Africa Clean Energy Corridor

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1 Africa Clean Energy Corridor Gurbuz Gonul IRENA Country Support and Partnerships ACEC Policy Consultative Forum Meeting 4 October 2015

2 Africa Clean Energy Corridor (ACEC) Develop RE resources and integrate renewable power into grid Promote cross-border trade of renewable power SAPP and EAPP Build on PIDA as well as SAPP and EAPP work (WAPP from now on) WAPP

3 Political Support to ACEC Jan 2014 Ministerial Communique signed to endorse ACEC Action Agenda Today Supported by more than 30 countries, development partners, regional organizations, IFIs, and private sector

4 ACEC West Africa Sep 2015, Abidjan Kick-off Meeting Strong support expressed by all 15 ECOWAS countries, ECOWAS Secretariat, ECREEE, WAPP, ERERA, AfDB and other stakeholders

5 ACEC and Climate Change Sep 2014: UN Climate Summit ACEC announced as an area for collaborative action with an immense potential for transforming the energy sector and contributing to climate change action. Dec 2015: COP21 in Paris ACEC to feature for demonstration of renewable energy as a crucial part of any viable solution for climate change.

6 ACEC Action Agenda Zoning and Resource Assessment Identification of high resource zones for RE development. National and Regional Planning Consideration of cost-effective RE options for power generation in national and regional plans. Enabling Frameworks for Investment Opening markets to IPPs, reducing the costs of RE financing and facilitating power trade. Capacity Building Development of skills to build, plan, operate, power grids with higher RE shares. Public Information Awareness raising and promotion of the ACEC and its benefit. 6

7 Resource Assessment and Zoning High potential and cost-effective zones identified in all countries. ACEC countries started actively using zoning outcomes. Zoning results incorporated into EAPP Energy Master Plan. Validation of identified zones underway in pilot country. Zones under further development for decentralised solutions.

8 National and Regional Planning SPLAT least cost planning tool implemented in the power sector of ACEC region. Investment needs 2015 to 2030: - USD bn/yr in generation - USD 15 bn for T&D

9 Enabling Frameworks Renewables Readiness Assessment and Advisory Policy, legislative and institutional guidance and support completed (9) ongoing / planned (5) 9

10 Enabling Frameworks Regulatory Empowerment Project 1. Planning Governance Support regulators in management of power system plans with wider role of RE 2. Capacity Building 1 st IRENA Renewable Energy Training Week Jan 2015, Abu Dhabi 1 st AFRICA Renewable Energy Training Week Oct 2015, Tanzania 3. Governance of Regulatory Institutions 4. Tariffs and Incentives 5. System Code Governance

11 Enabling Frameworks Sustainable Energy Marketplace Support for project initiation & development and channeling financing Project Owner A Project Owner B Project Owner C Project 1 Project 2 Project 3 Project 4 Project 5 Project 6 Project 7 Project 8 Project N Service providers Projects Governments Technical Financing Legal EPC, O&M Other Expertise Market Place Financing Enabling environment, facilitation Enabling frameworks Investment opportunities Country level facilitation Equity Mezzanine Loan Guarantee Grant Utilities Industrials / IPP Private Equity Commercial Banks ECAs Public Finance

12 FACILITATION ANALYSIS IRENA s Value Added Resource Assessment & Zoning RRA & Advisory REmap, SPLAT RESource & other Databases Technical potential; Identification of suitable areas Regulatory and investment environment Commercial market potential and planning Market statistics; Policy database; Global Atlas Stream of bankable projects and financial closings Policy dialogue amongst stakeholders Enabling investment environment Support in project development and facilitating financing Skills and knowledge Communication Consultative Forum Regulator & Utility Cooperation Project Facilitation Platform & Project Navigator Capacity Building Awareness Raising

13 ACEC Consultative Forum Aim: Facilitate strategic policy dialogue among ACEC stakeholders Exchange on the progress in the ACEC implementation Develop and enhance institutional partnerships Cooperate and coordinate with other international, regional RE initiatives Collaborate with SE Marketplace to identify investment opportunities 13

14 Thank you. 14

15 Enabling Frameworks Renewables Readiness Assessment and Advisory Policy, legislative and institutional guidance and support SWAZILAND MOZAMBIQUE DJIBOUTI Grid RE Code resources MOZAMBIQUE and RE mapping IPP for policy the whole adopted SWAZILAND country (four done PPAs signed) RE feed-in-tariffs ZAMBIA adopted RE integrated into national Rural Electrification energy o policy TANZANIA and legislation Strategy revised with focus Integrated o ZIMBABWE on RE by resource private sector planning o EGYPT under development 15

16 Enabling Frameworks Renewables Readiness Assessment and Advisory Policy, legislative and institutional guidance and support DJIBOUTI ZAMBIA RE RRA resources used for mapped guidance and for geothermal feed-in-tariffs adopted development Integrated Exemption resource from import planning duty for RE under equipment development enforced RE integrated into Electricity Master Plan16

17 Power generation capacity in 2013 Oil Other 68 GW Other Other RE Oil Coal Hydro Gas Hydro Gas 19 GW Other Other RE Biomas s Coal Gas Oil Oil Gas 4 GW 11 GW Hydro Hydro 58 GW Nuclea r Hydro Oil Biomas s * Other RE includes solar, wind and geothermal Other includes waste heat and blast furnace gas Gas Coal 17

18 RE Resources in Africa Detailed GIS analysis shows abundant but regionally different RE power generation potentials Geothermal < 100 TWh/yr Biomass > TWh/yr 18

19 Renewable power generation is increasingly competitive

20 Levelized cost of electricity Africa [USD/kWh] 0.6 Hydro, biomass, wind, geothermal cheaper than solar but not available everywhere High capital cost Low resource quality Low capital cost High resource quality Diesel generators Gas/coal Plant (excl T&D cost) 20

21 Why ACEC? Growing electricity demand mainly in fast growing economies of the Continent High untapped Renewable Energy (RE) potential Huge reliance on fossil fuels for electricity generation in most countries Economic growth is stifled by power shortages and outages Ongoing effort to interconnect power grids through Transmission links Promotion of RE power generation and cross border trade of RE power.

22 Africa: Power needed to fuel economic growth GDP growth in 2012: 4.3 % Current electricity mix: Sub-Saharan Africa 2.4 % World average By 2035 x4 By 2035 x3

23 Capacity Building Develop skills and strengthen institutions to build, plan, operate, maintain and govern power grids and markets with higher shares of renewable electricity. - Training workshops held for RE Zoning, SPLAT planning, governance frameworks, rid integration of RE. - Practitioner s Guide for grid integration of variable RE developed.