Featured image: Stock

While solar energy is often covered in the media, wind energy is still relatively unknown, at best only mentioned in generic terms. What is then the state of the wind energy market in Africa? Tony Tiyou, Director of Renewables in Africa, addresses this question in five strategic points.

This article originally appeared in Issue 1/2018 of our Renewable Energy Supplement in the print magazine. The digital version of the full magazine can be read online or downloaded free of charge.

Historically, hydropower has been the longest-standing and largest green energy source used in Africa’s electricity supply industry, but the last two decades have seen the rise in fortune of solar and wind. However, the wind energy market in Africa is perceived as lagging behind other clean power technologies – understanding the market can blow this perception away.

Where is the best potential for wind in Africa?

The answer could be found by accessing publicly available portals like IRENA Global Atlas to localise the best wind resources by applying the right filter. However, for improved accuracy it is essential to specify what kind of potential is referred to as there is a clear difference between the theoretical potential and the technical potential.

If the first kind grossly refers to the amount of resources available without taking into account spatial restrictions and the relevant conversion efficiencies of the system, the second is worked out from taking into consideration all these losses. For Africa, to our knowledge, no in-depth evaluation looking at what is technically and economically achievable has yet been undertaken. The best way to respond to the question would be instead to look at the geographical potential that considers areas that are suitable for wind energy deployment.

Areas with CF

greater than 30%

Areas with CF

greater than 40%

Region Total area (km2) TWh/year TWh/year
Central Africa 5,317,718 1,576.7 578.3
Western Africa 5,006,014 1,692.2 58.8
Eastern Africa 6,225,847 30,860 16,580.5
Southern Africa 6,555,480 10,011.1 1,707.3
Northern Africa 6,784,934 22,500.9 6,919.9

Table 1: Wind energy potential in Africa

Table 1 presents the potential across the five African blocks taking a capacity factor (CF) into consideration.

Whether considering a CF (the fraction of the year the turbine generator is operated at rated power) of 30% or 40%, Eastern Africa, with an extended coastline forming strong winds, has the biggest potential. To put things into perspective, as mentioned in the book: Wind Energy Outlook in Africa, the potential at 30% CF (30,860TWh) alone would cover more than 51 times the entire electricity demand of Africa in 2012, which was 605TWh. A statistic certainly worth remembering.

How big is Africa’s wind energy market?

The wind industry in Africa is still small and concentrated, although substantial progress has been observed over the last ten years. In August 2017, the total capacity was recorded at 4.1GW, the equivalent of four conventional nuclear power plants. This figure is slightly below the 1% mark of the cumulative global capacity according to the Global Wind Energy Council (GWEC) but still an almost 300% increase from 1.1GW in 2011. The South African REIPPPP, launched in 2011, is mainly responsible for this marked expansion.

The country is by far the biggest producer with more than 1.6GW of operational wind energy capacity, followed by Morocco and Egypt. The two latter countries are progressively recovering from the Arab spring that has put a halt on local industries. An interesting fact is that Egypt was at the forefront of the industry back in the 1980s and the first sizeable project it built was a 4-turbine wind farm with a capacity of 400kW.

What are the main challenges?

Challenges faced by the industry are three-fold: policy, technical and economic.

Policy challenges

Like any sector, the wind industry requires clear strategic and regulatory framework to be able to thrive. With the exception of the North African countries and South Africa, no other country has implemented a clear plan to boost the industry. Under the momentum of international agreements like the Paris Accord, 34 out of the 55 African nations have established renewable energy targets – some even going further with a quota for wind – but there is still a big discrepancy with implementation plans.

Technical challenges

Like solar, wind is an intermittent energy source that cannot easily be predicted. In addition to that, wind does not have storage capacities. These two shortcomings mainly explain why wind is not considered at the moment reliable enough for baseload supply. Electricity per se cannot be stored so the whole management exercise is about balancing supply and demand. When the wind blows over the Ashegoda Wind farm and delivers 300MW to the grid, Ethiopia needs to carry that load to a destination whether or not a customer has been identified, whether or not the transmission and distribution system can absorb it. This is a glimpse of the integration problems African networks endure.

Economic challenges

Assessing the economic viability of wind power generation is certainly paramount in evaluating the growth potential of the wind industry. Renewable energy costs have decreased in general over the years but capital costs are still the major financial issue. The levelised cost of energy (LCOE) for wind globally may have dropped to $59 per MWh but capital costs still represent most of the budget, in many cases at least 75%.

Furthermore, the intermittency of the resource implies that robust wind farms require significant back-up plans.

What is the cost of producing wind energy in Africa?

The answer to this question is surely the most anticipated one that investors and developers are eager to find out. Disappointingly, the relatively limited amount of supplied information and the reduced size of projects mapped across the continent (approximately 100 projects in total in 2017) does not allow for meaningful conclusions to be drawn from project cost analyses. No general trend for wind projects in Africa could be made at this point but some observations from certain regions can add insight.

In North Africa, a simple unit cost analysis of major projects seems to indicate a cost of $1.80 million per MW. In this region, several projects have been implemented in close proximity, significantly reducing the need for new, ancillary infrastructure. In East Africa and Southern Africa, the unit price jumps to $2.2 million per MW. In South Africa, the four rounds of the REIPPPP auction system have driven costs down.

According to the Council for Scientific and Industrial Research (CSIR), new wind power generation costs have dropped from R1.51/kWh ($0.13) for the first bid window in November 2011 to R0.62/kWh ($0.052) for the fourth bid window (Figure 1), a reduction of almost 60%.

What are the prospects for wind in Africa?

According to the IEA, African grid-based power generation was 158GW in 2012. A projection of the current capacity of wind power generation would mean that the sector represents only 2.5% of the production.

McKinsey and the IEA forecasts are predicting that by 2040, while the population in sub-Saharan Africa will double and the economy will grow by a factor of four, the energy demand will significantly increase by around 80% under the effects of clean energy policies. Taking a demand-driven approach, the total power generation capacity will quadruple to 385GW, from 90GW in 2012.

Breaking this demand into contribution per fuel, it is again noticeable from Figure 2 that wind is making up only 2% of the market, which equates to around 8GW of capacity and 32TWh of energy to be generated. What is striking about this analysis is that while the potential for wind in Africa is enormous, the resources are clearly underutilised, and the sector lacks ambition. What could transform the industry is a bold and holistic vision that would look at and integrate aspects together, as well as initiatives to boost knowledge and regional capabilities. With strong will and leadership Africa has the tools to change the paradigm and catapult wind into another success story – just like the mobile industry yesterday, and solar today.

This article originally appeared in Issue 1/2018 of our Renewable Energy Supplement in the print magazine. The digital version of the full magazine can be read online or downloaded free of charge.