I believe Africa can emerge as the global leader in the drive towards 100 percent renewable energy. There are several compelling reasons for this.
With its plentiful natural resources and large population under the age of 25, Africa is both the future and the hope of the world economy. It is in the world’s best interests to help Africa improve core sectors like energy and education because they promote stability and growth. They also have a direct impact on GDP growth in both the short and long term.
When it comes to energy, Africa is in a sweet spot. It is uniquely positioned to move directly to renewable energy without dealing with legacy capacities or having to go through old power technology cycles like several developed nations.
Renewables offer Africa the opportunity to access cheaper sources of energy, reduce dependence on oil and enable sustainable development. That’s a big deal for a continent where approximately 600 million people have no access to electricity at all or can’t afford to pay for power even if they have access to it.
A report on Electricity Access in Sub-Saharan Africa by AFD, the French development agency, and the World Bank states: ‘Currently, the unit cost of electricity to consumers in many countries in Africa is more than double the cost in high-income nations such as the United States (USD 0.12/kWh) and far higher than in many emerging markets such as India (USD 0.08/kWh).’
Renewables can help bridge this gap in a big way. The Scaling Solar program is a good example of this. However, in our experience, African power grids struggle to absorb more than 30% renewable energy due to dispatch intermittency and lack of flexible power generation.
Today, Africa is ushering in a new era in energy transition. Its energy sector is in a similar place as its telecom sector was a few years ago. Africa had the unique chance to hop on to 4G at an early stage in its development thereby putting its telecom sector at par with that in Europe.
Similarly, the continent can jump directly into a new phase in its energy market by having more renewables installed that can make it a part of the same ecosystem prevalent in developed regions like Europe or America. The good news is that Africa already has abundant sunlight and wind in its coastal belt and the prices of solar and wind technologies have fallen dramatically these past few years. Africa also has several untapped opportunities in the area of Power-to-X technologies. Its vast solar resources from Sahel to the Horn of Africa provide the continent with a chance to convert excess solar energy during the day to synthetic gases that could, in turn, be used for conventional power production in the night. Ditto with natural gas.
The challenge, therefore, is in project development as only a few private players have succeeded in building bankable projects.
At Wärtsilä, we are trying to change this. On the one hand, we are helping our customers develop projects with the right agreements, eco-studies and achieving financial closure. And on the other, we are offering them smart power technologies with advanced storage capabilities so that they can offer reliable services.
As a development partner, Wärtsilä is playing a crucial role in project development, working with our partners across the continent. We have already equipped and/or built over 530 plants with 1,300 engines producing nearly 7.2 GW of power in 46 African countries. Our smart power solutions, including advanced energy storage, help power producers manage flexible base loads while reducing emissions.
According to Bloomberg NEF, in 2040, renewable energy will account for 32% of the energy mix in Africa, followed by gas (30%), coal and hydro (16% each). That translates into nearly 300 GW in solar energy alone! The potential is huge and overwhelming. Moving towards 100% renewable energy in the region via a smart mix that guarantees grid sustainability and reliability is an achievable goal. One that just needs vision and will power.