With abundant mineral resources and natural resources, Africa was poised to drive the renewable and green energy market, the Africa Energy Indaba heard this week.
The conference held at the Cape Town International Convention Centre took place against the backdrop of the county’s precarious energy supply, the economic disruptions caused by the global Covid-19 pandemic, rising crude oil prices and the Ukranian-Russian war further threatening to impact the global economy.
In a further blow to South Africa, the joint owners of the largest crude oil refinery Sapref has announced its closure .
Mineral Resources and Energy Minister Gwede Mantashe said the decision added to the uncertainties in energy supply and security of petroleum resources.
He said the Central Energy Fund was considering taking over the running of the refinery.
"If we can succeed in that we will ensure a major victory for the country," Mantashe said. Coupled with the re-prioritisation of state agency, PetroSA, the country would have a bigger supply.
"The reality is that the only countries that currently provide electricity at a lower cost include the oil-producing countries such as Nigeria and Angola. If we produce our own we have a bigger chance of lowering energy prices," said Mantashe.
Mantashe urged the African continent to invest in sustainable solutions as it faced "energy poverty".
He said energy consumption in sub-Saharan Africa, excluding South Africa, was below 30GW, the equivalent of Argentina's consumption.
A member of Parliament in Sierra Leone, Dr Kandeh Yumkella said Africa was faced with an opportunity to be a leading producer of batteries for renewable energy storage.
"Africa sits on 50% of the world's cobalt, significant quantities of lithium, manganese and other minerals required to create batteries. We can drive the green energy revolution. We can be the leading producers of the batteries in Congo, Zambia, and green hydrogen production.
"Southern Africa sits on over 75 % of platinum metals needed for fuel cells for storing the hydrogen power. Africa has the best solar radiation opportunities in the world - we can be the leaders in hydrogen energy," Yumkella said
Former Eskom chief executive Thulani Gcabashe agreed.
"We have an abundance of minerals needed for renewable energy resources particularly for solar and wind energy. The world is looking for these. We have an opportunity to start planning and investing in the new technologies. Capital markets are favourable to developing these systems and it's for us to create that safe environment. The demand is there.
"The capital cost of installing these systems has dropped drastically over the past 10 years. We need to focus on setting out policies that support independent power producers, co-operatives or community based renewable power producers," said Gcabashe.
Mantashe said there was an opportunity for a "massive" expansion of gas trade, especially from the Gulf of Guinea and the broader West Coast of Africa.
Yumkella said the continent needed private sector investment in infrastructure, and a good regulatory framework to support or drive the renewable energy sector.
Mantashe cautioned that the transition from coal should "aid development" and address historical inequalities.
"The so called accelerated transition intent on replacing one system with another in a flash is both irrational and dangerous," Mantashe added.
A total of $8.5 billion was pledged to South Africa at COP26 to help the country transition from coal to renewable energy.
A presidential task team was set up to oversee how the money would be used.
Eskom chief executive Andre Du Ruyter is hoping that the bulk of the money would be allocated to the power utility to help it expand the energy grid and build new generation capacity.
De Ruyter said there was a need to accelerate grid access connection and huge investments into infrastructure.
"To ensure security of supply we need 30GW of new generation capacity, (70% of which will be renewables) by 2030.
"Significant transmission infrastructure upgrades are required in the short and medium term at a cost of R180bn between now and 2031. And that means we have to build about 2 598km of new lines by 2026 (about 73% more than was constructed over the past five years)“, De Ruyter added.
He said among innovative projects on the cards, was the roll-out of mini-grids.
"We cannot build transmission lines in every part of the country but at the same time we cannot deny people who live in outlying areas the benefits electricity. We need to find a balance between own generation, mini grids, and national grids so we can prioritise and roll out in a cost effective manner the right solution for markets," said De Ruyter.
One of the projects involved re-purposing shipping containers with an inverter and battery as an off-grid renewable power plants as part of the Just Energy Transition plan.
"The entire system can be transported on the back of a truck and delivered to any outlying site.
“We are intending to act as an incubator for this technology and have set up an incubator facility at the Komati Power Station and the idea is to transfer to a suitable entrepreneurial firm to drive this," said De Ruyter.
He said while the manufacturing of 152 shipping containers would result in electrification of 46 000 homes, it could also stimulate the local economy, and create job opportunities as well as up-skilling of the public.
He said some of the vacant land that Eskom owned around its power plants in Mpumalanga could also be used to expedite delivery of renewable capacity.
"We believe this will be attractive to developers a this will also demonstrate to those areas that there is future beyond coal and what better way than enabling the construction of renewable energy projects where coal mines are today," said De Ruyter.
Mantashe said his department was finalising policy inputs on the Just Transition Framework for the Energy and Mining Sectors.
The plan proposed mitigating the expected socio-economic impacts on communities and puts emphasis on re-skilling of workers as well as creating alternative economic livelihoods for communities surrounding energy utilities and mines.
A consultation process and public engagement process would be undertaken later this year, Mantashe said.