Energy is a key catalyst in moving Africa forward

Energy is a key catalyst in moving Africa forward
Lelo Mdhladhla is the chief marketing officer of PowerX.

‘We have to be impatient in moving Africa forward”. These were the words of Akinwumi Ayodeji Adesina, President of the African Development Bank at the World Economic Forum in 2016.

Two years on, this quote is as relevant today as it was when it was spoken in the snow-capped hills of Davos, Switzerland.

I believe that energy can be a key catalyst in moving Africa forward. But first, let’s look at the macro-economic indicators of Africa holistically. Compared with the rest of the world, Africa as a continent has enjoyed “above-average” growth. The aggregated gross domestic product growth (GDP) was 3.6% for 2017, with a forecast growth of 4.1% in 2018.

According to the World Bank Report released earlier this year, Ghana and Ethiopia are expected to achieve GDP growth of 8.3% and 8.2%, respectively. In fact, the World Bank predicts that Ethiopia economy will double by 2025.

Admittedly closer to home, South Africa’s economy has seen a -2.2% contraction in the last quarter. However, the reforms being implemented (especially with respect to state-owned enterprises) should create fertile soil for “green shoots” come 2019 and 2020.

Taking a closer look at the homogeneous challenges facing the African continent, they can be grouped into several principal areas: job creation, food security, water stewardship and climate change.

While these challenges may vary in degree of severity from country to country, their impact is the same. These issues stifle economic growth and create widening gaps of inequality in our citizens. However, shifts in the regulatory environments coupled with innovation, are creating opportunities for addressing these societal ills.

Job creation

In Botswana, legislative changes in 2016 have opened the country’s energy market to Independent Power Producers (IPPs). As we have seen in South Africa, the Renewable Independent Power Producer Programme (Reipppp) has spawned multiple manufacturing and service industries in addition to achieving significant job growth since its inception.

Given Botswana’s unemployment rate of 18.1% against a population of just more than 2million, a programme like Reipppp would serve to reduce levels of unemployment and create sustainable manufacturing capacity.

The levels of solar radiation in the country and methane gas opportunities resulting from the thriving livestock industry are clear indicators that this country is primed for renewable energy expansion.

Food security

In Kenya the reduction of connection charges and end-user tariffs for both domestic and commercial/industrial consumers is anticipated to alleviate the country’s low levels of electrification. This country is heavily reliant on food produce exports (coffee, tea, spices).

Therefore, there is a need for promoting the use of renewable energy systems for sustainable agriculture. For example, solar photovoltaic water pumps, and solar water heaters can provide irrigation and input into production processes for produce such as milk, as well as staple crops (for example, maize).

As part of accelerating electrification, a programme dubbed the Green Mini Grid (GMG) facility in Kenya has been rolled out. This programme aims to connect 14000 homes and businesses to green mini-grids by the end of 2018.

Water scarcity

Ethiopia, as one of the top five ranked driest countries on earth faces a dire water scarcity threat. With a projected economic growth of above 8% for 2018, the scarcity of water could throttle economic growth if serious measures are not taken.

Innovation could be Ethiopia’s saviour. For example, the Sahara Forest Project in Australia uses seawater as an energy source. In a nutshell, the seawater is pumped from the sea and dripped over a “honeycomb” structure inside a greenhouse, where it evaporates. The evaporation cools down the indoor environment, while the resulting water vapour condenses on the greenhouse roof forming fresh water.

Emissions

South Africa, as the most industrialized economy, is also understandably the biggest emitter, with emissions states at 468 metric tons of carbon dioxide as at the end of 2016. While the Reipppp has gone some way to reducing the reliance on coal-fired power, more than 70% of the country’s power comes from fossil-powered generation.

Companies across the country are seeing the benefits of reducing energy costs through the installation of renewable energy solutions, via tax incentives.

Given the capital outlay of installing solar PV systems on large building roofs such tax incentives help to accelerate the payback period, thereby alleviating the cost for the business.

By harnessing the power of our natural resources, we can unlock endless possibilities for energy, the catalyst for change in Africa.

Lelo Mdhladhla is the chief marketing officer of PowerX.

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