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Why Africa should not shy away from energy discourse

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The price of one litre of petrol stood at Sh179.160 as of January 16, according to globalpetrolprice.

The Energy and Petroleum Regulatory Authority (EPRA) figures however show that this time last year, a litre of petrol was sold for Sh127.46. This is a huge increase in a population that is badly-battered by hard times.

Across the border to the west, Uganda’s president Yoweri Museveni launched the country’s first oil drilling at Kingfisher Field Development Area. Dubbed LR8001, the 60.5 meter-tall Kingfisher oil rig was erected by the China National Offshore Oil Corporation (CNOOC) in 2022 and will enable the country to drill its first oil ahead of commercial production in 2025 by pumping out 40,000 barrels a day.

This is good news without a doubt for Uganda and the region, whose high prices are partly due to a lack of local oil production. What would the EPRA prices be reading if for example Kenya had gone full throttle and exploited her oil potential?

A look at geopolitics shows the important place oil is playing. The commodity is squarely at the centre of disagreements between the West and Russia, the initial reasons for the invasion of the latter to Ukraine notwithstanding.

There is no current platform where oil plays such an important role as in the climate change discourse.

The recent appointment of Sultan Al Jaber, Chief Executive Officer of the Abu Dhabi National Oil Company as COP28 President-designate has only confirmed what analysts world over have concluded; that the global battle lines in climate change discourse now firmly lean towards energy.

At last year’s 27th Conference of Parties held in Sharma El Sheikh, Egypt, Global Witness, a campaign group, found more than 600 people at the talks in Egypt are linked to fossil fuels.

That’s more than the combined delegations from the 10 most climate-impacted countries and a jump of 25 per cent from oil sector representatives that had attended the previous COP held in Glasgow, UK.

COPs have always attracted significant participants from the coal, oil, and gas industries interested in somewhat influencing the outcome of texts emanating from the talks so much that at COP27, Rachel Rose Jackson from the Corporate Accountability group of campaigners said COPs are turning into “fossil fuel industry trade shows”.

While COP 26’s Glasgow Pact started off by targeting the oil text with a phase-out of inefficient fossil fuel subsidies, in the end, this was changed to a phase-down in the final text.

Regardless of the position one takes energy, whether renewable or fossil fuel will in foreseeable future dominate discussions in COPs. In fact, in the recent past, the failure or success of COPs has been measured on the metrics and texts around energy.

Ahead of the World Economic Forum 2023 in Davos, Switzerland, Fatih Birol, the director of the IEA noted that the world is entering a new industrial age of clean energy technology.

Birol said the good news is that governments are taking action and competing to be leaders in the new energy economy. But as usual, the African continent appears to have chosen the backseat at the risk of perennially being visitors on the discussion tables and not a co-driver.

The continent is blessed with abundant energy resources (fossil fuel or renewable) and could be a major player in whichever side of the two divides it chooses.

Why energy matters to Africa

When over 1,000 villagers of Ndikir village in Marsabit County, which is about 450 km North East of Nairobi complain of lack of connection to the main grid, it is sad that millions of others across Sub-Saharan Africa suffer the same fate.

In fact, statistics show that sub-Saharan Africa has four times more people without electricity than anywhere else in the world. According to International Energy Agency (IEA), over 770 million people live without access to electricity on the continent. The IEA notes that Sub-Saharan Africa’s share of the global population without access to electricity rose to 77 per cent from 74 per cent periods before the Covid-19 pandemic in 2020.

To achieve full access by 2030, 100 million people must be connected each year. However, the world is not currently on track to reach this goal. In the IEA Stated Policies Scenario (STEPS) – a more conservative benchmark that looks at existing or announced policies – some 672 million are projected to remain without access in 2030, 85 per cent of whom will be in Africa. On the other hand, many developing countries in Asia are well on track to achieve near-universal access by 2030.

This acute energy poverty

This acute energy poverty has far-reaching consequences for critical development and environmental outcomes for struggling economies such as Kenya.

Yet, according to the WWF, Africa has the potential to install 310 gigawatts of clean renewable power—or half the continent’s total electricity generation capacity—to meet nearly a quarter of its energy needs by 2030.

Closing the energy access gap in sub-Saharan African countries will require an estimated annual investment of $35 billion up to 2030 or only 2 per cent of current global energy investment, according to the IEA. This includes about $13 billion for mini-grids; another $7.5 billion is needed for the grid and $6.5 billion for off-grid investments.

However, current investments in power access are well below this. The financing represents one of the major barriers to achieving global access since many of the projects require public support via concessional and blended finance structures, while low demand potential in some remote areas can deter private capital.

Tracked finance for electricity in the 20 countries that make up 80 per cent of the world’s population without electricity declined by 27 per cent in 2019. In 2021, Africa accounted for only 0.26 per cent of global green bond issuance, the lowest share of all global regions. And except for green loans, for which the continent accounted for about 1.9 per cent of global issuance by value in 2021.

Why Africa is still energy poor

The continent is hugely underfunded. There is hardly any access to capital worth mentioning. Most Renewable Energy Technologies (RETs) have much higher upfront investment costs. Making matters worse is the lack of legal and institutional frameworks to support new investments in renewable energy and if at all they do, they are still inadequate.

Africa is also a continent with limited technical and institutional capacity in the public and private sectors to implement and manage renewable energy investments.

This is compounded by the lack of awareness of the availability, benefits, and opportunities of renewable enegry within the public domain, inadequate standards and quality assurance for most such projects, and a lack of financing mechanisms to support the investments. There is also inadequate attention to research and development.

The role of civil society

What is it that civil society can do to support governments overwhelmed by the need to increase access to energy?

First, civil society organisations need to support policy reforms and actions such as those that favour lowering unmet energy needs.

One such reform that should be advocated for is for the governments to design incentive structures at national and sub-national levels to create an enabling environment for investment in energy, whether renewable or oil.

Such investment may lead to better and more modern refinery equipment for example, that could lower carbon emissions released into the air.

With the foregoing, Africa must come to the point of devising ways of grappling with unrivaled levels of energy poverty that stall growth and primarily affect the poor segments of its population.

My take is that the energy trajectory of the COPs is providing Africa with opportunities it could grab, negotiate for better technology transfer on matters of energy, and plug into market share left by the ban on Russian oil by the European Union.

[The writer is a climate change communication enthusiast and advisor] 

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