The Africa Energy Futures report sets out the conclusions and observations of DLA Piper Africa’s member firm lawyers in 21 jurisdictions across the continent in relation to the future of energy in Africa, all within a 2030 horizon. The report’s country chapters address a number of discernible trends.
Africa Energy Futures
Horizon 2030 Report
In 2021, the 26th UN Climate Change Conference of the Parties (COP26), IPCC and UN reports on climate change and emissions gaps have placed a heavy focus on the most pressing issue of our time: how to arrest climate change. That, in turn, has shone an increasingly bright spotlight on the energy and natural resources sector, and how it must adapt if global emissions targets are to be met.
In this context, Africa’s energy transition will play an important role in decarbonizing the global economy and meeting the Paris Agreement targets. While major steps have already been made, many African jurisdictions are still very much fossil fuel reliant. Differences in existing energy supply diversity and power systems between nations also mean that the energy transition has been inconsistent across jurisdictions.
The Africa Energy Futures report is an in-depth look at where 21 jurisdictions across the continent currently stand in regards to this transition, as well as the challenges and opportunities that will arise in the next five to ten years.
Comprised of 21 country chapters, prepared by our DLA Piper Africa lawyers and energy and natural resources teams, the report sets out observations and conclusions per jurisdiction. Each country chapter responds to the same set of questions and themes. Readers can download the entire report in PDF format or simply navigate the country chapters one by one. Additionally, the Executive Summary sets out the general trends we’ve identified.
We hope that you find this report useful and informative. Please do not hesitate to get in touch if it gives rise to any issues that you would like to discuss in regards to any of the jurisdictions here surveyed.
Use the "Issue contents" drop down or the links below to access specific country content.
In this issue
In Algeria, despite the enactment of Law No. 04-09 of August 14, 2004, on the promotion of renewable energies in the framework of sustainable development, no concrete governmental decision to promote renewable energies has been taken since.
The Angolan Government has created investment incentive models to be adopted in the renewable energy sector. Through the Atlas and National Strategy for New Renewable Energies plan, a framework to encourage investment in renewable energy was proposed that focuses on attracting private initiatives to the sector.
Botswana’s power system has been characterized by unreliable power supply, lack of investment, poor maintenance and high service costs. To meet its peak power demand, Botswana imports power from the Southern Africa Power Pool – mainly from South Africa – and when imports are not available, resorts to the use of costly backup diesel power plants.
In Burundi, the liberalization of energy services began in 2015 following a new law on the reorganization of the electricity sector in Burundi. It involves attracting investors to the sector and promoting the emergence of national power sources through the use of public-private partnerships (PPP).
Côte d'Ivoire has launched a set of legislative and regulatory texts aiming at governing the energy sector in recent years. However, these texts need to be updated to better align with the development of the sector.
In Ethiopia, the development of the renewable energy sector will play a fundamental role in realizing the government’s policy of achieving middle-income country status by 2025. In the process of realizing this goal, the sector will create job opportunities, transfer knowledge and add skills to local professionals.
Spurred by the power crises in the last decade, Ghana quickly ramped up production capacity and currently has excess capacity. But the added capacity came at a relatively high cost. The government's response has been to renegotiate some identified power-purchase agreements (PPAs) and encourage renewable sources of energy, notably solar.
While thermal energy continues to play a role in Kenya’s energy mix, more than 70% of installed capacity comes from renewables. Over the last five years, there has been tremendous growth in renewable energy technologies, particularly wind, solar and geothermal.
In today’s challenging context marked by the continued prevalence of COVID-19 that has shaken Mauritius’ economy and in the wake of the surge in prices of petroleum products, it is anticipated that renewable energy will play a pivotal role in the country’s development.
In 2009, the Kingdom of Morocco launched an ambitious energy strategy which essentially seeks to increase the country’s total power and share of renewables in the energy mix. The objective was to reach a 42% share of renewable energy of total power production capacity by 2020.
Mozambique has the goal of becoming an energy hub in southern Africa with the production of hydrogen. Cheap energy used to produce hydrogen would be a real motivator for the construction of the long-awaited Mphanda Nkuwa Dam on the Zambezi River, a project that exists since the colonial era.
Namibia has great potential for renewable energy, especially solar and wind. Under the National Energy Policy of 2017, the government resolves to guide integrated resource planning by prioritizing generation projects from renewable, non-polluting, indigenous, diverse, and decentralized resources, in a way that optimizes the long-term cost of electricity supply.
Nigeria will undoubtedly adopt greener sources of energy in its mix. It is expected to be mainly in the form of solar. Nigeria could generate over 50% of required power by deploying solar PV panels on just 1% of Nigeria's land mass. However, there will also be further development of thermal power plants in view of the abundant gas reserves in-country.
Rwanda is committed to the sustainable development of the energy sector by giving priority to renewable energy alternatives and new technologies. Solar power is expected to contribute a significant share of power generation as technology improves and battery storage prices fall.
Senegal is implementing a gas to power program in the energy sector. Its purpose is to convert existing thermal power plants to dual-fuel and to build future thermal power plants using natural gas as a primary energy source. The exploitation of the GTA field will play an important role in promoting consumption of clean energy and will support the implementation of the gas to power program.
Although South Africa remains very reliant on fossil fuels, there has been an increased supply and use of renewable energy, particularly wind and solar. This is mainly a direct result of the 2019 Integrated Resource Plan (IRP) which sets out the South African government's diversification targets for the energy supply mix by 2030.
Tanzania like other developing countries in Africa is striving to adopt various ways of ensuring that energy supply is accessible as well as affordable. Talking into account the social, environmental, and economic benefits of off-grid renewable energy vis a vis costly grid infrastructure, renewable energy will undoubtedly remain a dependable energy source for Tanzania in the near future.
Tunisia is in the process of launching its first generation renewable energy projects. As part of this process, the state plans to build renewable energy projects with a capacity of 500 MW. Annual investment for these projects is estimated at USD400 million, which will improve Tunisia's energy autonomy, reduce production costs and create jobs.
Due to the need to diversify Uganda’s energy mix and fulfill the country’s climate change commitments, the government’s emphasis will be on renewable forms of energy such as wind, solar and biogas. Nevertheless, it is anticipated that large and mini-hydro will continue to be Uganda’s principal energy supply source in the medium to long-term.
In Zambia, renewable and new technologies will attract foreign direct investment and can be used to develop the economy following the negative effects of poor rainfall in the past few years and COVID-19. There has been recent growth in industrial activity which has increased the demand for energy.
Investment opportunities will arise in two main areas in Zimbabwe in the next decade: renewable energy and petroleum. The government has provided incentives to the energy sector and awarded several IPP licenses to different companies, but very few of these projects have been executed. The delay in implementing these projects has been caused by a lack of funding in light of perceived currency risks.
The African continent as a whole remains heavily dependent upon fossil fuels with the likes of South Africa and Nigeria remaining over 70% dependent on non-renewables. The potential for a green transition over the coming years remains pertinent, yet a long way off.