Definition / Scope
- What is Energy Efficiency? – Energy Efficiency is the methods and procedures applied for restraining or preventing unnecessary usage and wastage of energy. Something is considered to be more energy efficient if it consumes less energy for the same services or the same services are served for lesser energy input. It’s a major concern at present as the conventional sources of energy are depleting and green house gases are increasing globally. The world might turn out to be uninhabitable if the situation is not taken control of. Thus, various policies and regulations are being framed globally. The poorer sections of the world are being aided by international agencies. Let’s take a look at the current energy scenario of Africa, challenges and development opportunities.
- The present challenges faced by Africa in terms of energy sector’s development
- Lack of proper power and energy infrastructure
- Low and difficult access as the areas are very remote; Transmission and Distribution networks are poor
- Limited understanding and awareness of energy efficiency as an energy resource, thus, people don’t understand the crucial necessity of implementing energy efficient methods
- Poor regulatory efforts and policies for energy related investments
- Lack of properly trained professionals related to energy efficiency
- Lack of investors for energy efficiency projects, thus inhibiting any prospective business or commercial venture in the sector
- Incentives and policies for initial funding of business is entirely lacking which is a huge setback in harnessing the renewable energy potential of Africa
- Different regions in the African continent share different generation statistics of power, the average GDP thus varying in a wide range
- Due to frequent blackouts people have to rely on secondary sources and their own generating stations which is again adversely affecting the GDP
Africa, the continent which still lags behind economically largely due to its inability to utilize the immense energy sources available to it, is currently seeking energy efficient methods to secure its present and future.
Business is unable to prosper to its full potential, children have to either finish up their study tasks before dusk sets or struggle with candlelight, and technologies can’t be implemented due to frequent disruptions in power supply. About twenty-five countries in this region and 560 million people in sub-Saharan Africa are still in desperate need of power infrastructure.
Though there has been substantial amount of rise in investments in the sector, yet, it’s always outpaced by the rising population and subsequent demands. It is estimated that between 2010 and 2040, the demand for energy in Africa shall rise by 85%
- Africa is supposed to quadruple its renewable energy capacity from 30.5 gigawatts in 2012 to 120 gigawatts by 2030.
- The major sectors consuming energy in Africa include the commercial and industrial sector. The GDP grew by 4.1% in the fourth quarter of 2014.
- South Africa is one of the most energy efficient and concerned regions in the continent. It has set up energy efficiency and demand side regulations recently. It supplies almost two-third of Africa’s power demand and is one of the cheapest electricity producers globally.
- Almost 90% of the energy generated in the South African region is obtained from coal-fired power stations. Nuclear energy and hydro energy constitutes the rest of 50% each.
- About 36% of the energy demand is again met by synfuels or synthetic fuels which are locally produced and combination of coal and natural gas. Refined crude oil constitute the rest 64%.
- West Africa has been marked the most energy efficient region in the African continent by the latest report of ‘ECOWAS Renewable Energy and Energy Efficiency Status Report’. Some salient findings are mentioned below:
- In early 2014 ECOWAS had 39 megawatt of on-grid renewable electricity connection. Including hydro energy in the proportion, the total installed capacity was 4.5 gigawatts
- Only 28.8% of the on-grid energy comprises of clean energy
- New investments in the renewable energy sector in six leading ECOWAS member states was USD 29.7 million in 2013, which saw a decline from 2011’s investments of USD 370 million
- The leaders in extensive use of renewable sources (primarily modern biomass) are Guinea-Bissau (30.3%), Ghana (22.4%), and Sierra Leone (19%)
- Hydropower has a huge potential in the region accounting for approx 25 gigawatt of total capacity. Guinea (34.2 percent), Togo (28.8 percent), Côte d’Ivoire (28.2 percent), Ghana (57 percent), and Nigeria (16.2 percent) – these are the statistics of the share of hydro energy
- In grid connected Solar Photovoltaics Cabo Verde leads the share with 6.4 megawatt production. Ghana also has a share in the solar energy which is around 1.92 MW
- Majority of the solar production is off-grid with Senegal leading with installed capacity of 21megawatt, followed by Nigeria and Niger of 20 megawatt and 4 megawatt respectively
- By 2014’s end all the countries of western zone of Africa adopted renewable energy support policies
- Feed-in-tariffs and net-metering system also got introduced. Ghana, Nigeria, Gambia and Senegal adopted feed-in tariff whereas Cabo Verde was the first and only country to own the net-metering system.
- Improved cook stoves got a better hold of the continent while reducing air pollution and its related health issues apart from lower consumption of biomass. The statistics of adoption of the improved cook stoves are: 20 percent in the Gambia, 16 percent in Senegal, 10 percent in Sierra Leone, 6 percent in Nigeria, and 2.1 percent in Burkina Faso
- Energy efficient lighting initiatives were brought into motion in Benin, Cabo Verde, The Gambia, Guinea, Mali, Nigeria, Senegal, and Togo
- Development of energy efficient building structures are being planned and relevant policies have been adopted in Benin, Côte d’Ivoire, and Nigeria
|Base Year||2017||Researched through internet|
Top Market Opportunities
- A World Bank project was carried out in Ethiopia, in which five million CFL bulbs were distributed in rural households. An interesting observation was noted: after carrying out only fifty percent of the distribution almost 80 megawatts of electricity had been saved which was equivalent to USD 100 million. Thus, investment of only USD four million saved USD hundred million in energy costs.
- Three actions has been proposed accompanied with general governance reforms for raising the sub-Saharan economy by 30% in 2040:
- The sector shall need an additional investment of about USD 450 billion for reducing power blackouts and electrifying the entire urban areas.
- Trading of electricity across borders should be facilitated. It shall require regional co-operation and integration among cross-border countries.
- Effective management of revenues (esp. oil and gas) with transparent processes.
- Africa is blessed with high solar radiation, thus, off-grid solar plants can be set up and the energy harnessed to its full potential.
- Sub-Saharan Africa has seen rapid economic growth after 1999 witnessing an increase in energy usage by 45%.
- Around 290 million people out 915 million people have [[Building With Brains + Buildings With Brains = Sustainable Future|access]] to electricity in sub-Saharan Africa at present. The rising population is diminishing the slowly rising electrification in the region. Thus, a vast market opportunity still exists.
- Grid based clean energy production is projected to rise four times of present scenario by 2040 with an aim to provide the entire population of 950 million with electrification.
- Nigeria is predicted to remain the largest gas producer and consumer. Mozambique and Tanzania also contributes a share in the gas industry.
- Coal usage is overtaken by oil and other sources like hydro and nuclear rises in the split to almost minimize usage of coal up to two-thirds of present by 2040.
- Energy demand shall increase by 80% due to the increase in efforts of preserving energy sources, promoting clean energy and policies & regulations for energy efficiency
- Many institutions are seen to provide aid the energy efficiency department of Africa at present, to implement better policies and regulations.The topmost institution is World Bank’s IDA (which has financed USD 200 million for building transmission lines), with others following like the French Development Agency, African Development Bank, West African Development Bank, European Investment Bank etc.
- World Bank has financed Africa and its budding industries in energy and energy efficiency technologies in their initial stages, so, that they could improve their economic conditions.
- Further focusing on regulations and policies, South Africa has developed decent set of regulations and policies for energy efficiency. Whereas, other regions still need to concentrate in this area. World Bank has been supporting them all along and it is expected to see progressive amendments.
Market Size and Forecast
- South Africa is one of the most energy intensive regions globally.
- South Africa holds the sixteenth position among the top twenty greenhouse gas emitters globally. Thus, a reduction target of 12% by 2015 had been set.
- Africa is one of such economies which witness a total varied range of development. South Africa is one of the most energy intensive regions whereas sub-Saharan Africa is devoid of having [[Building With Brains + Buildings With Brains = Sustainable Future|access]] to its energy needs. The economic status is poor, though it has shown considerable growth since past. It still needs a lot of attention to compete with other emerging energy markets.