Private sector holds key to African renewables – says private-sector entity

RES4Africa’s plan to consolidate all the European sources of funding for African renewables into one portal sounds like a positive step but a 171-page report claiming to explain how to de-risk the private investment needed for the African energy transition is light on other hard policy commitments.

An alliance of largely private-sector renewable energy bodies from Europe says independent power producers (IPPs) – rather then governments or multilateral lenders – hold the key to exporting the EU’s post-Covid green recovery credo to Africa.

The Renewable Energy Solutions for Africa (RES4Africa) group – founded, according to its website, by London-based auditor pwc, Italian grid operator Terna and compatriot bank Intesa Sanpaolo and state-controlled energy company Enel, and German wind turbine maker Siemens Gamesa – has published a report explaining its plans to de-risk investment in clean energy projects in Africa.

In essence, the 171-page document Scaling up Africa’s renewable power pledges to consolidate the myriad funding options offered in Africa by the EU and the development banks of its member states as well as extending efforts to de-risk clean energy investment through the whole life of renewables plants, rather than just at the initial, funding stage.

Solutions

Suggestions such as encouraging contractual requirements to opt for experienced providers of engineering, procurement and construction services and a similar precaution in relation to operations and maintenance firms appear logical, and renewable energy resource mapping and standardization of legal documents and power purchase agreements would be similarly helpful.

The report acknowledges that political risk is also a factor in clean energy investment decisions and there is, depending on your point of view, either a certain naivety or possibly even a sinister tone to the idea RES4Africa can bring about the political buy-in and regulatory reforms needed to drive renewables deployment through “high-level policy dialogue between local [African] and international stakeholders.”

The organization intends to break the investor risk barrier through the renewAfrica initiative it launched in June last year and the report states the first 12 months of operation resulted in “a series of achievements” including “the development of headline communication materials (for example, brochure, logo, website).” Only then, it says, did attention turn to working groups focused on issues such as financial support and technical assistance. Does that sound like an organization capable of winning the cornucopia of African policymakers, with their myriad local concerns, over to the necessity of regulatory and green energy policy reform?

Failure

Criticism of the failure of the various multilateral development programs to drive clean energy deployment fast enough may be borne out by the fact the continent still has a paltry 2 GW of renewable energy generation capacity but claims the private sector is the key enabler are somewhat undermined by case studies highlighting the successes of the World Bank and the European Investment Bank, and of a need for concessionary and semi-concessionary finance to unlock Africa’s renewables potential. As the International Energy Agency’s Fatih Birol points out, governments drive more than 70% of global energy investment.

In a moment in time when language and historical crimes are increasingly coming under the spotlight, RES4Africa’s pitch about why Africa should look to Europe for its renewables policy steer – “The EU has the ability to lead on energy and climate policies and share knowledge on fundamental regulatory issues” – may sound a touch colonial. Has anyone considered an Africa free of the dictates of paying crippling mountains of debt might formulate a better energy transition? Although, former Italian prime minister Romano Prodi probably hits the nail on the head in terms of the EU’s geopolitical desire to set the agenda in Africa when he remarks: “The only African policy at a continental level has been implemented by China.”

Opportunity

There is much talk, not surprisingly from a private-sector alliance, of the renewables business opportunities on offer across the continent. Universal electric access will require $120 billion of annual investment up to 2040; 170 GW of renewables capacity could be installed by 2030; off-grid renewables will offer a further $16.3 billion market over the next 20 years.

The ideas of combining the bewildering array of European funding programs for Africa into one portal, and of trying to encourage a friendlier investment environment in the continent are laudable. However, the pertinent question should perhaps be: How much of those vast sums will end up invested in services which improve the quality of life of the African man or woman on the street?

Green finance

pv magazine is diving deep into the topic of green finance and what it means for solar industry players as part of our UP initiative. Topics include the European Green Deal, regional growth opportunities, green bonds and the role of the carbon bubble. Stay tuned and get involved by emailing up@pv-magazine.com

Lắp đặt điện mặt trời Khải Minh Tech
https://ift.tt/2X7bF6x
0906633505
info.khaiminhtech@gmail.com
80/39 Trần Quang Diệu, Phường 14, Quận 3
Lắp đặt điện mặt trời Khải Minh Tech
https://ift.tt/2ZH4TRU