When the G20 Summit meets in Hamburg, Germany on July 7-8, 2017, the investment in Africa’s future will be high on the forum’s agenda. German Chancellor Angela Merkel is planning on using her presidency of the forum to promote “sustainable growth and jobs” on the continent, with a focus on “investments in infrastructure and renewable energies.”
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Energy, and specifically, electricity is not a new need for people in Africa. Actually, the continent accounts for 13 percent of the world’s population but only 4 percent of its energy demand.
And while many parts of Africa are energy resources-rich, the African Development Bank calculates that some 620 million Africans live without access to reliable electricity.
Solar has a huge potential for Africa
Fast-dropping costs for solar power, in addition to abundant sunshine and a critical need for electricity, means “solar has huge potential in Africa,” said Adnan Amin, the director general of IRENA.
Pointing out that Africa gets 117 percent more sunlight than Germany, which has the world’s highest installed solar energy capacity, he said, “Africa’s solar potential is enormous,” according to his interview with the Thomson Reuters Foundation. “It has never been more possible and less expensive for Africa to realize this potential,” he said.
But perhaps, just as important for the continent as a whole, electricity is fundamental for economic development, providing communities and businesses with access to reliable, clean, and affordable energy. Reliable sources of electricity are more than powering homes and schools.
Access to electricity will also allow young people to stay at home instead of traveling to Europe and beyond for economic opportunities. Innovations in solar storage and better transmission would boost economies and create thousands of jobs.
Alpha Condé, President of Guinea and Chairperson of the African Union says, “In 36 African countries, just two in five people have electricity throughout the day. In some countries, fewer than one in ten do.” He adds that cooperation between developing and developed economies – particularly in the energy sector is needed to get solar energy and other renewables up and running.
More innovation and less costs
Nairobi- born Amin says that while solar power can have upfront costs higher than traditional fuels, technological and financing advances are helping to reduce those costs. Not only are the price of solar panels dropping, the price of producing electricity from “mini-grids” not connected to larger national grids is also coming down, with prices expected to fall 60 percent over the next twenty years.
“The rapid rise of pay-as-you-go solar home systems and integration with mobile payment technology is an example of the speed of innovation that is taking place. In East Africa alone, over 450,000 such systems have been deployed,” he said. IRENA estimates that 60 million Africans are already using some kind of mini-grid renewable energy.
Good regulation policy is crucial
Three things are absolutely essential to making solar power work in Africa – a sound regulatory network, master plans that would draw in local investors, and a sufficient number of entrepreneurs, Amin said. Governmental financing will also be needed to help cuts the risks to investors and keep interest rates low.
Snehar Shah, the director of solar company Azuri East Africa, which sells solar home systems, says, “Just as landline telephones once were the preserve of elites in Africa, now mobile telephones are now owned by nearly everyone, solar power presents much larger possibilities for expansion than grid power, ” according to the Economic Times.
Some African countries have already lowered or even removed duties on the import of solar equipment and appliances, while others, like Kenya, have set up attractive feed-in tariffs for renewables to attract investment in solar power plants.