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Sunday 18 March 2018
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The Time To Invest In Renewable Energy Is Now

The Time To Invest In Renewable Energy Is Now


Africa is a continent full of paradoxes. Individually, African countries compete for the most absurd paradoxes, for instance, while Nigeria is the world’s second-largest producer of tomatoes it is surprisingly the biggest importer of tomato sauce. The DRC produces the highest number of high-value gems but surprisingly it is one of the world’s poorest countries.

These are just two of the many paradoxes in Africa, with each country having its own (if not many). However, apart from individual countries, Africa as a whole has its own paradox.

Africa is second to none when combining fossil fuels and renewable energy. However, despite this, Africa ranks bottom when it comes to evenly distributing the available energy.

In Mauritius, everyone has access to electricity supply while in Guinea, only 10 percent of the entire population has access to electricity supply, roughly, none of Guinea’s rural population has electricity. The same applies to South Sudan, Malawi, Liberia, Chad, and Burundi where only 10 percent or less of the entire population lack access to electricity supply, something that’s prevalent in many other African countries though to different degrees.

As we have seen, the age-old energy problem is not a lack of natural resources per se to generate energy but a combination of insufficient capacity, depressed investment, high production costs, monopolies, and poor reliability. It is through a combination of these that the entire Sub-Saharan region with a population of 800 million generates roughly the same amount of electricity as Spain, a country with a population of 45 million.

It has taken a long time for Africa to find long-lasting solutions for this energy challenge but it’s now looking positive, most African countries have taken steps to eradicate the challenges that were making it difficult to solve the energy problem. Importantly, most governments across Africa are now opening up the environment for new actors, monopolies are being broken, and measures are being put in place to address high production costs.

By breaking monopolies and opening up space for new actors, new ideas, innovations, and ways of doing business are coming to the fore. One such innovation has been the Hybrid Power Solutions, a power generation method premised on utilising a combination of renewable energy, battery storage and to some extent fossil fuels.

With an open investment environment, this is the perfect time for independent power producers, whether established or start-ups to take advantage and make a name for themselves while ‘lighting’ the lives of many Africans.

Established power companies such as JUWI and Tesla are making huge strides in efforts to address the energy problem. JUWI first made its mark in Australia where it successfully completed the off-grid solar hybrid project at DeGrussa mine in 2016. The success of the project propelled JUWI to seek new projects and the company has earmarked Sub-Saharan Africa for its next projects. Tesla has also taken the same path, after successes in Europe; the company is set to expand its influence on the African continent starting this year.

Its good established firms such as Tesla and JUWI are leading the way; however, in a continent also bedevilled by high unemployment and underemployment rates, thus it’s an opportunity for start-ups to blossom. This is more so if one factor in several investment firms and companies willing to partner with start-ups in the energy generation, power engineering, and construction fields.

In addition, to a conducive investment and operating environment, emerging energy companies stand to benefit funds from various organisations such as the African Renewable Energy Fund (AREF), Nordic Development Fund, Norfund, Energise Africa and many others. Most of these organisations’s priority focus is on wind, solar, small hydro, biomass, and geothermal energy.

While some offer financial support without any conditions attached, there are those that also offer conditional financial offers. However, even in case of these emerging businesses stand to benefit also. Most of the conditional financial offers come with the first cover loss, an extra level of protection.

There is nothing like that feeling of knowing that you did something good more so if you do it for children and the disadvantaged.

By investing in renewable energy, you help a child in remote Kenya, South Sudan, Zimbabwe, South Africa, Malawi etc. to read and study as and when s/he is at peak, you help families stay in the light, you bring smiles to families as they interact with others, you help small business owners and stallholders grow their businesses by installing fridges and selling cold drinks or serving warm food, and you help small-scale farmers improve productivity by utilising energy powered farming solutions such as irrigation.