Africa is making slow, steady progress towards energy security, which will only be enhanced through collaboration.
Energy access is undeniably one of the most crucial components of modern-day living. Reliable energy supply ensures that economies are growing. It supports critical industries like mining, manufacturing, agriculture, healthcare and education. It also improves the lives of billions of people.
Across Africa, approximately 600 million people do not have access to reliable power. The continent contributes to the global need for energy. There has been a considerable shift in recent years to address these energy needs.
In our newly released Africa Energy Review 2024: Driving energy access through collaboration report we examine key developments influencing change across Africa’s energy landscape. We assess the progress made towards achieving a just energy transition. The report also explores gas as a crucial bridge to a greener future. And, it also highlights the importance and power of multi-sector collaboration
Africa’s energy snapshot
In 2023, clean generation capacity increased by 7.1%, fossil fuel generation by 0.1% and total generation by 1.8%.
We anticipate that clean power generated in Africa will increase to 25% by 2025. This is driven by growth in solar, wind capacity and hydro-generated power. Africa has seen an overall increase in clean energy generating capacity. However, actual power generated in 2023 increased by less than 1% from the previous year.
Power generated over the last decade has increased by 12.5%. This is four times less than the increased capacity. Ageing fossil fuel plants, particularly coal-fired power stations, contribute to this discrepancy. Declining availability factors and weather-dependent non-dispatchable solar PV and wind replace that supply with lower efficiency factors.
North Africa’s energy landscape is evolving with a strong oil and gas sector. This is accompanied by a growing emphasis on renewable energy sources such as wind, solar, and green hydrogen. Key players like Egypt, Algeria and Morocco use their resource wealth to transition towards renewables. They also maintain their positions as natural gas exporters.
In East Africa, countries like Kenya, Ethiopia and Tanzania are expanding renewable energy and improving rural electrification. Major projects like the Lake Turkana Wind Farm have helped Kenya achieve over 75% electricity access. Kenya aims for 100% renewable generation by 2030.
Meanwhile, Southern Africa has positioned itself as a leader in renewable energy development, especially in solar and wind. South Africa dominates the region’s investments. Namibia focuses on renewable buildout to support green hydrogen production. It capitalises on its abundant solar and wind resources. Its oil and gas finds are likely to make it a new regional energy hub.
Despite significant advancements across these regions, challenges remain in infrastructure and financing, underscoring the need for continued investment and collaboration to meet growing energy demands and a transition to sustainable energy systems. Several factors have caused the global energy landscape to shift dramatically in recent years – with the post-pandemic recovery, geopolitical tensions and climate challenges being among them – and these have made Africa’s energy poverty more poignant. However, we are seeing greater commitments to leveraging renewable energy resources more heavily globally and in Africa.
– Pedro Omontuemhen, Oil and Gas Leader at PwC Africa
Key development across Africa
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South Africa
South Africa has made considerable progress toward liberalising its energy sector, with a major update being the signing of the Electricity Regulation Amendment Act in August 2024. This act introduces sweeping reforms designed to create a competitive electricity market and modernise the sector, aligning with the country’s goals to end load-shedding and secure long-term energy stability.
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Egypt
Progress continues with the construction of the 4.8GW El Dabaa Nuclear Power Plant – the country’s first nuclear plant.
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Uganda
Construction progresses on the 1,443km East African Crude Oil Pipeline (EACOP) transporting crude oil to Tanzania. The entire operation is expected to be completed in 2025, boosting regional energy security and economic growth.
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Senegal/Mauritania
Phase 1 of the Greater Tortue Ahmeyim (GTA) Project, an LNG project, is set to begin operation at the end of 2024, with the project expected to produce 2.5 million tons of gas annually from 15 trillion cubic feet of gas reserves.
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Mozambique
Mphanda Nkuwa Hydropower Project, a US$5 billion initiative generating 1,500 MW of hydroelectric power for clean and affordable electricity, is set to begin construction by the end of 2024.
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Namibia
Significant oil and natural gas discoveries and a government advancement of its US$10 billion Green Hydrogen Initiative are positioning Namibia as a key player in Africa’s energy transition.
Driving factors taking Africa’s energy sector forward
In our report, key stakeholders highlight the need for investment in infrastructure and technology to enhance grid efficiency, energy storage and resilience.
There is a strong push for greater collaboration across borders, public-private partnerships, and regulatory reforms which we know are crucial for attracting investment and fostering innovation. This way, large-scale projects like Morocco’s Noor Solar Complex and fostering energy security through competitive markets are possible.
– Julie Rosa, Energy Utilities and Resources Associate Director at PwC South Africa
While a just energy transition is also the direction in which we should all be moving, for Africa, it must learn to maximise its value from fossil fuels while this transition happens.
The recent gas and oil discoveries in Namibia and Mozambique are poised to boost economic growth by creating jobs, enhancing energy security and attracting foreign investment.
– Roelof van Huyssteen, Energy Law and Strategy Senior Manager at PwC South Africa
At the same time, we need to continue with the momentum we have gained on the renewable energy front, capitalising from the continent’s vast natural resources, which will help reduce our reliance on fossil fuels and promote sustainable growth.
Technological advancements also play a crucial role in advancing Africa’s energy landscape. Examples include AI-driven energy management that enhances energy efficiency, reliability and access, paving the way for a resilient and sustainable energy future.
Andries Rossouw | Leader | Energy Utilities and Resources | PwC Africa | mail me |
Related FAQs: Africa’s energy transition progress
Q: What is the current status of Africa’s energy transition progress as of 2024?
A: As of 2024, Africa is making significant strides in its energy transition, focusing on sustainable solutions that enhance energy access and promote renewable energy sources across the continent.
Q: How are renewable energy initiatives impacting energy access in Africa?
A: Renewable energy initiatives are crucial for improving energy access in Africa, especially in sub-Saharan regions where over 300 million people lack access to electricity. These initiatives focus on off-grid energy solutions and sustainable energy systems to reach underserved populations.
Q: What role does the Africa-EU energy partnership play in renewable energy development?
A: The Africa-EU energy partnership fosters collaboration and investment in renewable energy development, aiming to boost energy infrastructure, promote green energy projects and enhance energy efficiency across African nations.
Q: What are the primary renewable energy sources being developed in Africa?
A: The primary renewable energy sources being developed in Africa include solar, wind and hydroelectric power. These sources are pivotal in creating reliable energy systems and ensuring a sustainable energy future for the continent.
Q: How is the African Development Bank contributing to the energy transition?
A: The African Development Bank is actively investing in renewable energy projects, supporting energy efficiency programs and facilitating partnerships that aim to improve energy access and promote sustainable energy solutions across Africa.
Q: What challenges does Africa face in achieving its energy transition goals by 2030?
A: Africa faces several challenges, including inadequate energy infrastructure, financing gaps for energy projects, and the need for skilled labour to implement renewable energy systems. Addressing these challenges is essential for achieving energy transition goals by 2030.
Q: How can battery energy storage systems enhance energy solutions in Africa?
A: Battery energy storage systems can enhance energy solutions in Africa by providing reliable energy during peak demand times and ensuring a consistent power supply, particularly for off-grid energy applications where energy access is limited.
Q: What is the significance of wind energy in Africa’s energy landscape?
A: Wind energy is significant in Africa’s energy landscape as it offers a clean and sustainable power source that can be harnessed in various regions, particularly in East Africa, where wind potential is high. This contributes to the overall goal of a sustainable energy future.
Q: How does the productive use of energy relate to Africa’s energy transition?
A: The productive use of energy is crucial for Africa’s energy transition as it promotes economic development, enhances livelihoods and supports local industries. By increasing access to reliable energy, communities can leverage energy for productive activities, driving sustainable growth.
