Renewable energy is a rich opportunity for Africa

There was a great deal of drum beating at the African Energy Week this year as delegates rallied to the plight of 600 million Africans with no access to regular electricity by pledging to exploit the continent’s unexplored oil and gas resources as fast as possible.

That there is a need for universal access to electricity in Africa is beyond dispute, with most of those 600 million people living in sub-Saharan countries.

Even in South Africa, where electricity access is close to 100%, the high price means that many families need to burn paraffin or wood for cooking and heating and will use electricity only for lighting.

The point that concerned me most through the conference, however, was the zeal that government leaders, including our own Mineral Resources and Energy MInister Gwede Mantashe, and other industry speakers at the conference were putting into their resolve that the continent should be allowed to ignore the route that the rest of the world is following, in addressing climate change and the energy transition.

Don’t get me wrong, each speaker mentioned that “of course we must invest in solar and wind energy”, but it was literally just those words, and no further mention was made of these type of investments.

It was as if there had been a tacit decision made at the conference that issues relating to renewable energy rather be addressed at another conference.

The common mantra at this year’s African Energy Week conference was that Africa’s contribution to global warming was minimal, and its development requirements far exceed the need to stop the continent’s further exploitation of carbon burning fossil fuels.

And indeed, Namibia was showcased as a fine example, where recent massive offshore oil and gas finds means that it is planning to grow its economy sharply in the short term.

African leaders are beating this drum because it is becoming increasingly difficult for oil and gas companies to get new international finance for exploration and the construction of new petro-chemical facilities.

This is even though oil and coal markets generally remain strong.

For many African economies, this type of investment is a key element of their national budgets. Also there remain, although unproven, large reservoirs of petrochemical commodities and other minerals that could be potentially exploited on the continent.

Many African economies, including South Africa, are struggling with high debt, and with international donor funding drying up due to the low growth and high interest rate environment in developed countries, inward investment and greater export flows has become an urgent priority for these countries.

The problem is that the leadership of our African countries may be once again be denying their people a chance to catch up with the long-term developmental direction of the world, in exchange for short-term financial gratification.

The automotive industry is a good example here. South Africa’s biggest manufacturing sector is the motor industry, and vehicle assembly plants only survive in this country because they can also produce vehicles for export markets.

They do this by becoming part of their parent’s global production strategies.

On its own, the South African vehicle market does not justify the investment required in a vehicle manufacturing plant. So, in the not too distant future, South Africa’s vehicle market will have to also change to accommodate electric vehicles.

In the fast-moving world of cellphone technology, African markets have been adept at leap-frogging old technologies in favour of the latest lower cost technology, such as the early adoption of cellphone banking in many markets.

How could this have occurred if their governments had instead promoted the continued use of fixed line telephones simply because the country had great deposits of copper to make cheaper telephone cables.

In this context, renewable energy development is an opportunity to step into the future.

There are some climate change factors to consider. Climate change knows no boundaries. Greenhouse gas accumulation has been through the burning of commodities, and use of raw material inputs for industry, that have by far mainly been bought from developing countries.

For African countries to now claim Nimby (not in my back yard), seems disingenuous.

Of course I am not saying shut down the coal power stations, or that we mustn’t use the gas that we can get at cheaply to generate electricity.

But at a conference that claims to represent energy development for the continent, there needed to be more emphasis on renewables by the main speakers.