According to the "Renewable Energy 2022" report recently released by the International Energy Agency (IEA), with the rapid popularization of renewable energy around the world, it is expected that the global installed capacity of renewable energy will increase by 2400GW between 2022 and 2027, equivalent to The current total installed electricity capacity in China.
In addition, in the next five years, renewable energy will account for more than 90% of the global electricity expansion, and the global increase in renewable energy generation in the next five years will be equivalent to the increase in power generation in the past two decades. By 2025, renewable energy will overtake coal as the world's largest source of electricity.
The Western world, made up of developed countries, has reached peak energy use, while developing regions such as India, China, Southeast Asia and Middle Eastern countries are catching up at a considerable rate. Developed and developing countries are going all out to transform to clean energy such as solar energy, wind energy, and hydropower.
What is the state of renewable energy on the resource-rich African continent today, when renewable energy is widely adopted? This article provides a brief overview of the progress made by African countries in renewable energy and the potential of the continent for a green energy transition.
What is Africa's renewable energy potential?
An energy system with renewable energy at its core can help address the many social, economic, health and environmental challenges facing Africa. The African continent has enormous resource potential in wind, solar, hydro and geothermal energy. In addition, falling costs have made renewable energy increasingly accessible. Central and southern Africa is rich in mineral resources that are vital for the production of batteries, wind turbines and other low-carbon technologies.
Africa is the sunniest region in the world, with about 60% of the world's best solar resources. The International Renewable Energy Agency's African Renewable Energy Market Analysis report states that the continent has a potential of 7,900GW of solar photovoltaic technology. In addition, the continent has additional hydropower potential (1753GW) and wind power potential (461GW). Parts of Africa also have geothermal and modern bioenergy potential.
It is estimated that by 2050, solar photovoltaic power generation will increase to 650GW, and the African continent is expected to become a global green manufacturing center in about 20 years.
In addition, the energy transition will also create job opportunities by promoting the development of new industries. According to an analysis by the International Renewable Energy Agency, renewable energy and other energy transition-related technologies have already created 1.9 million jobs in Africa, and this number will grow significantly as countries invest further in the energy transition.
According to reports, between 2020 and 2050, every million dollars invested in renewable energy will create at least 26 job years; every million dollars invested in energy efficiency will create at least 22 job years; in terms of energy flexibility, the figure is 18 .
According to a 2021 report by the International Energy Agency in partnership with the World Bank and the World Economic Forum, to put the world on track to achieve net-zero emissions by 2050, emerging market and developing Investment needs to increase sevenfold, from less than $150 billion to more than $1 trillion in 2021.
Perhaps the most important factor, and one that is often not mentioned, is the poorness of Africa's transmission grid. With only a handful of countries having real national grids, the vast area of the African continent and many of the countries within it, including large countries like Nigeria, Sudan, and even Tanzania and Kenya, offer enormous scope for efficient use of distributed renewable energy. This would save costs (always a key factor in the cash-starved continent) and ensure faster access to electricity.
Notable developments in the field of renewable energy
Deployment of renewable energy has grown over the past decade, with more than 26GW of new renewable electricity capacity installed at the end of last year. Among them, the new installed capacity of solar energy is the largest. Compared with the 2000s, the average annual investment in renewable energy has increased tenfold in the past decade, from less than US$500 million in 2000-2009 to US$5 billion in 2010-2020.
Investment trends accelerated in the early 2000s. Countries in Africa and around the world have recently reaffirmed their commitment to impact-building and strategic long-term projects that benefit the energy transition and promote economic stability in Africa.
In June 2023, SA-H2, a specialized mixed financing fund, was established, which aims to raise US$1 billion to support the construction of green hydrogen energy projects in South Africa. Once launched, SA-H2 will partner with the SDG Namibia One Fund to provide a comprehensive financing solution for the green hydrogen energy industry in Southern Africa. This significant development comes about a month after the signing of a memorandum of understanding between the African Finance Corporation and the Japan Bank for International Cooperation (JBIC). According to the memorandum of understanding, the two parties will cooperate in the field of infrastructure projects to accelerate Africa's energy transition.
In January 2023, as part of its "Global Gateway" initiative, the European Union and its Member States launched the "European Team Initiative for a Just and Green Recovery" for South Africa. This plan has given a big boost to green energy initiatives on the African continent. Meanwhile, Sustainable Energy for All (SEforALL), Africa Climate Foundation, Bloomberg Philanthropies, Climate Works Foundation and China Renewable Energy Industry Association (CREIA) launched the African Renewable Energy Manufacturing Initiative (AREMI ).
The main purpose of AREMI is to facilitate the necessary financial, technological and socio-economic investments to drive the development and transition of clean energy in Africa. Around the same time, the UAE signed a major deal with Zambia to provide $2 billion for solar farm development. Angola also recently secured a 1.29 billion euro ($1.41 billion) loan through the aid of the British bank Standard Chartered.
Looking back to 2022, the G7 announced the Global Partnership for Infrastructure Initiative (PGII), a $600 billion lending initiative dedicated to financing sustainable infrastructure projects in developing countries, with a particular focus on Africa. In addition, in February of the same year, the European Commission announced a package of investment funds of 150 billion euros for Africa.
main obstacle
Despite the huge potential of renewable energy, insufficient global investment in countries on the African continent has limited their renewable energy development. Only 2% of global renewable energy investment has gone to Africa over the past 20 years, and there are huge disparities across regions. Relying on grants and aid doesn't help because they often don't result in the best investments in technology or suppliers.
Reliance on fossil fuel exports is another challenge. While the clean energy transition presents great opportunities for African countries, many African countries are highly dependent on commodity exports, including fossil fuels. Indeed, fossil fuels remain one of Africa's largest exports. In future low-carbon scenarios, these fossil fuel-dependent countries will increasingly face the risk of stranded assets, with their nascent manufacturing capabilities caught between changing energy modalities.
Moreover, if there is a choice between using relatively abundant local resources or importing solar equipment, the choice is obvious for many countries, just like India's choice between using local coal versus natural gas and clean fuels. Therefore, a carefully planned approach is necessary if the enormous potential of this area is to be exploited.