Published in Africa.com on 23.06.23
Delivering reliable electricity to millions of Africans, while maintaining strong economic growth during the transition to a low-carbon economy, is the defining mission of Africa in the 21st century.
Put simply, we must get it right.
As an entrepreneur and businessman, I aim for results. When I look at a business, I examine the fundamentals, measure it using data, determine strengths and weaknesses, identify the problem, and adapt to find a solution.
And right now, we have a problem. There are 600 million Africans with no access to power.
Despite this troubling statistic, we have strong energy growth potential. Increasing energy capacity is not cheap, and the continent faces many other issues which require public attention. This is where attracting international investment can help.
By partnering with international firms and strengthening our access to foreign capital we can build tangible energy solutions for hundreds of millions of Africans and further our economic growth.
Outsourcing the cost of massive energy investments to international partners allows projects to be scaled up and delivered. For investors, this means access to new markets and opportunity for lucrative returns.
Once projects are off the ground, we can benefit from additional tax revenue, allowing governments to focus on other issues which require public attention such as the cost of living and education.
Access to electricity goes beyond switching the light on-and-off. Development and energy go hand in hand, and much of Africa consumes too few resources to achieve a reasonable standard of living.
Historically and still now, we see wealthy, western, carbon intensive economies, emitting nearly all greenhouse gases into the atmosphere while reaping enormous financial benefits. Yet, these same countries often argue Africa should restrict its hydrocarbon growth due to concerns around climate change. While building a low-carbon economy is essential, and something I am personally committed to, we are not in the business of servicing Western environmental debts.
So, let’s find a solution that addresses energy supply, carbon emission, creates jobs and innovation, and contributes to the global economy.
In a recent report, the International Renewable Energy Agency and the African Development Bank estimate Africa possesses some of the world’s greatest potential for solar power generation and hydropower. It is also estimated that over 15 gigawatts of geothermal energy are stored in the East Rift System Countries.
Despite this potential, many of these resources remain untapped. Only 1% of solar generation takes place in Africa and less than 5% of geothermal potential is used. Geothermal energy is not weather dependent, in other words, a more consistent reliable energy source.
The same can be said about the need for private investment in hydrocarbon projects – this is necessary for our just transition.
While these renewable sources are absolutely something we should pursue, we must diversify our energy sources to ensure firm, reliable power. And while energy storage remains expensive, relying on renewable resources alone is not possible.
This is where transition fuels, such as Liquified-Natural-Gas, or LNG, comes in. Liquification allows you to ship the gas to places too far away for pipelines to be built. Importantly, the National Grid, the UK utility company, estimates that LNG emits 40% less carbon dioxide than coal and 30% less than oil, making it the least damaging fossil fuel source.
LNG is cost-effective and reliable; therefore, it is a good partner to our weather dependent mix of renewable sources.
This investment will no doubt lead to thousands of jobs, and a stronger trade position for the country and the region. This case study serves as a model for other African nations. With the right incentives, and private capital, we can increase LNG production and service our continent’s energy needs.
To achieve universal access to power for Africans we have a long way to go, but the solution is to attract foreign investment which will enable us to build our energy capacity, diversify our supply and encourage growth for all Africans.