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Energy technologies: who will pay for Africa?

By Michael Adekanbi

Dec 09 2021 · 4 min read

Illuminem Voices
Energy · Environmental Sustainability

As a result of the continuous industrial and global advancement, the last decade has witnessed a surge in new technologies and this applies hugely to the energy sector. Racing towards meeting the United Nations SDG 7 goal and the Paris Agreement of UNFCCC (United Nations Framework Convention on Climate Change) has led to the emergence of new energy technologies that can help the world attain this feat. Conventional energy technologies are also being continuously optimized as the world needs to deploy every available resource to improve energy access in some developing countries and also save humanity from the repercussions of environmentally dangerous acts. This includes the emission of greenhouse gases. The energy sectors of some developing countries need overhauling as the failure of electricity and the rate of carbon emissions of these countries is overwhelming. This reality applies to a large percentage of the countries in Africa, especially the Subsaharan region. Technologies like Small Modular Reactors, Electric Vehicles, Hydrogen Technologies, and Concentrating Solar Powers are foreign to most Africans. Although these technologies give a measure of hope in mitigating issues like global warming and other problems associated with climate change, they exist solely on pieces of literature in most developing countries and only the elites who have the privilege to travel to countries in Europe, North and South America as well as other developed regions have experiential knowledge about these technologies. The Nigerian government passed a bill in 2019 targeted at placing a ban on the number of fossil-based electrical generators in the country. It did not work out as many homes and firms depend on generators as their source of power. It was frowned at by many people. In some parts of Africa, having some houses disconnected from the grid due to their incapacitation to pay electricity bills is a common practice. The electricity distribution companies do roam about streets to disconnect defaulters and this adds to the number of people that do not even have access to the grid in the first place.

It is a fact that all things come at a cost and sophisticated technologies are often expensive. Having a large chunk of the inhabitants of a country living at the base of the pyramid is a norm in most African countries. For example, Nigeria has about 39 % of its population, equivalent to about 79 million persons, living below 1.9 US Dollars per day. The case is even worse in countries like Eritrea, Madagascar, Zimbabwe, Burundi, e.t.c. The national income of these countries is not even at par with the worth of some individuals or establishments. Since the goal of the world is total decarbonization of everywhere, developing countries cannot be left out in the pursuit of attaining a perfectly clean environment.

Sustainable energy projects are capital intensive and also require substantial funds for upfront expenses. For example, Nigeria allots about 333 million US dollars to the power sector yearly, which is insufficient as there are still off-grid areas. This same budget would only enable the country to set up a photovoltaic system with an average capacity of 166 megawatts as the cost of installing solar systems falls within the range of 2000 to 3700 US dollars per kilowatt. Since developing economies have the culture of prioritizing cheap options and minimal expenditures, abandoning the already established energy infrastructures to set up new ones would be considered wasteful. Therefore, most countries would be reluctant to subscribe to the full adoption of renewable energy technologies. Another factor that contributes to the high expenses incurred during sustainable energy installation is the fact that some countries do not have the technical expertise or capacity to manufacture renewable energy components and they rely on importation from other countries. Hence, the complete transition to sustainable energy schemes is not realistic unless developing economies are helped. The question of "Who will pay for Africa?" then comes to mind.

With several economies entering into the recessive state because of the pandemic and different variants of the covid virus transitioning into waves, most countries are prompt to pull a large share of every available resource to their health sector. The hope of reaching the United Nation's SDG 7 by 2030 appears bleak as countries like Madagascar even rank well on the world poverty ranking before the pandemic. Hence, it is predictable that the country's resource bank would have suffered much more fatal damage and will leave her government to only attend to issues on a priority basis. Organizations like USAID, Africa Development Bank (AFDB), and Power Africa are launching several electrification projects in Africa to salvage the energy scarcity facing the region. This often comes in the form of rural electrification projects, mini-grids, grants to energy startups, and several others. These projects being funded and launched by these organizations rarely include the latest energy technologies and the development of these innovations could spur a speedy improvement in the energy sector of these countries. Since these organizations are yet to take the onus of launching a full deployment of these novel technologies, thoughts like "Will the government spearhead enhanced energy projects?", "Will big companies pay for the deployment of novel energy technologies in Africa?", "Will USAID and other NGOs change direction and kickstart projects involving Small Modular Reactors or Hydrogen Energy in Africa?" and several other questions ravages the mind of an average clean energy advocate.

Energy Voices is a democratic space presenting the thoughts and opinions of leading Energy & Sustainability writers, their opinions do not necessarily represent those of illuminem.

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About the author

Michael Adekanbi is a research associate at Reeddi and a Student Energy Leaders Fellow.

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