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A joint analysis by the International Renewable Energy Agency (IRENA) and the multinational financial institution, African Development Bank (AfDB) shows an energy system centered on clean energy would boost Africa’s economy, creating millions of jobs. The recently published report, “Renewable Energy Market Analysis: Africa and its Regions”, put forward energy transition will facilitate increased investment in the African energy sector.
The report lays out a pathway to a renewables-based energy system and shows that the clean energy transition promises substantial growth in GDP, employment, and human welfare in all regions of the continent. Increased investment in the renewable energy sector has the ability to create at least 26 million jobs by 2050.
Integrated policy framework set up around energy transition will give rise to new sustainable energy investment in Africa, growing its total economy by 6.4% by 2050. Many African countries have already engaged in their energy transition by launching several programs to encourage private investment in green energy.
According to the analysis, fossil fuels account for more than 70% of total electricity produced in Africa, with natural gas sharing 42.6%, followed by coal at 28.1%. This trend is driven by countries like South Africa, Egypt, Algeria, etc., which own most of the thermal power plants of the continent. IRENA reports 21.1% of electricity in the region is generated through renewable energy.
Only 2% of the total investment of $2.8 trillion allocated to the renewable sector between 2000 and 2020 worldwide, went to Africa. The Southern African region received the most investment of $22.4 billion, led by South Africa, followed by Northern Africa with $17.5 billion. The Central African region had only $1.3 billion investment mobilized in the last 20 years.
Increasing investment in renewable energy in Africa would not only reduce the proportion of people living without electricity, but also provide them with a reliable, affordable, and clean energy solution. According to the report, this situation concerns more than 50% of the people in the region.
Africa is still lagging behind in the development of the renewable industry, despite its great potential in renewable energy. Although new renewable energy projects have come on stream in the last few years, fossil fuels still dominate the region’s electricity mix.