A new report says Africa’s economy could grow by 6.4% in 2050 based on an energy transition integrated policy framework, bringing a wave of new sustainable energy investment.
Published by the International Renewable Energy Agency (IRENA) in collaboration with the African Development Bank (AfDB), the report shows that Africa is prospering significantly from development enabled by renewables.
The report titled “Renewable Energy Market Analysis: Africa and its Regions” shows Africa significantly improves energy access and offers profound welfare and environmental benefits to people across the continent.
According to the report, “Its vision for an energy transition in Africa aligned with global climate ambition, shows the continent generating 26 million more economy-wide jobs by 2050 than is anticipated under a business as usual scenario plan.
“Jobs created through the energy transition in Africa would outstrip fossil fuel related job losses by a factor of four, presenting a significant net gain to regional economies. Around two million people currently work in the fossil fuel industry in Africa.”
While reacting to the report, Director-General of IRENA, Francesco La Camera bemoans Africa’s governments and people’s reliance on unsustainable fossil fuels to power their development when renewable energy and energy efficiency solutions offer economically attractive and socially beneficial alternatives.
He said energy transition offers a unique opportunity for Africa to meet its development imperatives.
“Through tailored policy packages, African countries can harness their strengths and resources to overcome long-established structural dependencies,” says the DG.
In a reaction to the report, African Development Bank Vice President for Power, Energy, Climate & Green Growth, Dr. Kevin Kariuki reiterated Africa’s endowment with abundant renewable energy sources. It can sustainably base its ambitious socio-economic development.
However, he said this requires strong political commitment, a just and equitable energy transition framework, and massive investments.
Energy Finance
Based on the report, “Coal, natural gas and oil together account for about 70 percent of Africa’s total electricity generation today and conventional power attracts far more funding than renewables in Africa, owing to an established process that favours less capital-intensive thermal generation.
“Energy transition finance must become more readily accessible. Coordinated efforts should be made to ensure public spending – the dominant source of energy transition finance in Africa – clearly prioritises renewables.”
According to the report, $2.8 trillion were invested in renewables globally between 2000 and 2020 and only 2% went to Africa.
The report faulted this action because of the continent’s enormous renewable energy potential and its need to bring modern energy to billions of citizens still lacking access.
“While the rate of access to energy in Sub-Saharan Africa rose from 33 per cent to 46 per cent over the last decade, rapid population growth meant 570 million people still lacked electricity access in 2019 – 20 million more than 10 years ago. About 160 million more people lacked access to clean cooking over the same period,” says the report.
Nigeria’s Energy Transition Plan and Finance
Last year, Nigeria’s President Muhammadu Buhari signed the Climate Change Bill. The bill provides mainstreaming of climate change actions and establishes a National Council on Climate Change.
During the COP26 summit in Glasgow, Buhari pledged that Nigeria will cut its carbon emissions and reach net-zero by 2060. He also underlined the crucial role of gas in the country’s energy transition roadmap, which is short on details.
However, experts have argued that the target is ten years behind the recommended deadline by the UN and what many climate scientists would like to achieve to stop global warming.
As part of Nigeria’s commitments to clean energy, the country aims to power 5 million households and 25 million people with solar energy.
Buhari also announced last year that the country would need more than $400 billion to reduce dependence on fossil fuels and successfully implement energy transition.
Policy Recommendations
The report noted that policy choices must be made against the backdrop of a population expected to almost double from today’s 1.4 billion people to 2.5 billion by 2050.”
Therefore, it recommends Africa’s energy transition opportunities, affirms the importance of policies to facilitate the shift to a renewables-based energy system, industrial guidelines and other measures to strengthen its industrial base and diversify its economies.
It concludes with a discussion on the importance of overcoming financial constraints to improve energy access and the demands of the promise of an African Green Deal.