Africa is undergoing an energy transition that is seeing a greater integration of gas and renewables in the mix as the continent aims to cater to millions without energy access.
Dr Amani Abou-Zeid, Commissioner of Infrastructure, Energy, ICT & Tourism, African Union Commission spoke on Wednesday during a conference at the Egypt Petroleum Show (EGYPS) 2020, highlighting the growing population of Africa and also a growing need for energy at a time coinciding with a large number of new oil and gas discoveries on the continent.
“One side of the story is positive but the other side is that more than half the people - 600 million - don’t have access to energy and 900 million don’t have access to clean water,” Dr Amani said.
Meanwhile, the energy transition is in different phases in the 55 countries across the continent and yet, it has two of the largest solar plants in the world. “There are some people who have a doubt in fossil fuels but we are looking to bridge the energy gap quickly. Gas is only 5 per cent of the energy use, for many reasons but it is fast-growing now to meet the continent’s demands,” she said.
Africa recently implemented a breakthrough free trade agreement, which also makes it the largest area in the world to do so.
“Trading is high on our agenda as well as bridging the energy gap,” Dr Amani said, adding that while the continent is conscious of carbon emissions, which contribute to a small fraction of global portion at 2-3 per cent, access of energy to the population would not impact this by much.
“We are increasingly shying away from coal and focusing on renewable and gas. Our priority is access to energy but we are addressing the challenge of efficiency and impact of global warming, while trying to attract investment funds,” she said.
Meanwhile, Dr Ayed S Al-Qahtani, Director of Research Division, Organization of the Petroleum Exporting Countries (OPEC) said in its global energy transition projections, it expects oil to remain dominant, but slip from contributing 32 per cent to 30 per cent, while gas will grow from 25 per cent to 27 per cent.
Meanwhile, renewables are growing at the fastest pace, because they started from a small base, and will still contribute for a small part of the mix at 6 per cent.
“Each part of the world has its own needs and the energy mix, aside from other factors, is very much dependent on how much technology you can bring to the table,” Dr Ayed said.
Speaking about Africa, Dr Ayed said: “infrastructure is an issue but we cannot look at it in terms of economy. To equate the emissions with population, Africa is lagging behind in terms of BTU consumption per capita - a lot has to do with lack of available financing and challenges with deploying labor into the economic machine.”
Additionally, Dr Amani said that the infrastructure for trading between countries is almost non-existent and is a major loss. “We are taking concrete steps to fast-track our initiatives and energy is on top of our agenda as we see the economic transition across the continent,” she said.
One issue she highlighted towards infrastructure is financing.
“Africa’s financing gap for infrastructure at large is between $130-170 billion. But while financing has always been a challenge for Africa, our countries are doing so much better now. A large number of countries are investing in energy, and embarking on serious improvements on investment plans. That said, we are also working to make the world see the risk in Africa is not justified,” she said.