Connected to promising potential – Opinion

Small-scale renewable energy projects are increasingly becoming a solution to Africa’s energy access problem.

Africa has a wealth of resources for its sustainable development. It has significant renewable energy potential, including solar, hydro, wind and geothermal, and has the capacity to produce large quantities of hydrogen. The continent also boasts significant mineral deposits used in new energy technologies for electric vehicles, stationary energy storage and green hydrogen (GH2) production, including cobalt, manganese, platinum, palladium and graphite, among others. Nevertheless, energy poverty remains a problem across the continent. Of the estimated 800 million people in the world without access to electricity, 600 million live in sub-Saharan Africa. Poor access to reliable, affordable and sustainable energy has become a major obstacle to economic development and human capital development across Africa.

Small-scale renewable energy is increasingly emerging as a solution to Africa’s energy access challenges. Shifting to cleaner energy sources will enable Africa to overcome the development and industrialization gap left by decades of energy poverty, provide needed energy services without harming human health or ecosystems, and leapfrog traditional electricity models by promoting off-grid and mini-grid energy solutions to provide greater accessibility.

Several factors are hindering renewable energy development in the region. Chief among them is the lack of a conducive policy environment. Several African countries do not have specific renewable energy policies, while others have dedicated policies that are outdated. Even when policies are effective, implementation can be inadequate due to weak governance structures and poor systems for communicating changes to governments. For companies, navigating government approvals and permits is a challenge, and projects can be plagued by delays and cost overruns.

Due to an inappropriate policy environment, many African countries have reduced investment in energy infrastructure, particularly in generation capacity, distribution networks and maintenance, which in turn leads to a combination of low energy supply and high electricity costs. Africa received only 3 percent of global energy investment between 2010 and 2020, with 0.5 percent of this investment going to transmission and distribution networks. It is estimated that at least $25 billion per year is needed in investment in electricity networks, generation and off-grid solutions to eliminate energy poverty in Africa by 2030.

Inadequate management and technical capacity also hinder the implementation of new technologies. Many African countries lacked the skills to design, install and maintain projects and systems. For example, renewable energy projects require not only initial installation but also ongoing maintenance, which can be technically demanding. Local staff do not always have the training or technological background necessary to effectively manage these systems, which can lead to poor performance or failure.

Over the years, China has become a major renewable energy power, leading the global energy transformation. Its clean energy investment has ranked first in the world for many consecutive years, and its installed hydropower, wind and photovoltaic capacity also ranks first. This technological advancement has become a new engine for China’s development cooperation with other countries in the Global South.

The Green Belt and Road Initiative and the Global Development Initiative have emphasized climate change and low-emission, green development. China’s export of photovoltaic modules and wind turbine equipment is an example of a solid strategy to disseminate sustainable technology and support African countries in increasing their use of renewable energy sources. China has also gradually shifted its investment toward green energy projects in Africa. According to the Boston University Global Development Policy Center, China has financed more than $13 billion and developed more than 10 gigawatts of clean energy across Africa since 2000. China’s investment in renewable energy in Africa grew at an average annual rate of 26 percent from 2010 to 2020, with solar, hydropower, and wind power being the three most important technologies.

China has also taken the approach of integrating capacity building with technology transfer to help overcome capacity constraints in Africa. This involves not only providing technology but also training local technicians and engineers to maintain and operate it. Projects include building low-carbon demonstration sites, climate change mitigation and adaptation projects, and building the capacity of local personnel. For example, the China-Africa Clean Energy Technology Demonstration Center in Kenya showcases clean energy technologies such as photovoltaics, wind power, and biomass energy, and provides technical training and advisory services to African countries. The China-Africa Green Development Fund provides financial support specifically for green technology projects in African countries. These programs ensure that technology transfer goes beyond simple installation and helps build a knowledge base in the community. Such a knowledge base can independently sustain these initiatives, thus addressing one of the critical barriers to the success of green projects in the region.

To further expand the scale and effectiveness of renewable energy cooperation between the two sides, China can develop a new cooperation model that encompasses multiple activities, which can achieve more sustainable effects than projects implemented separately.

First, China should improve its communication with Africa through multi-level and multi-dimensional channels. The role of think tanks, businesses and civil society groups should be strengthened. This would help understand the heterogeneity of the continent and the differences in the difficulties faced by each country, which are not uniform, and significantly increase China’s engagement with the energy sector of African countries beyond project-level interactions. It would also allow China to play a more active role in renewable energy advisory or consulting, capacity-building programs and dedicated efforts to improve the social and environmental footprint standards of many energy infrastructure projects. Sharing knowledge and skill sets in promoting the renewable energy market and technological capacity could be strengthened, including supporting the greenfield of wind turbine and solar panel industries and developing manufacturing and financial capabilities to achieve massive capacity installation in a limited time frame. Chinese companies and ministries can also actively engage in various capacity-building activities among African governments, in particular by engaging energy regulators in developing renewable energy capacity plans or roadmaps and establishing stable policy frameworks to support renewable energy development.

Second, China can encourage active local participation and ownership to foster an environment conducive to technology transfer. China can increase its own transparency through more effective data collection and regular reporting to counter disinformation and address negative environmental impacts when they arise. Removing the technical barriers that Chinese companies face in meeting global ESG standards will also enable more sustainable technology transfer between China and Africa and local and international acceptance. In addition, focusing on influential R&D partnerships and empowering local actors could drive a locally-led green technology innovation ecosystem in the region.

Third, China can leverage the potential of innovative financing. In the post-COVID-19 context, sovereign guarantees will become increasingly difficult to obtain from many African governments, which are struggling to service debt due to the pandemic and the resulting economic shocks. Renewable energy could be a very good pilot sector to encourage project financing and capital investment, as government auctions and public procurement have become the mainstream practice for wind and solar energy operations worldwide, including in Africa. China can leverage public funds to catalyze private investment. Instead of pooling financing project by project, a paradigm shift in establishing green development partnerships or funds with multilateral development banks could also help scale up efforts.

The author is vice president of the Center for International Knowledge on Development. The author contributed to this article at China Watch, a think tank supported by China Daily.

These views do not necessarily reflect the views of China Daily.

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