A clean power initiative for Africa

Project profile
February 19, 2016

300GW of renewable energy capacity by 2030. This is the ambitious target which the Africa Renewable Energy Initiative (AREI) has set itself to boost renewable energy investment and bring power to 645 million people in Africa without electricity.

Africa has huge renewables potential, with the African Development Bank (AfDB) estimating 10TW of solar, 110GW of wind, 350GW of hydro and 15GW of geothermal. However, given that a recent estimate put Africa’s current generating output at 147GW from all energy sources, there is a long way to go to hit the 300GW target. Falling technology costs and the clear signal of a shift to a low carbon economy provided by the Paris Agreement reached at COP21 – see our previous post on COP21 -  will help to accelerate renewables deployment in less developed renewables markets, but a significant scaling up of finance and a strong bankable project pipeline will be critical to success.  

Launched to a packed Africa Pavilion at COP21, the AREI has now won over US$10 billion in support from governments, multilateral development banks, the UNFCCC’s Green Climate Fund and the private sector. This is a good start, but a total investment of at least double that is needed to reach the AREI’s interim goal to add 10GW of new renewable capacity by 2020, and an estimated US$500 billion will be needed in order to come close to meeting the 300GW goal.  

Whilst there is a long list of initiatives to power Africa, the AREI is the most ambitious Africa-led initiative focusing solely on Africa’s renewables potential.  Led by a partnership of African agencies, the AfDB, the UN Environment Program (UNEP), and the International Renewable Energy Agency (IRENA), and backed by the G7 and the G20, the AREI has the potential to be a powerful spearhead for the acceleration of renewable power.

Limited details are available of how the 300GW target will be achieved at this stage but it’s anticipated that detailed country plans, policies and incentives will be devised in the run-up to 2020, for implementation up to 2030, and that off grid generation will play a key role. The initial pipeline of projects to achieve the 10GW goal should be selected by mid-2016.

The AREI recently received a boost from the AfDB’s launch of a complementary initiative at the World Economic Forum in Davos. The New Deal for Energy in Africa seeks to bring together governments, the private sector and multilateral energy initiatives to achieve universal access to energy in Africa by 2025, with a core goal of adding 160GW in new capacity by 2025. The AfDB has committed to investing US$12 billion in energy between 2016 and 2020 and to leveraging a further US$50 billion in energy investments from public and private sources. Whilst this funding is not renewables-specific, a significant proportion is expected to be channelled into clean energy projects.

Both the AREI and the New Deal initiatives recognise the need to mobilise finance, drive regulatory reform to encourage investment and to coordinate the multitude of public, private and multilateral initiatives to maximise their impact. The two initiatives will be looking to lessons learned from the success of renewable energy programmes and projects in established renewables markets in Africa, such as South Africa’s hugely successful Renewable Energy Independent Power Producer Procurement Programme (REIPPP), Morocco’s CSP Programme and Rwanda’s trail-blazing utility-scale solar project developed by Gigawatt Global to accelerate renewable energy deployment in less developed African energy markets.