Page 7 - AfrElec Week 12 2022

AfrElec INVESTMENT AfrElec

Africa faces challenges for

energy transition

AFRICA THE International Energy Agency (IEA) has because of perceived risks, energy investments
highlighted that Africa faces both major chal- in Africa face much higher financing costs than
lenges and huge opportunities as it makes comparable projects in developed markets.
the transition towards clean energy, allowing In June 2021, IEA Executive Director Fatih
the continent to bypass traditional fuels and Birol and EU Commissioner Frans Timmer-
infrastructure. mans said that Africa could achieve universal
Yet African companies and governments will access to power by 2030 if the rest of the world,
need the help of the international community, led by Europe, puts energy access at the centre of
especially to attract the necessary investments, their economic co-operation with Africa.
IEA members stated at the IEA’s 2022 Ministerial The issue is urgent, as in 2020, the number of
Meeting. people in sub-Saharan Africa without access to
The IEA member ministers identified that electricity actually grew. This was the first rise in
there still existed a long list of existing barri- seven years, and was caused by pandemic restric-
ers to clean energy investment, and that 2023 tions holding back work to connect homes, busi-
would be a key year to break down these barri- nesses, schools and hospitals.
ers, especially as COP27 will be held in Egypt in In June 2021, the IEA warned that without
November. investment of $1 trillion per year by 2030, devel-
Africa is already one of the regions of the oping economies could be emitting the majority
world most affected by climate disorders and of the world’s greenhouse gas (GHG) emissions
is home to one-sixth of the global population. in future.
Yet it accounts for less than 6% of global energy The IEA forecast that emissions from emerg-
consumption and 2% of cumulative global ing and developing economies (EMDEs) are
emissions. projected to grow by 5bn tonnes per year (tpy)
The continent faces the conundrum of pro- by 2040, compared with a projected 2bn tonne
viding universal power access, stimulating fall in advanced economies and a levelling off in
economic growth attaining sustainable develop- China.
ment goals. At the meeting, Belgian Energy Minister
Africa has the potential to play a leading role Tinne Van der Straeten recommended the IEA
as the world’s energy systems make the transition further deepen its engagement with Africa to
to a net-zero future. The continent’s geographic identify practical steps that industry, govern-
diversity holds huge potential for solar and wind ments and international organisations can take
power, and its soils are home to many of the min- to drive down the cost of energy investments
erals and rare earths needed for clean energy while focusing on the technologies best suited
technologies. to Africa. ™
The IEA has previously highlighted that

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