Africa s Energy Demand GDP will grow fold between 2013 and 2030

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1 SAIREC side event, Cape Town, 4 th October, 2015

2 Africa s Energy Demand GDP will grow fold between 2013 and Electricity would increase more than 3 fold Biofuel and waste: significant potential to modernize its use Modern renewables would replace a part of fossil fuels demand Total Final Energy Consumption (TFEC) 23 EJ in 2013 A doubling of TFEC to 45 EJ in 2030

3 Renewable energy use in 2013 Modern RE 1.1 EJ Total TFEC 23 EJ Traditional biomass 11.8 EJ 10% modern renewables, 90% traditional biomass 3

4 REmap options in 2030 Traditional biomass 3.4 EJ Modern RE 9.6 EJ Share of modern RE use in TFEC increases from 5% in 2013 to 22% in

5 Diversified power generation mix Total installed capacity by 2030: 610 GW, up to 310 GW renewables more than an 8-fold increase REmap options Hydro: 100 GW Wind: 100 GW Solar PV: 55 GW CSP: 38 GW Biomass: 32 GW Generation mix in 2013 and with REmap options Wind Solar Hydro RE 2030 energy mix to be characterized by diversified power sources

6 Renewables provide affordable power Recent project deals Solar PV in South Africa: USD 7.5 cent per kwh CSP in South Africa: USD 12.4 cent per kwh Wind in Egypt: USD 4.1 cent per kwh Among most competitive in the world Investment needs between 2015 and 2030: 70 billion per year for the power sector including 7 billion for hydro 25 billion for other renewable generation options 25 billion for T&D 6

7 A low carbon growth path: Power sector Mt savings CO 2 emission stabilization % reduction compared to Reference A potential source of financing

8 Fuelling industrial growth and driving life style change 60% reduction in # of traditional cookstoves 2% 8

9 Way forward 14 recommendations: Creating an enabling policy and regulatory frame work Adopting investment promotion measures Promoting off-grid renewable solutions REmap Africa workshop June

10 THANK YOU

11 Africa s Energy Demand GDP will grow fold between 2013 and Electricity would increase more than 3 fold Biofuel and waste: significant potential to modernize its use Modern renewables would replace a part of fossil fuels demand Total Final Energy Consumption (TEFC) 23 EJ in 2013 A doubling of TFEC to 45 EJ in 2030

12 Renewable energy use in 2013 Traditional biomass 11.8 EJ Modern RE 1.1 EJ 10% modern renewables, 90% traditional biomass 12

13 Different regional solutions Installed capacity in GW Diversification of electricity supply CSP (Centr.)

14 Solar PV Costs in Africa Africa has a need for power: Solar resources make PV an excellent fit But cost structure is uncertain, higher than many assume Data collection challenging, but encouraging results Some markets relatively competitive Very small SHS cost structures are challenging Regional deep-dives necessary for greater clarity

15 Solar PV Installed Costs in Africa Wide ranges across the continent SHS are like consumer electronics Utility-scale cost structure is in places competitive Cost of financing is critical Lack of market scale and regional co-ordination hurts costs, in some cases

16 Example: Bioenergy potential from agro processing industry Potential by commodity Cameroon Ghana Uganda commodity TJ commodity TJ commodity TJ Oil palm EFB 2,058 Oil palm EFB Sugarcane 4,217 Bagasse 26,303 Timber Cocoa Husk Residues 1,302 1,518 Maize Cob 7,459 Oil Palm Wheat Husk 980 Groundnut Shell 502 Shell 1,166 Cassava Cassava Small Cassava Small Small Scale 8,092 Scale 25,050 Scale 5,220 Total potential (Bottom up) other ,626 other 1,950 other 4,396 33,714 44,901 Total potential (Top down) 40,070 71,020 61,490

17 Strengthening Enabling Policy Framework Steady policies, permitted by national RE targets Incorporate socio-economic benefits into energy planning Countries with RE targets in 2005 Countries with RE targets in 2015 Enabling policy instruments e.g. Auctions; reduced fossil subsidies Market design e.g., grid access, electricity pricing Regional standardization of regulatory framework e.g. land use policy for bioenergy production, quality standards for RE devices, coordination of grid codes for regional RE based power deployment 17

18 Financing Public de-risking instruments: Policy derisking: e.g., streamlining permitting process, capacity building for programme administrators Financial derisking: e.g., bank loans and guarantees Strengthen quality of project proposals Project navigator Sustainable energy market place 18

19 Regional Cooperation: Africa Clean Energy Corridor (ACEC) ACTION PILLARS: Zoning and Resource Assessment Identification of high resource zones for RE development. Country and Regional Planning Consideration of cost-effective RE options for power generation in national and regional plans strengthen interconnections and enabling grid infrastructure. Jan 2014 Ministerial Communique signed to endorse ACEC Action Agenda. 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. 19

20 Enabling Frameworks for Investment RRA: Impact in ACEC countries Swaziland: Grid Code adopted, and RE IPP policy under finalization RE being integrated into national energy policy and legislation Integrated resource planning under development Mozambique: RE resources mapping for the whole country done RE feed-in-tariffs adopted Rural Electrification Strategy with RE focus revised for private sector involvement Measures for promoting small hydro under consideration Zambia: Mapping of RE resources and development of feed-in-tariffs Integrated resource planning under development Djibouti: RRA used as basis for a geothermal intervention of USAID Inclusion of RE in the electricity Master Plan and Electricity Law Tax exemption for all RE equipment

21 National and Regional Planning and Capacity Building - Training workshops held for RE Zoning, generation planning, governance frameworks, rid integration of RE. - Practitioner s Guide for grid integration of variable RE developed. - Ongoing efforts together with other institutions

22 Example Innovation: Electricity storage as enabling technology SYSTEM ANALYSIS FOR STORAGE STORAGE IN ISLANDS AND REMOTE AREAS CONSUMER-LOCATED STORAGE South Africa Rural electrification Solar home systems GENERATOR-LOCATED STORAGE GRID-LOCATED STORAGE Voltage-issues Northern Cape Pumped-storage hydro