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Debt fears aside, China’s tech will close Africa’s energy gap

Saturday December 14 2019
KAGPIC

From 2010 to 2019, Kenya has raised the rate of access to electricity. PHOTO | FILE | NATION MEDIA GROUP

By PETER KAGWANJA

In the 21st century, the trouble with Africa is simply and squarely the failure of its leadership to invest in energy.

The result is a frightfully widening energy gap, responsible for poverty, joblessness and underdevelopment.

Beyond the sinophobic debates on debt trap, Africa must forge a strategic partnership with China to close the energy gap and join the league of energy-rich haves.

For too long, African leaders and their economic advisers have walked on their heads, and must re-read and re-write Adam Smith’s Wealth of Nations if Africa is truly to claim the 21st century.

The per-capita energy use is the truly universal measure of wealth and progress of nations, not the GDP! Africa’s Kilowatt hour per capita is the lowest in the world.

How to close Africa’s energy gap formed the thrust of the conference on “China-Africa energy cooperation under the Belt and Road Initiative” co-hosted by the Africa Policy Institute and the Chinese energy giant, the China National Petroleum Corporation (CNPC) and its think tank, the Economics & Technology Research Institute (CNPC-ETRI) in Nairobi on December 13, 2019.

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Africa needs to cross the global energy divide from energy have-not to energy-have.

ACCESS TO ELECTRICITY

Of about 1.2 billion people without access to modern energy services globally, 50 per cent are in Africa.

The International Energy Agency (IEA) estimates that about 600 million people in sub-Saharan Africa will be without electricity by 2030.

As demand for cooling surpasses the demand for heating by the middle of the 21st century, Africa needs more energy for value-addition and to get its fresh products to the marketplace.

A low energy gap prevents Africa from joining the league of emerging super economies in the global south.

Today, China has managed to give 100 per cent of its 1.4 billion people access to electricity.

Over 97 per cent and 82 per cent of Brazilians and Indians, respectively, are connected to the electric grid.

Only countries in North Africa have managed to give 97 per cent of their people access to electric power. The rest of Africa is largely at between 23 per cent and 47 per cent rate of access.

An exception is Kenya, which has raised the rate of access to electricity from 25 per cent in 2010 to 76 per cent by 2019, and plans to provide 95 per cent of its people access by 2020.

ENERGY CONSUMPTION

The new Garissa Solar Power Plant that President Uhuru Kenyatta launched on December 13, 2019 adds 54 megawatts to the grid.

But at below 3,000 megawatts, Kenya’s ambition to industrialise will remain a pipe dream.

Worse still, Africa continues to be the leading consumer of ‘dirty energy'.

Of all energy sources, Africa largely consumes oil (42 per cent) of total energy consumption compared to gas (28 per cent), coal (22 per cent), hydro (6 per cent), renewable energy, one per cent and nuclear energy (one per cent).

Africa is one of the largest sources of clean energy (hydro, solar, wind, geothermal, tidal, and solid biomass), but these are largely untapped.

Africa has tapped only one per cent of its geothermal and 10 per cent of hydro-electric potential.

After 2000, China is emphatically transforming Africa’s energy market. Its $13 billion infrastructural investment in energy between 2010 and 2015 led to a 30 per cent increase in power generation capacity of Africa, from 95 gigawatts (GW) to 115GW.

FINANCIAL SUPPORT

Its cooperation with Africa on the energy sector rests on two planks. First is the Forum for China-Africa Cooperation (FOCAC), which was formed in 2000.

The 2018 Summit in Beijing dedicated the lion’s share of the $60 billion pledge of Chinese financial support to Africa to energy infrastructure projects.

Second is the Belt and Road Initiative (BRI), China’s global development strategy adopted in 2013, whose investment in energy interconnection will reach $27 trillion by 2050.

Under the BRI, the African Energy Chamber secured over $1.4 billion in intentions to invest in Africa’s bankable projects in mining, oil and gas, power and renewable energy in September 2019.

Within Africa, the Africa Power Vision (APV) of the African Union Agenda 2063 is guiding China-Africa cooperation in the energy frontier.

Also landing Agenda 2063 is the Africa Renewable Energy Initiative (AREI), aimed at achieving at least 10 gigawatts (GW) of new renewable energy generation capacity by 2020 and to realise the continent’s potential to generate at least 300 GW by 2030. Obviously, China is not a newcomer in Africa’s energy market.

RESOURCE-HOLDERS

But global insecurity, and uncertainty in the traditional oil markets in the Middle East, has transformed Africa into the world’s newest energy frontier.

The rise of China as the world’s second largest economy by 2014 has increased its energy use per capita per kilogramme of oil equivalent from 465 by 2000 to 2,237 by 2014.

China’s energy use hit the 3,273.5 million metric tonnes of oil equivalent by 2018, making it the largest consumer of primary energy in the world.

Today, Africa possesses 7.5 per cent and 7.1 per cent of global oil and gas reserves, respectively.

Before 2000, China’s footprint in the energy sector in Africa was in gas and oil, limited to Sudan. But today, Chinese oil companies are operating in nearly 20 African countries.

Despite vexed debates on nuclear energy and technology, the continent is rich in uranium - with Nigeria, South Africa and Namibia ranking among the world’s 10 largest uranium resource-holders in the world.

NUCLEAR

Access to nuclear power is Africa’s best hope to accelerate the closing of its energy gap.

Currently, only South Africa is producing electricity from nuclear sources, contributing 5 per cent to its electric grid.

Facing the future, the newly established Center for China-Africa Studies (CCAS) has to sustain the dialogue, generate and share cutting-edge research knowledge on China-Africa cooperation on energy to close Africa’s energy gap.

Prof Kagwanja is CEO of the Africa Policy Institute (API). This article is part of a speech delivered during the Conference on “China-Africa Energy Cooperation Under the Belt and Road Initiative” convened by API and China National Petroleum Corporation and its research think tank Economics and Technology Research Institute on December 13.

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