How Africa and rich countries can both profit from renewable energy

Africa has huge renewable energy potential to cover the energy needs of the continent as it has six of the world’s sunniest countries on earth in its continent, the technology exists and the human resources are also in abundance but cannot tap it due to its cost.

A Norwegian Ambassador to Ghana, Hege Hertzberg said “Africa must exploit other sources of energy in order to drive its industrial expansion. Solar is the solution to so many challenges. The raw material is here, and it will last longer than oil and gas”.

The main challenges facing the African nations is the competition for scarce funds, government guarantees and lack of project experience in renewable energy and banks are often reluctant to finance projects, or agree to finance but at premium rates.

According to IT power (1987), Government and ministries in Africa suffer from a shortage of qualified renewable energy personnel for example in Kenya, there is lack of general expertise in all aspects of wind pumps in the relevant ministries and NGO’s. In Zambia, only one engineer was responsible for coordinating all renewable energy activities of the government reported by Sampa and Sichone (1995).

Also, most advance electrical renewable energy technologies are not affordable to majority of the populations in Africa as they come with high cost imported components placing an additional burden on foreign exchange reserves of Africa countries which are often minuscule and nearing exhaustion and require expensive financing and large subsidies.

Investment in Renewable energy is one path for Africa to diversify its economy. It can directly contribute to poverty alleviation by providing the energy needed for creating businesses and employment. It can also indirectly contribute to alleviating poverty by providing energy for cooking, space heating and lighting.

The Africa Progress Panel report said “The call to help African countries get better and cleaner access to electricity isn’t just a climate-related necessity but also an economic imperative”.

A number of African governments and utilities now seem to have done their homework and are set to implement the first utility-scale solar projects. With the notable exception of South Africa, Morocco and a few others, progress in scaling up solar energy in Africa has been disappointingly slow.

The World Bank Group initiated the new “Scaling Solar” meant to be a “one stop shop” to help governments mobilize privately funded grid-connected solar projects at competitive tariffs that can be operational within two years. The initiative combines World Bank guarantees, and MIGA investment guarantees and IFC (International Finance Corporation).

More initiatives like Scaling Solar are therefore required to support the low-carbon expansion of Africa’s power sector. The Rich countries should help Africa to invest more in renewable energy to diversify its economy to help address unemployment, which is estimated to be over 20 per cent in sub-Saharan Africa.

According to a new report published by Tony Blair and the Climate Group,

“Action to cut CO2 emissions can increase both GDP and employment in all major economies, with global collaboration significantly cutting the cost of climate change mitigation. It also shows that adopting low carbon technologies will accelerate sustainable development in developing countries”. Therefore, mobilizing multilateral and bilateral financing institutions is vital for ensuring a sustainable development of the renewable energy market in Africa.

French Foreign Minister Laurent Fabius said “As far as the G-7 is concerned, it’s really important that the richest countries clearly affirm their commitment to respecting these financial needs and–if necessary–increase their effort.

As the Governments and climate negotiators are heading to Paris this December, the message we have for the G-7 is: Give Africa access to green financing has finally get on track.

At least as a positive sign it can be considered that the representatives of African nations and of the African Union were invited to the G7 summit in Elmau, Germany in June. They agreed to commonly install about 10 gigawatts of renewable in Africa until 2020 -which sounds a lot, but can after all be viewed than hardly more than a starting point. Furthermore, simply installing renewable energy is not the only solution for Africa as lack of personnel resources and expertise often are the core problem.

The new study Powering Africa through Feed-in Tariffs" analysis the renewable energy law in 13 African countries including Algeria, South Africa, Nigeria or Uganda. Reviewing numerous case studies in all these countries can be concluded that an effective use law to foster renewable energy has enormous potential. However, the challenge is to tailor such laws to the regional needs, especially to those in regions which are not connected to the grids.

Despite the fact that feed-in tariffs are the most efficient instrument to foster renewable, such laws have hardly been put in place in Africa. Two Thirds of all wind mills and 87% of all solar power plants are situated in countries with feed-in tariffs especially in rural areas self-contained mini-grids and solar energy are the best hope for energy access. Despite the economic potential of these markets investors often remain inactive because of unclear framework conditions. This is particularly remarkable since both sides could enormously profit from prospering renewable energy markets: While particularly people in rural areas would benefit from autarchic mini-grids these countries offer a highly valuable market for investors who could provide the necessary technology. Development programs try to provide the necessary information and the necessary contacts or to grant financial security.

Such programs enable green clean energy for African people but also markets for investors. If implemented in the right way both sides can benefit, but those projects remain relatively small, namely when compared to investments in coal power. Taking for example a look at the green climate fund on has to find out that the first private financial partner the Deutsche Bank is one of the biggest financier of coal power across the world. Responsibility of Industrialized countries goes beyond enabling renewable it also includes preventing dirty energy like coal power.

Fariya Abubakari is the Country Coordinator of End Ecocide Ghana,
Global Ambassador of YEW, Commonwealth Correspondence, Climate Tracker Activist for Adopt a Negotiator Program, Agricultural Economist and a soil scientist. fariyaabubakari@yahoo.com.

Andreas Sieber worked for several NGOs, including Greenpeace International and Oxfam. He is a blogger and a Climate Tracker. He focuses on the role of industrial countries in international climate negotiations. mail@andreas-sieber.de

Farida Abubakari is the Global Ambassador for Youth and Enlightenment and Welfare (YEW) Ghana, Agricultural Economist, Soil Scientist and a Climate Tracker for the Adopt a Negotiator program. Email: uniquefarida@live.com