Across the world, countries are going green and being deliberate about decarbonizing their energy systems. In Africa, the narrative is slightly different; meeting the energy demand of its exponentially growing population remains one of the continent’s most critical challenges and priorities. Whilst there are notable renewable projects on the continent, from the construction of the world’s 10th-largest hydropower dam in Ethiopia to solar-powered homes in Senegal, these projects are few and far between. On a grand scale, the question remains: what is the fastest and most cost-effective way to realize access to energy for the majority of Africa’s inhabitants, consumers and businesses?
While some African countries have made significant strides in electricity provision over the past decade, over 640 million Africans (circa 50 per cent of the population) remain in the dark. With a population of 1.34 billion, Africa’s current energy generation capacity is less than 200 gigawatts (GW), compared to the United States, which generated approximately 1,200 gigawatts (GW) for a population of 331 million in 2020. In comparison, per capita, energy consumption in Sub-Saharan Africa, excluding South Africa, is 180 kWh, compared to 6,500 kWh in Europe. With current trends, it could take Africa another 60 years to fulfil its energy demand needs. As the calls for a more sustainable world increase, Africa must find a balance and take a different approach for the following reasons:
- There is no “one-size-fits-all” solution for the future of energy: In truth, the energy mix will differ across regions and even nations. For example, the United Kingdom focuses on wind energy, which provided 40 per cent of its power in 2019, whereas Africa focuses on hydroelectricity and solar energy due to the continent’s abundance of sunlight. In essence, while our collective goal is a carbon-neutral world with increased energy efficiency, we can only achieve this by combining multiple strategies.
- Africa needs to know the difference between what it has and what it needs: Africa consumes ~3.3 per cent of global primary energy. Expectedly, it contributes only two per cent of global carbon emissions. While this does not reduce the urgency to contribute to a carbon-neutral world, Africa, unfortunately, does not have the luxury to switch gears as quickly as other economies. More so, following the negative impact of the COVID-19 pandemic, the continent suffered a three per cent GDP contraction, leaving an estimated six per cent of sub-Saharan Africa’s 1.1billion inhabitants unable to afford basic electricity. So, whilst the switch to renewables is a step in the right direction, Africa’s immediate needs beg to differ. With energy demand expected to at least double by 2040, a cleaner alternative to coal and oil is natural gas which the continent has in abundance.
- Africa must transition at its own pace while learning from those who have gone ahead: As previously stated, one of the primary reasons Africa’s carbon emissions are the lowest in the world is that the continent does not generate enough energy in comparison to industrial nations such as China and the United States, which emitted 38 per cent of the world’s greenhouse gases in 2019. As a result, policy development approaches and commitments to reduce emissions must differ. These countries have had over 400 years of development using fossil fuels; therefore, expecting Africa to evolve at the same rate as these countries will only impede the continent’s growth. Rather, Africa has a once-in-a-lifetime opportunity to learn from other countries as it develops its energy blueprint.
The gas advantage
According to BP’s 2021 statistical review, Africa’s energy mix in 2020 was 38.7 per cent oil, 29.6 per cent natural gas, 22.1 per cent coal, 0.8 per cent nuclear energy, 6.8 per cent hydroelectricity, and two per cent renewables. Projections for the year 2040, on the other hand, show oil at four per cent, coal at 27 per cent, gas at 25 per cent, hydro at 26 per cent, other renewables at 26 per cent, and nuclear at 18 per cent. Contrary to popular opinion, solar is not expected to be a significant source of energy in the next 20 years based on this projected energy mix – and the reason is not far-fetched. Africa is inherently limited – technologically and structurally. In essence, even though the continent has the highest solar potential of over 10 terawatts, we currently lack the infrastructure to develop this energy source to commercially viable levels.
Nigeria’s 206 trillion cubic feet of gas reserves is the largest in Africa, a proportion of which is said to have been ‘accidentally’ discovered while in search of crude oil. It goes to show that if the country sought out to find gas, it could find up to 600 trillion cubic meters. On a continental scale, leading producers are likely to produce more gas; North African nations such as Egypt and Algeria will account for a portion of this increase, with efforts underway to accelerate the development of existing natural gas fields. Therefore, the first reason gas is an advantage to the African continent is simple – we have a lot of it, 455 trillion cubic feet.
It, therefore, stands to reason why after coal, gas generated power stands as the source with the next highest potential capacity. However, while Africa has a potential energy capacity of about 350GW from hydropower, of which only about 10 per cent is being utilized, the abundance of gas on the continent means it represents a lower hanging fruit in attempting to close the energy demand gap as all indicators show that the continent has a longer path to closing the gap using renewables than with gas; and even with this, there is a long journey ahead in the utilization of gas, due to a lack of infrastructure and financing. A case in point is Nigeria where despite its leading gas reserves position in Africa, the country has been unable to graze the surface of converting its vast gas reserves to energy due to a lack of infrastructure.
Some would argue that gas and renewable energy in Africa will have challenges in closing its current energy demand gap, so why not make the switch along with the rest of the world to renewable energy? However, the difference with the infrastructural deficit arising from the switch to renewable energy compared to gas is that gas remains a familiar terrain. Today, multinational corporations, if adequately funded, can build commercially viable gas infrastructure because the technical know-how already exists.
While renewable energy must be a part of Africa’s future, gas currently provides a cleaner alternative for a more energy-inclusive continent. A plan that considers Africa’s need for growth and development recognizes the role of renewables in supplementing the continent’s use of gas. The transition to sustainable renewable energy sources should ideally occur only after the continent has sufficiently explored and utilized gas. In other words, we mustn’t abandon the opportunities that exist and rush to renewable energy haphazardly because the world demands it.
Written by Ejiro Kunle-Hassan, Business Analyst, Oando PLC.