How Africa became a hotspot for renewable energy

Installed renewable energy capacity in Africa, which reached 12.6 gigawatts (GW) in 2019, is set for consecutive years of growth, according to an analysis by Rystad Energy. The continent’s capacity is expected to reach 16.8 GW in 2020, add an additional 5.5 GW in 2021 and climb further to 51.2 GW in 2025, led by the growth of solar and wind projects in Egypt, Algeria, Tunisia, Morocco and Ethiopia.

Currently, South Africa is leading the continent in terms of installed renewable energy capacity with 3.5 GW wind, 2.4 GW solar utility and a solar dominant 1 GW pipeline of projects under development. Egypt and Morocco are in second and third place in terms of solar capacity with 1.6 GW and 0.8 GW respectively.

Nearly 40 of the 50 African countries have installed or are planning wind or solar energy projects. And while the learning curve may be steep for new entrants to the market with significant development pipelines, inexperienced players will be able to leverage the lessons learned in Egypt, South Africa and Morocco and implement this knowledge into development plans.

Algeria will see the most renewable growth in Africa by 2025, with capacity from just 500 megawatts (MW) in 2020 to nearly 2.9 GW in 2025. The increase will mainly come from one mega project, the 4 GW Tafouk 1 Mega Solar Project , which will be developed in five phases of 800 MW capacity each, to be tendered between 2020 and 2024. Rystad Energy expects three of the tendered projects with a capacity of 2.4 GW to be commissioned by 2025.

Tunisia will also experience formidable growth, from 350 MW of renewable capacity in 2020 to 4.5 GW in 2025. The additions will come from larger solar power plants such as the 2 GW TuNur Mega Project, which is currently in the early stages of development. is located and is expected to come online in 2025.

In terms of speed, Egypt has been one of the fastest African countries to have installed solar and wind since 2017 and currently has about 3 GW of installed power. The country has a massive 9.2 GW development pipeline – largely made up of wind projects – putting Egypt on track to overtake South Africa by 2025 and become Africa’s green powerhouse.

The growth will come from major projects such as the 2 GW Gulf of Suez Red Sea Wind Project, which will be located in the Red Sea Governorate. 500 MW of the capacity to be installed will be developed by the German giant Siemens Gamesa and another 1,500 MW has to be allocated. Four of the top 10 projects to be developed in Africa over the next five years will take place in Egypt, underscoring the Egyptian government’s commitment to its renewable goals.

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Morocco follows Egypt in terms of the rapid pace of installations with 2.5 GW installed capacity, dominated by 1.7 GW wind power. Rystad Energy expects solar power will drive growth there, with a handful of major projects already in the works, such as the 1 GW Noor Midelt Hybrid (CSP + Solar PV), the 400 MW Noor PV II and the 120 MW Noor Tafilalet.

Ethiopia’s capacity will also take a huge leap: the province currently has only 11 MW of installed solar capacity and nearly 450 MW of installed wind, but is expected to have 3 GW of renewable capacity online by 2025. The Tigray Hybrid Project will drive this increase and is expected to contribute at least 500 MW of solar capacity by 2025, assuming a resolution to the current ongoing conflict by then

The cost of renewables is now low, and as larger markets such as China, India and Europe are on track to meet installation targets, wind and solar components will become increasingly cheaper and more easily accessible, creating a favorable environment for investment as well in Africa.

“Historically, development on the continent has been slow due to political instability, lagging policy and infrastructure and poor purchasing. However, as the demand for electricity grows, many African countries are turning to renewable solutions to meet energy targets, with the solar power set to overtake the wind in the next five years as the renewable technology of choice, ”said Gaurav Metkar, analyst at Rystad Energy.

By Rystad Energy

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