Regional Economic Integration can accelerate Africa’s Energy Transition

Energy production from non-renewable sources contributes significantly to total global greenhouse gas emissions. The emissions from the African continent are far less than from other regions. Yet, there is a worldwide consensus, through the Paris Agreement and the Agenda 2030, on the need to substantially increase the share of renewable energy and improve energy efficiency by 2030. Therefore, all countries that are signatories to the Paris Agreement are required to undertake a transition from fossil fuels such as oil and coal, towards renewable and environmentally friendly energy sources.

The main reason for this is environmental. But achieving reliable, sustainable and affordable energy is essential to reverse the vast energy supply shortages in Africa as well, such as catering to the growing population’s energy needs. Meeting the unmet energy demand can be a tool for economic growth, food security (by strengthening local agricultural resilience), and several other development outcomes.

Gaps and constraints to green energy development

Africa’s shift to green/renewable energy has been relatively sluggish compared to the global average. The slow adoption of green energy on the continent is attributed to many factors, among them:

• Lack of finance: The International Renewable Energy Agency (IRENA) estimates that Africa’s transition to green energy would require an annual investment of $70 billion over the next 15 years. African countries, which are mostly low-income economies, have limited financial resources to fund such assets at the required scale.
• Capacity deficits: The human and technical requirements of green energy production range from highly-skilled, technical elements (research and development, manufacturing), to medium and low skill elements (operation and maintenance). African countries face both a technical and human capacity constraint. Also, the appropriate technologies for exploiting available renewable energy sources are insufficient.
• Fossil fuel subsidies: Fossil fuels are subsidised in many African countries. Such policies encourage its continuous use. Also, some renewable energy sources like hydropower are shared resources. This situation could limit its use for energy generation, in particular when intense competition exists with other sectors or among countries.