Following high-level declarations at the Sustainable Development Goals and the Paris Climate Conference in late 2015, there is a growing appetite for renewable energy in Africa. This is much-needed; the continent’s energy supplies are not meeting the needs and aspirations of its people. A better system will promote economic diversification, raise productivity, and improve the health and wellbeing of citizens. Africa requires between $60 and $90 billion annually to address its energy shortfall, roughly quadruple 2014 investment levels.
While fossil fuels, notably coal, oil and gas, continue to provide a significant quantity of energy - especially in South Africa - renewables need to play a greater role. Africa has plentiful resources, from geothermal power in Kenya and Ethiopia to hydropower in Zambia and the Democratic Republic of Congo. Solar and wind are especially promising, thanks to falling costs and resource abundance. From solar-powered hospitals in Lagos to wind farms in Lake Turkana, renewable energy is not just a pipe dream - it is a reality. Renewables can increase energy security, reduce energy import bills, and diversify and de-risk the energy mix. Through off-grid technologies, they can provide direct, affordable power to rural regions beyond the reach of the grid system.
But to harness renewables at scale, very significant infrastructure is needed: both core assets like wind and solar farms1 and transmission grids, as well as connective infrastructures, like roads to and from sites for transporting kit and manpower, or for bringing products, like solar-powered mobile phones, to market. This requires effective regulation, sufficient financing, appropriate technologies and smart business models. The ambitions are there.
The African Renewable Energy Initiative, led by institutions including the African Union and the United Nations Environment Programme, has set a goal of 300 GW of renewable energy capacity by 2030. But this requires a 680% increase in current deployment rates. According to IRENA’s latest data, the installed renewable power generation capacity in Sub-Saharan Africa currently stands slightly below 30 GW, roughly 25-30% of the installed power base, but this is dominated by large hydro, with other renewables collectively accounting for just 4-5% of power generation. Can the investment be achieved? Who are the current players and how is the market evolving?
This report, combining country fieldwork and 28 expert interviews, looks at the current renewable power capacity on the continent, identifies the market leaders and looks at the key enablers and constraints.