Infrastructure expansion is key to Africa's energy transition. Featured image: Pixabay.

Economic Commission for Africa’s executive secretary, Vera Songwe, says the continent’s main issue when it comes to energy was not that of transition, but energy substitution.

During a Res4Africa webinar on scaling up renewable energy investments in Africa, Songwe said Africa needs to focus on three aspects to ensure the continent has enough energy to power its post-COVID-19 rebuilding efforts – infrastructure, supply, and cost of energy.

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She said following the outbreak of the pandemic, trade, education and health activities had moved to ICT platforms, consuming about 40% of the continent’s energy.

“So for us to be able to have on the continent a viable ICT sector that will allow our economies to build back better, we are going to need a lot of energy,” said Songwe.

She believes private investments will play a crucial role, especially with the launch of the Africa Continental Free Trade Area (AfCFTA).

“We do not have the transition problem on the kind of scale that Europe has. The conversation for Africa is around substituting expensive bad fossil fuels into something that is cleaner and most certainly cheaper. We have to replace fuel-based energies with green and sustainable ones,” said Songwe.

For her, partnerships and cooperation were needed to support African countries to deliver on their energy and development agendas: “We need to begin to honestly and seriously looking at the financing structures of Africa’s infrastructure. We are financing infrastructure at shorter time frames than it takes to build that infrastructure, resulting in debt sustainability issues,” said Songwe.

She pointed out that Uganda and Seychelles are the only African countries with viable electricity sectors, with 19 nations’ electricity sectors operating at expenditure and the rest at excessive losses. For her, one part of the problem is the continent’s tariffs are not cost-reflective.

She said the continent needs to work collectively to ensure regional power pools are viable, but added the caveat: “Not every African country can produce energy.” Songwe believes the private sector can invest in regional power pools through AfCFTA and that local currency energy investments would greatly boost access to affordable energy on the continent.

Climate change mitigation and socio-economic development post pandemic

Francesco La Camera, Director Generation of the International Renewable Energy Agency (IRENA) said Africa’s energy decisions are pivotal to climate change mitigation and socio-economic development. He puts the energy transition central to any post COVID-19 recovery, the 2030 Agenda for Sustainable Development and Africa’s long-term prosperity.

“The need to electrify cities in a sustainable way must be the core of government strategies,” he said, adding there was an urgent need to ensure “the ruling class addresses the perception of risks that investors still have in some parts of Africa”. For his part, Amith Singh, Head of Energy Finance at Nedbank in South Africa, said; “If we really want to see Africa’s renewable power being developed, we need global initiatives that can leverage cooperation and investment.”

Singh said Europe can mitigate risks in African countries with sustainable programmes that can encourage the development of new policies, capacity building, local manufacturing and provide financial assistance.