent, whilst the rest of the continent cumulatively take up 25 per cent. Cameroon, Guinea, DRC, Sudan, Mozambique and Angola, have noteworthy HEP resources, of which currently only 7 per cent are developed.

Africa possesses vast untapped geothermal potential, which if explored could be largely among the renewable solutions Africa needs, to solve the power shortage quagmire. The continent’s geothermal potential is said to be in the Great Rift Valley, a geologically active area known to have over thirty active volcanoes and numerous hot springs, extending from Djibouti to Mozambique. Currently, Kenya is the largest geothermal producer in Africa, with an installed capacity of 863MW and ranks ninth in the world, with power production contributing to over 40 per cent of the country’s electricity generation.

Solar energy has been revolutionary for many users in Africa, with countries across the continent reaping socio-economic benefits pertinently from off-grid electricity, which has been swiftly gaining momentum, with the market growing rapidly. According to GOGLA, the off-grid solar association, in the second half of 2019, 2.43M units of off-grid solar products were sold in East Africa alone. Solar renewable energy is highly recommended to combat climate change as it is carbon free.

Africa’s green hydrogen sector is growing steadily and could soon be exporting green hydrogen, to meet rising demand in Europe among other markets. Presently, various projects are underway albeit in the early stages of development. Mauritania, Egypt, Morocco, South Africa, Niger and Namibia, have set up plans for hydrogen production facilities. For instance, Egypt has at least five green hydrogen projects in the pipeline, one is feedstock for the production of green ammonia.

Renewables are the best option for Africa but on their own, they cannot sustain Africa’s energy demands at present. Consequently, what Africa needs is to blend both of the sources, a somewhat ‘energy cocktail’ if you may to achieve energy security and suffiency.

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