The Right Energy
Harare – Much has been said and written about renewable energy having the potential to meet the world’s increasing electricity demands.
But for all the research and recommendations, Africa as a whole ‑ and Southern Africa in particular – lags behind in the green revolution though the region probably needs such ventures the most.
Experts say SADC requires several reforms to its energy sector to meet increasing demand for electricity, and renewable energy sources, though capital intensive, are the long-term solution.
For the reforms to happen, and for electricity to be delivered to industry and households, SADC governments must start investing in converting the research into practicable ventures.
With the gap between power supply and demand set to continue growing, the region’s development agenda should assign more importance to readily available renewable energy sources.
However, while there is a huge power gap, there is arguably an even bigger funding gap.
With billions of dollars required to kick-start large-scale energy projects, investors have been hesitant to enter a sector that will in the long-run not guarantee the huge profits associated with coal and uranium power.
Which means the onus is on governments to deliver on renewable energy as many in the private sector view it as less viable than traditional sources of electricity.
But how do Southern Africa’s governments finance such initiatives?
Carlos Lopes, the Executive Secretary of the UN Economic Commission for Africa, has suggested that governments set aside just one percent of GDP for infrastructure. The money can be pooled and used for priority projects at regional level.
So far, no African country has been keen to take up the suggestion, while instead waiting on investors who have not been forthcoming.
With Africa’s GDP estimated at US$2 trillion, Lopes’ suggestion would translate to an infrastructure fund worth US$20 billion in just one year. For SADC, with a GDP of US$650b (2011 figures), this could immediately unlock US$6.5b.
While this may seem like little compared to what the region’s energy infrastructure needs are, it is far much more than investors have brought to the table thus far.
The Case for
Africa is industrialising and urbanising at a fast rate, and this in itself will result in greater energy demand.
Furthermore, there is a growing thrust to ease pressure on urban areas by decentralising development, which in itself entails a major rural electrification drive.
According to the World Bank, 63 percent of Africa’s population lives in rural areas. In addition to that, about 60 percent of the continent’s population is not connected to any energy grid.
And the electrification figure for Africa is only so “high” because North Africa has a penetration rate of over 90 percent.
S Szabo, K Bodis, T Huld and M Moner-Girona, writing in 2011, said: “Despite a high total population figure — in Africa it exceeded one billion in 2009 — United Nations estimates show that most parts of the African continent are sparsely populated, with almost 60 percent living in non-urban areas.
“This fact, coupled with the low per capita energy consumption and the high rate of non-electrified rural areas, creates a good opportunity for a sustainable energy development based on decentralised renewable energy sources.”
Firewood is simply not a viable energy source for rural areas, hence, the need for a comprehensive renewable electricity policy.
A World Bank report says the 580 million Africans without access to modern forms of energy spend more than US$10b annually buying kerosene/paraffin, candles and firewood.
Further figures from WHO indicate that death associated with the use of these energy sources in Africa runs into several hundreds of thousands annually.
Investing in clean, renewable energy would do wonders to bring greater economic development to rural areas, while also improving people’s standards of living. Schools and health centres, too, would immensely benefit.
The SADC Secretariat has been working on a renewable energy project with Finland, and it is one such initiative that would benefit from a common regional fund for infrastructure development: the Renewable Energy Strategy and Action Plan (RESAP).
A mid-term review of RESAP commissioned by Finland’s Foreign Affairs Ministry and SADC, through a consultants at Camco, indicates that not much ground has been covered in delivering renewable energy to an electricity-starved region.
The Energy Sector Plan under SADC’s Regional Infrastructure Development Master Plan seeks to reduce the power deficit by at least 70 percent in the next 15 years. This would require investment of US$170b.
SADC leaders approved the plan at their 32nd Summit in Mozambique last year, and it is hoped this plan will see generation capacity surpass the 96 000MW of projected demand by 2027.
The Camco report says Southern African countries have great potential to meet a considerable share of this energy demand through renewable sources.
“There is widespread agreement among stakeholders that in order to develop and utilise abundant regional renewable energy resources, limited capacity at the SADC level and the adverse impact this has on the implementation of regional energy programmes needs to be addressed going forward,” reads the report that was published in October last year.
“Barriers to RE (renewable energy) development in the SADC region are due to numerous compounding factors such as inadequate legal and institutional frameworks to support RE, difficulties in accessing financing to support RE market development, capacity and information barriers and lack of political will to support long-term RE planning and integration into regional energy markets.
“In most cases, RE projects particularly those involving more than one SADC member state, often take long to get off the ground.
This is partly attributed to the challenges associated with cross-border trade as national interests have the tendency to prevail over regional energy needs.”
Camco experts recommended six key areas of improvement: stakeholder engagement, reformulation of the Renewable Energy Support Programme, refinement of RESAP (Renewable Energy Strategy and Action Plan), knowledge management, recruitment for the SADC Energy Desk, and re-affirmation of SADC-MFA (Finland Ministry of Foreign Affairs) Co-operation.
The consultants say the past decade has seen the SADC energy sector witnessing both challenges and opportunities with regard to renewable energy development.
“This context has highlighted the need for Southern Africa to explore opportunities to supplement the current energy supply deficit through the use of renewable energy sources.
“SADC Member States have acknowledged the benefits associated with renewable energy development at various junctures. However, at present, low levels of RE penetration and use across the region are largely attributed to a lack of effective legislative and regulatory frameworks that would support market development.
“In addition, there are limited institutional mechanisms and technical capacity at all levels (ie local expertise and governmental capacity) to successfully implement RE programmes and projects.”
We Waiting For?
Lord Aikins Adusei, an expert in energy, argues that demand for fossil fuels at the global level will price Africa out and leave continental economies flagging.
In a paper titled “Exploring Africa’s ‘green’ potential”, he says of Africa: “It accounts for more than a quarter of the 2.5 billion people globally who are without access to convenient, reliable, efficient and modern cooking technologies that can help meet their basic needs and support their economic development.
“It also accounts for the larger share of the 1.6 billion people globally who are without electricity.”
Lord Adusei quotes a 2008 report by Anton Eberhard that says Africa’s electricity infrastructure capacity is the lowest in the world.
“In the study Eberhard noted that the 48 Sub-Saharan Africa countries with a combined population of more than 800 million produced about 68 gigawatt of electricity, almost the same amount of electricity generated by Spain with her population of 45 million people.
“When South Africa is taken out of the equation, the total power generated fell to 28GW, equivalent to the installed capacity of Argentina.”
Professor Mthuli Ncube, a Vice President at the African Development Bank, adds that despite a global increase in the use of renewable energy sources, Africa still lags behind.
“Electric power in many African countries is still inaccessible, unaffordable, and highly unreliable … Yet Africa is rich in renewable resources and could benefit from the increasing use of renewable energy, such as hydro-power (potential estimated around 1 750TWh) and geothermal energy (estimated at 9 000MW).
“Over 80 percent of the continent receives about 2 000kWh per square metre of solar resources per annum and a solar generating facility covering just 0.3 percent of North Africa could supply all the energy requirements of the European Union.”
Environmentalists have time and again pointed out that RE protects the environment by reducing carbon emissions, which cause adverse climate changes; scientists say RE helps meet energy security needs; while social commentators argue RE reduces resource conflicts.
What then is Africa waiting for?