Innovation as a driver for Africa’s energy transition

Africa’s energy transition is a complex process. As a continent, we are still facing massive challenges in energy access and energy infrastructure as well. Until today, around 570 million people in sub-Saharan Africa still lack access to electricity – that’s more than the entire population of the European Union! Access to clean cooking is also very low, estimated at 16% only in sub-Saharan Africa, and on an annual basis, there are nearly half a million premature deaths due to indoor air pollution. At the same time, the electricity infrastructure in most African countries is underdeveloped and cannot cope with large shares of variable renewables – this has been a major barrier for renewables penetration. All of these challenges are exacerbated with the impacts of climate change that have made many African cities very vulnerable to extreme weather conditions. So, what can be done?

Addressing all these challenges requires more than just rapid deployment of renewable energy and energy efficiency technologies. We need to integrate the concept of “innovation” in the long-term planning and strategies for the energy transition in Africa. Our approach towards innovation needs to encompass technology, business models, and market structure.

Innovative enabling technologies play a key role in ensuring Africa’s future electricity system’s flexibility in integrating large shares of variable renewable energy. Utility-scale batteries are a prime example here, due to their role in load shifting, provision of ancillary services for grid operators, and their contribution in deferring investments in the transmission and distribution network upgrades. Rapid developments in utility-scale batteries technologies have resulted in costs reducing by 80% between 2010 and 2017 according to the International Renewable Energy Agency (IRENA). Digital technologies such as IoT, AI, and Big Data also play a major role in Africa’s future electricity system by increasing system flexibility, improve the accuracy of renewable energy generation forecasting, and reduce operating costs for power generation assets. Electric mobility innovations are also instrumental for Africa, not just for reducing emissions, but also to increase the grid flexibility. Smart EVs charging and Vehicles-to-Grid technologies can help reduce renewables curtailment and also improve the system’s flexibility by supplying power back to the grid when required. Advancements in green Hydrogen production technologies have the potential to transform Africa’s energy system and support the decarbonization of major industrial sectors such as steel. Electrolysers technologies are rapidly developing in scale and it is expected their cost will reduce by 50% by 2040 to 2050.

Transforming Africa’s future electricity system also requires innovative approaches in the electricity market business models. As more consumers start generating their own energy from distributed generation sources, they effectively become prosumers and can then sell electricity to the wholesale market and even provide some ancillary services to grid operators. This model is known as aggregators or virtual power plants and several countries in the EU have already established regulations to promote it. Energy-as-a-service is another model that can revolutionize Africa’s electricity market, by integrating a range of renewable energy technologies with software and data analytics to provide the customer with comprehensive services such as demand side management and smart home solutions. Other models that Africa needs to develop include community ownership and pay-as-you-go, which both can make investment in renewables more affordable to the end consumer.

Paving the way for rapid deployment of renewables in Africa also requires innovations in the electricity market design. African countries can greatly improve their grids’ flexibility and reduce the need for operating reserves and curtailment by leveraging their regional interconnections and power pools. Unfortunately, the lack of aligned policies and regulations has hindered African countries from fully utilizing their grid interconnections. Until today, only the South African Power Pool has a functioning market and across African’s five power pools, the share of trade in total electricity demand is less than 10%. African countries need to improve their trading regulations, energy wheeling methodologies, and develop an attractive environment for private investments in the electricity transmission and distribution market.

Enabling a swift energy transition in Africa requires policymakers to develop long-term strategies and robust policy frameworks that anticipate the future developments in technology, market structures, and demand patterns. Long-term energy strategies should encourage collaboration between academic institutions and the industry in developing innovative technologies, business models, and market structures that respond to Africa’s unique challenges. Moreover, African academic and scientific institutions need to develop unique programs that train the next generation of innovators and energy leaders.

To conclude, innovation is a key driver for Africa’s energy transition and through supporting policy frameworks, strong local capacity, and sustainable international partnerships, Africa is well positioned to unlock its wealth and prosperity.

Dr. Mohamed Alhaj, Founder & Director, Clean Energy 4 Africa, Chairman of the Youth Task Force, RES4Africa Foundation

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Africa is a continent in continuous transformation, with a sustained economic and population growth, a fast-paced urbanization and a young generation of talents who is leading its business revolution. This transformation requires energy and will require it even more in the next decades.
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