The challenges and growth potential of the renewable energy sector in Sub-Saharan Africa

Sub-Saharan Africa is home to some of the world’s most pressing energy challenges. The region lies south of the Sahara and includes Central, East, West, and Southern Africa. The region has abundant renewable energy resources, including solar, wind, hydro, and geothermal, which could provide a sustainable and affordable source of energy for the region.

But despite the great energy potential, according to the International Energy Agency (IEA), over 600 million people in the region lack access to electricity, and many more suffer from unreliable and expensive energy supply.

One of the main barriers to the development of renewable energy in Sub-Saharan Africa is the lack of access to finance. Most renewable energy projects require significant upfront capital investment, which can be a major obstacle for investors, particularly in countries with limited financial resources. Moreover, the high perceived risk of investing in Africa can deter international investors.

The limited infrastructure in many parts of Sub-Saharan Africa also poses a significant challenge for the development of renewable energy. For example, in rural areas, the lack of infrastructure can make it difficult to connect renewable energy projects to the grid, while in urban areas, the aging infrastructure may not be able to handle the increased energy demand.

Another challenge facing the renewable energy sector in Sub-Saharan Africa is the lack of clear policies and regulatory frameworks that support its development. The absence of a supportive regulatory framework can deter investors and make it difficult for them to navigate the market. Furthermore, regulatory uncertainties can affect the long-term viability of projects and discourage innovation.

The shortage of technical expertise in many African countries can also limit the ability of local companies and governments to build and operate renewable energy projects. This can lead to a dependence on foreign companies and experts, which can be expensive and unsustainable in the long run.

Electrification rates across end-use sectors, even though are on the rise since 2017, remain very low. In the transport and building sectors, electrification is at 1% and 4%, making this part of Africa the least electrified part of the world.

Fossil fuels account for most remaining energy sources, with high shares of oil and coal and a growing share of natural gas. This African region also suffers from severe grid reliability issues, with frequent and prolonged blackouts resulting in a high dependence on expensive and polluting backup generators.

Renewable energy plays a small but growing role in the energy mix. According to the International Renewable Energy Agency (IRENA), the region has the potential to generate up to 310 GW of renewable energy by 2030, with solar energy alone accounting for up to 165 GW. Nowadays, only 10% of hydropower potential is being exploited, while this region has excellent solar potential and a coast that holds potential for wind energy.

Because of this potential for the growth of renewable energy, sub-Saharan Africa has already started to unlock its vast renewable energy resources.  The demand for energy in Sub-Saharan Africa is expected to grow significantly in the coming decades due to population growth and economic development. According to the IEA, the region’s energy demand is projected to double by 2040, with electricity demand growing at twice the rate of the population. The goal is that two-thirds of the mini-grid and off-grid systems in rural areas in 2040 are powered by solar photovoltaics, small hydropower, or wind. Also, actions are being taken for geothermal to become the second-largest source of power supply in East Africa, mainly in Kenya and Ethiopia.

Several international initiatives are supporting the development of renewable energy in Sub-Saharan Africa. For example, the United Nations Sustainable Energy for All (SE4All) initiative aims to ensure universal access to modern energy services by 2030. The African Renewable Energy Initiative (AREI) is another initiative that aims to achieve 10 GW of new and additional renewable energy capacity by 2020 and up to 300 GW by 2030.

Other actions that contribute to Africa’s growing energy economy are:

• Money investments in the power sector.
• Cooperation on energy projects.
• Better resource and energy-based revenue management.

The goal is to boost the region’s economy by 30% by 2040 in a sustainable way and to see a considerable rise in renewable energy in Sub-Saharan Africa which will have a positive effect on the whole world.