Page 5 - AfrElec Week 08

AfrElec COMMENTARY AfrElec
while it has installed 3.1 GW across Africa, with projects in Egypt, South Africa, Morocco and Tunisia. The company also provides wider energy services, and is advising the Egyptian government on digitising grid operations and billing in a bid to improve energy efficiency and the resilience and sustainability of supply infrastructure.
Wind investment
The involvement of African investors, and the presence of a global giant such as Siemens Gamesa, means that the Djibouti project is well placed to address the challenges outlined by the GWEC.
It takes regulatory support from governments and a high appetite for risk from private investors to develop wind farms in frontier areas such as Djibouti, even if there are large utility-scale farm now operating in places such as Egypt, Ethiopia and at Lake Turkana in Kenya.
The Djibouti wind farm aims to take advan- tage of industrial projects that can provide the demand reliable bill payers needed to reduce offtaker risk.
In the context of Africa, Egypt has enough infrastructure to support large utility-scale wind farms, and countries such as Djibouti and Kenya aim to achieve this. But across the continent micro-grids in areas without grid connections will be the key technological solution that can
connect people to power and help meet rising demand.
Siemens itself predicts that that wind power could account for 34% of global electricity out- put by 2040, up from 4% at present, according to a KPMG report commissioned by the Span- ish-based company.
Crucially, wind has the potential to provide 23% of the reduction in carbon emissions needed by 2050 to meet the IPCC’s climate change and temperature reduction goals. This amounts to 5.6bn tonnes, equivalent to the current annual emissions of the world’s 80 most polluting cities, the report found.
The report identified that environmental risks for investment projects over a ten-year horizon had increased by 60%.
This means that climate change and extreme weather are seen as the gravest threats to the success of both energy investment projects and global society at large.
Since the start of the year, the likes of Black- Rock have led private equity and institutional investors in declaring that environmental risk is now investment risk, and that climate change is now a major factor affecting investment decisions.
In this context, pioneering wind farms such as that in Djibouti offer excellent opportuni- ties to reduce emissions in Africa’s developing economies.™
Week 08 27•February•2020 w w w. N E W S B A S E . c o m P5