Without national regulatory frameworks geared to supporting renewables, the energy transition could remain a distant dream in Africa, according to Salvatore Bernabei, CEO of the Enel Green Power renewables division of the Italian energy company.
Bernabei was speaking at a webinar dedicated to driving the African energy transition, organized by the European Commission, African Union Commission, and the European Council’s Portuguese presidency, and backed by the European Investment Bank, African Development Bank and the secretariat of the Africa EU energy partnership.
Enel Green Power boss Bernabei said: “Some countries, like South Africa, Morocco, and Egypt, have great regulatory policies but we cannot make a greater impact with only three countries.”
Assistance
Frans Timmermans, executive VP of the European Green Deal for the European Commission, said the EU and its member states stood ready to help African governments introduce the policies required to help catalyze private-sector investment in clean energy.
Through the auspices of the African-EU Green Energy Initiative, the European Union and African Union would finally implement a long-desired strategic energy partnership which would aim to drive investment in clean power generation, raise access to electricity, and promote energy efficiency, said Timmermans.
The commission VP said: “We cannot limit ourselves to energy access based on six hours of electricity per day, which is barely enough to plug a fan, a radio, and a TV. We need to think big. We need access on a scale which can truly help the economic development and the industrialization of Africa.” Stating the bloc and its member states have, since 2013, more than doubled their contributions to partner nations pursuing a sustainable development path, Timmermans said 30% of the EU’s external partnership budget would be devoted to climate change investment over the next seven years.
The commission representative also emphasized the need for supportive policymaking, including energy sector reform, carbon pricing and access to affordable finance in African nations. While Timmermans said the public sector needed to take action, European Commission peer Koen Doens, director-general for international partnerships, said stronger links between African and European businesses could also play an important role.
Francesco La Camera, director-general of the International Renewable Energy Agency (IRENA), said a broader approach needed to be adopted in Africa, both in terms of widening the debate beyond which technologies to deploy and in terms of national interests. Cross-border, regional infrastructure would be more effective in harnessing the industrial and development benefits which industries such as green hydrogen production might offer to the continent, he said, adding, the 2.7 GW of solar capacity installed in Africa last year amounted to just 0.01% of the renewables projects added worldwide.
Africa will need a decade to complete the goal of providing access to energy for its 600 million people who are unconnected at present, said African Union commissioner for infrastructure and energy, Amani Abou-Zeid. “We urgently need to think of innovative ways to mobilize resources and invite [the] private sector and governments on this journey to green energy access,” she added.
That sobering prospect is also an opportunity, Kandeh Yumkella told the webinar. “Connecting 600 million people with electricity is not only a challenge but also a great business opportunity for the two sister continents,” said Yumkella, co-chair of the strategy group for energy at policy thinktank the Africa Europe Foundation.
Finance
Lack of accessible finance is a significant hurdle between African businesses and that opportunity, the event heard, and Hela Cheikhrouhou, CEO of Washington DC-based energy finance provider Nithio Holdings, emphasized the benefits blended finance – comprised of public and private-sector cash – could offer.
“If you looked at the map of the world ten years ago,” said commissioner Timmermans at the event, “coal was the cheapest option to produce electricity everywhere, with a few small exceptions. Today, in competitive procurements, renewables come out cheaper than the cheapest coal plants. Last year, we saw record-low auction prices for solar energy in Ethiopia, Saudi Arabia, Mexico, and Chile. For instance, it cost only three cents per kilowatt-hour. But if you wanted to build a new coal plant, it would cost you three times more, over nine cents.”
The commission VP said: “Fossil fuels are not a good business and we would never try to convince our partners in Africa to buy second-hand fossil fuel technologies.” In terms of the planned partnership between the EU and Africa, he added: “It’s about enhancing technology transfer, boosting the transition to new energy resourcing and leapfrogging some of the developments that would lead to higher emissions, rather than to more sustainable energy systems.”
