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Wednesday, February 1, 2023

Can Africa develop with out fossil fuels?

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In Hell’s Gate, a two-hour drive north of Nairobi, steam gushes out of the earth’s crust, producing a renewable type of vitality that provides virtually half of Kenya’s present electrical energy wants. The steam is captured in miles of inexperienced pipes, which coil throughout the hillsides like large pythons in direction of energy stations that convert the volcanic vitality into electrical energy.

What began as a unusual experiment 40 years in the past is now a critical trade. Kenya has ample geothermal reserves to multiply its present put in capability by at the very least eight instances, in line with the Energy and Petroleum Regulatory Authority, the nation’s vitality regulator. In principle that may give it the chance to massively ramp up renewable-powered industries from inexperienced manufacturing to inexperienced hydrogen.

Renewable vitality — together with hydro, wind and solar energy, in addition to geothermal — accounts for 75 per cent of Kenya’s electrical energy technology, in line with EPRA. So ample are its reserves that, in the meanwhile, a lot geothermal vitality is vented off at night time when demand for electrical energy is low.

Clearly, not each nation in Africa is equally endowed, though 22 nations on the continent already use renewables as their foremost supply of electrical energy, in line with the Mo Ibrahim Foundation, a governance think-tank. Some, just like the Democratic Republic of Congo, are sitting on huge hydroelectric potential whereas others, together with Namibia, with its lengthy shoreline and deserts, are properly positioned to harness wind and solar energy — and finally hydrogen.

A employee on the Olkaria Geothermal Project, operated by Kenya Electricity Generating Company (Kengen), in Hell’s Gate in May final 12 months © Patrick Meinhardt/Bloomberg

Amid the worldwide drive in direction of internet zero carbon emissions, Kenya raises an pressing query for international locations in Africa and elsewhere within the creating world. Is it potential for a poor nation to attain a excessive dwelling normal with out intensive use of fossil fuels?

Poverty in perpetuity

Many African officers argue that it isn’t. Renewable vitality, together with trendy off-grid photo voltaic used to gentle villages, is solely no substitute for the hydrocarbon vitality depth wanted to make metal, run factories and create jobs for a quickly rising city inhabitants, they are saying. By 2050, Africa’s inhabitants will virtually double to 2.5bn.

“No one in the world has yet been able to industrialise using renewable energy,” Yemi Osinbajo, vice-president of Nigeria, an enormous oil producer, advised an viewers in Abuja, to rapturous applause final month.

With the exception of South Africa and some international locations together with Algeria and Egypt, on common Africans devour a sliver of the vitality and emit a fraction of the carbon of their western counterparts. Nigerians, for instance, produce 0.7 tonnes of carbon per capita, in line with the World Bank, lower than one-twentieth of the quantity wanted to take care of a typical American life-style. Africa is accountable for maybe 3 per cent of world carbon emissions — discounting agriculture and deforestation. Yet it suffers disproportionately from local weather change.

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Many African leaders, consultants and vitality executives argue it’s a gross hypocrisy to insist that Africans freeze their carbon emissions, not to mention reduce them from already low ranges. They say the demand to take action is tantamount to asking a complete continent to remain poor in perpetuity.

“You can measure any country by the amount of gas it has emitted. There is a strong correlation between that and development,” says Mo Ibrahim, whose eponymous basis final week launched a report meant to make Africa’s case within the local weather debate. In November, the COP27 UN Climate Change Conference will probably be held on African soil, in Egypt, giving Africans the possibility to redress what they see as a western-biased agenda superior within the UK-based assembly final 12 months.

Ibrahim, like many others, lambasts western banks and multilateral establishments such because the World Bank which have all however deserted financing gasoline tasks. “It is absolutely immoral and ridiculous for some people to say they are going to cut off funding of gas projects in Africa because they are very nice people who care about the environment — and when they are wallowing in Russian gas,” he says.

As Europe strikes to ban the import of Russian oil, it has been scouring the world for various vitality sources, together with in Africa. Botswana says it has been inundated with requests by European states for coal provides in an obvious volte-face that Carlos Lopes, a professor at Cape Town college, mentioned uncovered the hypocrisy of the European place on fossil fuels.

Mamadou Fall Kane, who advises Senegal’s president on vitality coverage, mentioned Europeans had softened their objection to gasoline, labelling it a transition gas — together with nuclear — of their new taxonomy. Since the battle in Ukraine, he added, any remaining objections to gasoline had crumbled. “After COP26, they wanted to kill it off. Nobody is talking about that any more. On the contrary they are desperately looking for new sources of gas.”

The under-construction Dangote Industries oil refinery and fertiliser plant site in the Ibeju Lekki district, near Lagos, Nigeria
The under-construction Dangote Industries oil refinery and fertiliser plant web site within the Ibeju Lekki district, close to Lagos, Nigeria, in March 2020 © Tom Saater/Bloomberg

If Europe wants fossil fuels, Africa has lots. Mozambique has made prodigious discoveries of gasoline that may be liquefied and placed on ships. Big current oil and gasoline discoveries off the coast of Ivory Coast, Ghana, Senegal and Mauritania have attracted eager European curiosity. Nigeria has the potential to ramp up oil exports, though it has struggled lately to even meet its Opec quota of 1.74mn barrels a day.

Africa has 600mn individuals who lack electrical energy, one-sixth of whom reside in Nigeria. Osinbajo estimates that, given Nigeria’s vitality poverty, its fast-growing inhabitants and its ambitions to industrialise, by 2050 the nation will want 15 instances extra vitality than it at present consumes.

That will probably be unattainable with out gasoline, he says. “You need gas just for the baseload,” he mentioned in his speech in Abuja, referring to the requirement for a secure grid that’s not reliant on intermittent energy. Fortunately for Kenya, its geothermal vitality is secure sufficient to offer a baseload, however wind and photo voltaic usually are not until battery know-how advances considerably.

NJ Ayuk, government chair of the African Energy Chamber, a foyer group, has a easy message of Africa’s intent. “Drill baby drill,” he says. “You’ve got to be kidding if you think we’re going to leave a single drop of our hydrocarbons in the ground.”

‘A just energy transition’

Given the energy of feeling about what many see as Africa’s proper to take advantage of its assets by way of what they name a “just energy transition”, Africans making the case for a renewable-led development mannequin are typically drowned out. But they do exist.

James Mwangi, government director of the Dalberg Group, a consultancy, argues that African international locations ought to go inexperienced not by way of any sense of ethical obligation however as a practical response to new billion-dollar alternatives. “The future is a whole range of business models that have carbon as a commodity stream,” he says. “This is neither charity nor philanthropy. It is delivering a very real service to the world — quality carbon credits.”

Mwangi says that each the wealthy world and middle-income international locations corresponding to China, Vietnam and Brazil are already locked right into a carbon-intensive path that may make switching to greener applied sciences troublesome. Most of Africa, then again, has but to construct its vitality infrastructure so it ought to be simpler to undertake new applied sciences corresponding to electrical automobiles, hydrogen manufacturing and carbon seize.

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“What would it take to make Hell’s Gate a global carbon removal hub?” he asks, of the potential to make use of geothermal vitality to drag carbon from the environment.

Kenya may additionally produce items corresponding to textiles competitively, not as a result of its labour is cheaper however as a result of it may achieve this with a decrease carbon footprint, thus avoiding the taxes that Europe will impose beneath its proposed Carbon Border Adjustment Mechanism.

The perception that the vitality transition presents Africa with a one-time alternative to speed up growth assumes greater carbon costs pushed by regulation and trillions of {dollars} pouring into ESG investments.

“You’ve got companies like Goldman Sachs, Vitol [the Dutch energy trader] and others who are investing on the understanding that carbon is going to be a hot commodity,” says Mwangi. “These are not bunny huggers: they are hardened investment bankers betting on carbon prices of $40 to $50 a tonne.”

Given the urgent wants of many individuals in Africa, at the very least one-third of whom reside in excessive poverty on beneath $1.90 a day, the concept that Africa can develop with out rising carbon emissions dangers showing out of contact. In a current op-ed, Osinbajo took a swipe at these with “a naive belief in leapfrogging, the assumption that, like skipping landlines for mobile phones, Africa can ‘leap’ to new energy technologies”.

Monica Juma, Kenya’s energy minister: ‘We are asking ourselves whether there is an alternative’
Monica Juma, Kenya’s vitality minister: ‘We are asking ourselves whether there is an alternative’

Yet for many who advocate exactly that path, Kenya — a rustic with a report of technological innovation going again to its early adoption of cellular cash — gives a glimpse of what is likely to be potential. Dozens of firms in Nairobi, many nonetheless at a proof-of-concept stage, are looking for to create inexperienced options that, they are saying, could possibly be rolled out at scale throughout the continent.

“I don’t know whether you can industrialise without carbon; history has shown us a carbon path,” says Monica Juma, Kenya’s vitality minister. “We are asking ourselves whether there is an alternative. We have done it in digital. Is there a similar leapfrogging in energy? We don’t know, but I suspect there is.”

Countries like Kenya, with the capability to observe a renewable path, ought to take it, she says, as long as others meet their obligations too. “If the journey of emissions is a journey to destruction, then the question we should ask is how do we avoid that destruction.”

The drawback of scale

One huge space of funding is electrical automobiles. Roam, an organization based by Swedish engineers in Nairobi, thinks the place to begin ought to be motorbikes, which may be shortly and simply recharged, and buses, as a result of recharging stations may be positioned alongside a set route.

Roam, amongst others, has began manufacturing small portions of electrical motorbikes in Nairobi for native bike taxi fleets. Its pitch to drivers is just not that they’re saving the surroundings however that the bikes are cheaper to take care of and run, says Albin Wilson, Roam’s chief advertising officer.

Sophisticated elements, together with the engine and tyres, are at present imported from China and India, however different elements, together with sections of the physique and the saddle, are made domestically, he says. In time, Roam hopes to supply extra in Kenya to drive down the value and to assist construct an industrial ecosystem round electrical automobiles.

The eventual aspiration is that batteries — the uncooked supplies for which, together with cobalt, nickel and tantalum, are sourced in Africa — could possibly be produced, or at the very least assembled, domestically too.

A customer in Nairobi tops up on clean fuel at a ‘KOKO Point’ fuel ATM
A buyer in Nairobi tops up on clear gas at a ‘KOKO Point’ gas ATM. Dozens of firms in Nairobi are looking for to create inexperienced options

Another promising thought is being developed by Koko Networks, an organization that goals to switch cooking charcoal with bioethanol, a byproduct of sugar or starch that burns cleanly and is 40 per cent cheaper, in line with the corporate. Residents of Nairobi’s big casual settlements spend $15 a month on common on charcoal, a part of a $30bn African trade that’s the among the many greatest causes of deforestation — along with conversion to agriculture — in addition to being a significant killer by way of smoke inhalation.

Koko distributes ethanol through native “fuel ATMs” in small portions and sells clean-cook stoves, manufactured in India, at price or under. What seems like a small thought from a well-meaning NGO has the makings of an enormous enterprise with the potential to alter cooking habits and arrest deforestation throughout the continent, says Greg Murray, a former funding banker who cofounded the corporate. The Congo Basin Rainforest in central Africa is second in dimension solely to the Amazon.

Koko has signed up one-fifth of Nairobi’s households in about two years and is including 1,500 new prospects a day. Its revenue comes primarily from promoting carbon credit — derived from audited calculations of prevented emissions — which it sells at a mean $20 a tonne to South Korea. So-called compliance markets, together with the EU’s Emissions Trading System, have been value $850bn final 12 months, in line with Refinitiv, a monetary information supplier.

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McKinsey, which produced a report on the potential for a low-carbon industrial future in Africa, recognized greater than 20 inexperienced enterprise alternatives, a number of of which it estimates may make an influence at scale this decade.

One advice is manufacturing wind-turbine towers. Standing on a ladder inside one of many aeroplane-sized towers at Kipeto, a 100MW wind farm south of Nairobi, Norbert Ombese, a area service engineer with GE, mentioned: “Everybody’s going green out there and we are trying to move with the times.” The towers at Kipeto have been made in China however native producers assume they might produce them domestically.

A much bigger alternative nonetheless is hydrogen, argues Seyni Nafo, former chair of the African Group of Negotiators within the UN local weather change course of and now a board member of the African Hydrogen Partnership.

“We have the potential to industrialise the continent by producing reliable, affordable, sustainable, scalable green energy,” he says of the prospect of turning wind, photo voltaic, hydro and geothermal energy into hydrogen. This could possibly be shipped in liquid type to western markets or used domestically to provide inexperienced fertiliser or inexperienced aluminium and metal.

A hydroelectric dam on the Congo River
The Democratic Republic of Congo is amongst these sitting on big hydroelectric potential, whereas others, together with Namibia, are properly positioned to harness wind and solar energy and finally hydrogen © Marc Jourdier/AFP/Getty Images

Foreign buyers have sensed a possibility. Australian mining magnate Andrew Forrest, chair of Fortescue Metals, struck a tentative cope with DRC’s authorities final 12 months to steer an $80bn growth of the Inga dam. The dam complicated on the Congo river may probably be twice the dimensions of twenty-two.5GW Three Gorges dam in China, producing sufficient vitality to energy a lot of southern Africa with lots left over to transform into hydrogen.

“We’ve been talking about it for five decades,” says Ibrahim of grandiose plans for the Inga dam. “It is time to make it real.”

But such massively bold plans take time, says James Mwangi (no relation to Dalberg’s Mwangi), chief government of Equity Group Holdings, a Nairobi-based regional financial institution. Talk of carbon seize and hydrogen manufacturing have to be tempered by the truth of what individuals want now, he says. “The technology for a [green industrial revolution] has not been fully invented yet. So you can’t tell Africa to wait until it is done.”

African international locations will transition at completely different speeds, he says. “Kenya has chosen not to go down that legacy path,” he says of the mannequin of fossil-fuel dependency. “You don’t have to dirty the environment and then start cleaning. But look at countries like Nigeria that have legacy systems. They are stuck where they are and it will be a gradual process to change.”

The one factor he’s sure of is that wealthy international locations can’t suggest options that maintain some international locations poor. The results of such unjust propositions, he says, could be each predictable and devastating: thousands and thousands of individuals crossing the Mediterranean heading for Europe looking for a carbon-heavy life-style.

Source: www.ft.com

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