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Africans Call On Global Community To Honor Commitment To A “just and inclusive” Energy Transition

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When nearly 200 government and business leaders from around the globe signed the Paris Agreement in December 2015, they did more than commit to cutting greenhouse gas emissions to combat climate change.

They also called upon developed countries to help with the considerable funding, technology transfers, and capacity-building undeveloped countries need to successfully transition away from carbon-emitting fossil fuels toward renewable energy sources.

Equally important, the treaty they signed calls for a “just and inclusive” energy transition, meaning that the road to renewable energy sources is not to be littered with the economic well-being, energy security, and stability of the world’s developing nations. It means decisions to curb CO2 emissions are not to be made in broad, sweeping strokes, but with an eye to potential impacts on individuals and communities. And it means that those who stand to be impacted by efforts to cut greenhouse gas emissions will have a voice in how those measures are carried out.

Recognizing the need for this a just energy transition represents global cooperation at its best.

Unfortunately, what we’ve observed in practice hasn’t exactly lived up to those ideals. What we’re seeing instead is more of an “ends justify the means when it comes to preventing climate change”  mindset. Climate change anxiety seems to be overshadowing reason, respect, and compassion.

The global community’s approach to Africa’s energy industry, in particular, sometimes resembles a panicked crowd stampeding out of a movie theater after a fire alarm is pulled, oblivious to those who are trampled in the process.

During the last couple of years, the global community has increased pressure on African countries to speed up their energy transition. They have pushed financial institutions to divest from oil and gas and coal.  Investments in African oil and gas projects have dramatically decreased, and even worse, countries, organizations, and financial institutions have started pressuring those still considering African investments to reconsider.

Meanwhile, the funding commitments developed countries made to developing countries, billions of dollars in climate finance, have not been met.

That’s not what a just energy transition looks like.

If the world truly wants to honor the goals of the Paris Agreement, then we can’t pick and choose the parts we comply with.

That’s why we are calling for a commitment to the Paris Agreement’s call for a “just and inclusive” energy transition. One that considers each country’s needs, priorities, and unique challenges. One that allows African nations to set the timing of their energy transitions so they can fully capitalize on their energy transition’s potential benefits while minimizing negative percussions.

We address this topic in depth in the 2022 Africa Energy Outlook, (“The State of African Energy 2022”) which we’re releasing this month. The report, explores the opportunities that renewable energies represent for African nations — as well as significant challenges associated with prematurely abandoning fossil fuels, from impacts on government revenue to missed opportunities to address the continents’ widespread energy poverty.

The Promise—And Limitations—Of Renewables in Africa

Too often, during conversations about Africa’s energy landscape, people assume that I — and the African Energy Chamber (AEC) —are so caught up in protecting the continent’s oil and gas industries that we’ve lost sight of the importance and value of adding renewables, including solar, wind, and hydrogen, to Africa’s energy mix. That’s simply not true. In fact, the AEC 2022 outlook explores the benefits that renewable energy represents for Africa in great detail.

Our report calls for a broader African energy mix to accommodate rising energy demand in Africa, and it notes that increasing the usage and production of renewables stands to result in job creation, economic growth, social and health benefits, along with climate change mitigation. The International Renewable Energy Agency (IRENA) says that renewables will create 45 million jobs around the world by 2050 and lead to a 2.4% rise in the global GDP.

That is truly exciting news. However, those global benefits won’t necessarily be equally distributed, at least not yet. When we talk about growing Africa’s renewables industry, we must consider the capacity deficits that exist here. In 2018, for example, World Bank reported that while solar power was a promising means of addressing energy poverty in Africa and Asia, both continents lacked “job-ready talent to finance, develop, install, operate and manage solar power systems and other off-grid energy solutions.”

Until we address the need to build local capacity, African individuals and entrepreneurs are not going to be able to fully capitalize on the job and business opportunities new and expanded renewable energy operations represent. Foreign companies will take the lead. Workers will be brought in from Western countries. Africans may get entry-level positions — which I don’t oppose at all — but many will be passed over when it comes to better-paying positions with more responsibility.

That’s why the AEC advocates for technology and skills-sharing among Western investors and Africans. It’s why we’re pushing for the creation of local content regulations geared for renewable energy sectors and financing initiatives that will help local entrepreneurs compete effectively with their western counterparts. Most of the renewable energy players in Africa are not African. Africans are given little or no access to financing. The level of African participation in this green economy is very low and it creates more doubts about the industry opening up to many young people who seriously want to be players. It’s reasonable to demand a level playing field for Africans — and the time necessary to create it.

Of course, time is only part of the equation. To be frank, African nations also will need money. They need to put skin in the game. Its wrong to just wait for Europe and America to give you aid to build your economy or even finance energy growth. That foreign aid model has not worked in the past and will not work in the future.

An Honest Conversation About Money

Establishing widespread renewables usage and production is expensive. This is not unique to Africa: Countries around the globe are investing serious money into their own energy transitions. In 2020 alone, global spending on the energy transition totaled $501.3 billion, according to BloombergNEF’s (BNEF’s) Energy Transition Investment Trends report.

“A geographical split of BNEF’s energy transition investment data shows that Europe accounted for the biggest slice of global investment, at $166.2 billion (up 67%), with China at $134.8 billion (down 12%) and the U.S. at $85.3 billion (down 11%),” sustainability writer Felicia Jackson reported for Forbes earlier this year.

As the AEC Outlook says, renewables can foster economic growth (under the right circumstances) but that growth comes at a cost.

“Equal growth needs to be observed in annual investments, as the African energy system must see double the investment by 2030 to $40 – $65 billion,” the report states.

The falling cost of green energy technologies will help, the report continues, and we have seen commitments to invest in African renewables. For example, the African Development Bank (AfDB), the Korean Ministry of Economy and Finance, and the Export-Import Bank of Korea are providing $600 million for renewable energy solutions.

The report goes on to cite efforts by the International Finance Corporation (IFC) and The Rockefeller Foundation (RF), which have partnered to mobilize $2 billion of private sector investment in distributed renewable energy solutions, including scaling a mini-grid program and battery energy storage. There are other examples as well.

But, honestly, when you look at the level of investments being made elsewhere, the activities in Africa can only be described as a good starting point. We will need more.

Unique Countries, Unique Needs

The energy transition that works for Great Britain, or Norway, or Japan is not going to work for African countries. Our continent, and each of our countries, have unique needs and challenges. Our report has not hesitated to address them, even situations that reflect poorly on African countries and their governments, from a lack of regulatory and legal frameworks, which can make investments in renewables more expensive, to problems with existing electricity grids.

“It’s important to note that each country has different socio-economic starting points and political ambitions, which will take them down different paths in the energy transition. The transitional pace is dictated by each country’s current dependence on fossil fuels, existing industrial productivity, future technology choices and depth/diversity of domestic supply chains,” the report states.

And while it may sound counterintuitive to the Western world, the strategic use of oil and gas can help African nations address these challenges. Gas can be monetized and used to create infrastructure that supports economic diversification. It also can be used to minimize energy poverty, which has made economic growth next to impossible for many African countries.

What’s more, the very presence of international oil companies (IOCs) in Africa allows for much-needed technology transfers, which will help pave the way for a successful energy transition.

Different Worlds, Different Opportunities

We find it frustrating to see the global community dismiss business activities with great potential to benefit African people, communities, and businesses simply because they involve fossil fuels. It’s difficult to be moved by platitudes written by people in a completely different reality, in a world where energy security is a given and acts of terrorism triggered by lack of jobs or economic uncertainty are unthinkable.

Don’t be so quick to snub — or get in the way of — opportunities that could mean the world to Africans. A small handful of examples included in the AEC outlook report are:

  • The Bonga Southwest – Aparo floating production storage and offloading (FPSO) development offshore Nigeria and the Pecan FPSO offshore Ghana have been picking up steam in recent months.
  • The TotalEnergies operated Cameia – Golfinho offshore Angola is undergoing pre-FEED (Front-End Engineering Design) work.
  • The Tilenga and Kingfisher South projects, both located in Uganda, are now approved and will bring online close to 1.2 billion barrels of oil within the next five years.

Operators in the region have also focused on fast-tracking recent discoveries like Cuica and Eban in the deep waters of Angola and Ghana respectively, because of their proximity to existing infrastructure.

Each of these projects represents opportunities for significant job creation, new work for local entrepreneurs, economic growth and development, monetization, infrastructure development, technology transfers, capacity building, and monetization for African countries and communities. They matter.

Include Africa in the Conversation

The African Energy Chamber advocates for a just energy transition for African countries, one that supports international goals for emissions reduction and climate production without putting African needs and priorities on the chopping block.

We look forward to working alongside the international community to achieve that objective. We simply are asking for conversations instead of lectures, partnerships and investments instead of interference and obstacles.

We realize the international community has valuable guidance, knowledge, and technological advances African nations can benefit from. We simply would like the rest of the world to acknowledge that African voices have much to contribute, as well.

Maybe then, we can build a future that’s good for all of us — and pave the way for a truly just and inclusive energy transition.

NJ Ayuk is the Executive Chairman of the African Energy Chamber (www.EnergyChamber.org)

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Opinions

When Will Covid-19 Pandemic End?

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In his address at the COP26 meeting on climate change in Glasgow, President Obama expressed his feeling of ‘a certain bleakness about the future.’

Although he was referring to climate change and the environment, one could say the same about the current Covid situation locally – there is a prevailing sense of foreboding about the future with the seemingly uncontrollable rising number of infected cases and the mounting daily deaths.

Families are grieving the loss of loved ones, in some of them more than one having fallen victim to the virus.

Hospitals are overburdened with cases that keep arriving, and hospital staff have not only been infected but equally are suffering from exhaustion and burnout, both physically and mentally.

With the Delta variant having entered the country, the medical profession had anticipated that local circumstances would favour the spread of the virus and that we should expect a surge.

Thus, in an interview to this paper earlier, Specialist Physician Dr P. Chitson had already seen this coming, when he said that, ‘The surge in the UK came with the opening of schools and I suspect that’s what happened in Mauritius, plus the declining immunity due to passage of time, and the Delta virus.

The three public holidays in one week will make matters worse soon. Some form of public restrictions must be put back.’ (italics added)

In fact, a new set of restrictions were framed, which many felt were perhaps too little too late, and in the meantime the epidemic continues its deadly march. And the question that is gnawing at everybody is ‘When will the Covid pandemic end?’

In an article titled ‘Post-Corona: Back to basics and…’ in March 2020, I had written, Like other pandemics that came before it, the current Covid-19 episode will also come to pass.

Not even the best experts can say at the moment, but based on the past experience of the evolution of disease patterns over time, the most reasonable estimate is that it will be a few months at least.’

Alas, this overblown optimism was misplaced: it was too early days to entertain such a hope, in light of what soon started to emerge, namely that we were being attacked by an ‘unknown unknown’ as far as the epidemiology of the SARS-COV-2 was concerned.

Much more time was required before the timing of any outcome about the future course could be reliably made, except in generalities, to wit that ‘In course of time, viruses circulate among the population as a normal phenomenon, and produce disease when the conditions are conducive – like the influenza virus which attacks during the cold weather, and then we talk about the ‘flu season… This may happen with Covid-19 too, and by then a majority of people would have developed a degree of immunity to it.

If a large enough segment of the population, about 75-80%, acquires such immunity, then the rest of the population is also protected, a phenomenon known as herd immunity.’

That’s when the virus transitions from epidemic to endemic, and short of being eliminated altogether, this was the best hoped for scenario as regards Covid-19.

Has any country reached that stage? Yes, India is the first to have done so, as Dr T Jacob John, former Professor of Clinical Virology, CMC, Vellore and Dr MS Seshadri Medical Director, Thirumalai Mission Hospital write in The Indian Express of 15 November: ‘Currently, India is the only country in the world to have reached a sustained endemic state while in other nations, the pandemic is still raging. This is a historic opportunity for us to show the world how to tackle endemic Covid-19.’

They started with the pertinent question: Are we out of the woods yet? Then went on, ‘After the first wave abated, we entered a 10-week endemic phase, only to be interrupted by the second wave.

The Delta variant of the second wave had far higher transmission efficiency than the first wave variant (Wuhan-G614D). The recent AY.4.2 variant remains below 0.1%, showing low transmission efficiency that cannot overtake Delta transmission. India has thus become the world’s first country to reach endemic prevalence.’

As they explain, ‘Epidemic means daily numbers of Covid cases rise to a crescendo and decline until a steady state with low numbers (endemic prevalence) is reached.’

With the surge that is raging – and likely to last until at least mid-December- and our capacities being stretched, it is clear that we are very far from such a steady state.

To arrive there, we must be prepared to learn from those who have more experience than us by virtue of resources available, capacities and sheer scale, all of which are exemplified by India.

The authors of that article posed two questions: What determined the transition? What changes in strategy should India adopt to mitigate the ill-effects of endemic Covid?

They then proceed to give a fairly technical account in answer to these questions, in an outline of the measures which have allowed India to attain the remarkable control it has achieved over the pandemic. People are now moving about freely, except in a few areas in only a few states.

There is much for us to learn from the Indian experience. India can ‘show the world how to tackle endemic Covid-19.’ What are we waiting for?

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Fighting Climate Change And Halting Loss Of Biodiversity Key As We Build Back Better And Greener For The Next Generation

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Fighting climate change and halting loss of biodiversity key as we build back better and greener for the next generation

Covid-19 and climate change are two unprecedented challenges for all of us.

While we now rightly focus on containing the virus, addressing the immediate health crisis and limiting the economic damages, we also need to start tracking our way out of the crisis towards recovery.

We need to ensure that the recovery is based on the vast opportunities that green transition offers.

Africa is home to a remarkable animal, plant, and marine biodiversity.

The continent is rich in tropical forests, wetlands, deserts, savannah and montane grasslands, providing critical ecosystem services and serving as buffers to climate change.

For example, mangrove swamps protect coastal societies in Eastern Africa from cyclones and tsunamis, while serving as homes for various species and a source of income for the local people. 

However, the region is experiencing a dramatic loss of biodiversity. Agricultural and other human expansion on land and in the sea, overexploitation of wildlife and spread of invasive alien species are some of the drivers for biodiversity loss, and so is climate change and pollution.

Scientists have warned that by 2100, climate change alone could cause the loss of over half of mammal and bird species and trigger a 10-30% decline in lake productivity. 

The effects are already becoming apparent, and if we fail to address these interlinked crises, we will see more hunger, new pandemics, greater injustice and marginalization, more conflicts and forced migration.

Conservation and sustainable use of biodiversity is a cornerstone for development – loss of diversity poses risks to existing development gains and to further progress.

And we know that climate change and loss of biodiversity is particularly affecting people living in rural areas who are often the poorest. 

How do we address the ongoing disastrous loss of biodiversity while building better and more fair societies in the wake of the pandemic?

We know that urgent action is required at global, continental, regional and local level, and we must work together.

In order to deal with these challenges, the African Union recently launched a new continental Green Recovery Action Plan for the period 2021-2027, that includes a pillar for biodiversity.

Sweden is honoured to co-champion this important initiative. Through collaboration with African countries and partners we will bring this plan to life on the ground and showcase positive examples. 

Nature-based solutions will be identified and implemented. Focus will be on biodiversity through work on sustainable land management, including forestry, and marine ecosystems. 

We can and must all ensure we put climate action and protection of biodiversity at the heart of national budgets and planning processes.

This in turn will facilitate resource mobilisation for implementing the 2030 Agenda, Agenda 2063 as well as the Paris Agreement and the protection of biodiversity.

Let’s use the urgency of climate action and biodiversity protection as a driver also for broader development gains.

There is no contradiction between curbing fossil fuel emissions and achieving economic growth. Instead, we know that shifting to green, eco-friendly energy solutions creates employment and contributes to development, through increased trade and investments. 

The African Union Commission is committed to working with its member States, Regional Economic Communities, partners and relevant stakeholders to drive Africa’s economic recovery from Covid-19 in a sustainable manner.

The Commission aims to do this through the implementation of the Green Recovery Action Plan’s five pillars – Climate Finance, Renewable Energy, Nature Based Solution and Biodiversity; Resilient Agriculture and Green Resilient Cities to drive Africa’s economic recovery from Covid-19 in a sustainable manner.

Sweden will do its part as one of the largest financial contributors to climate change and biodiversity related development aid.

Ensuring climate change resilience is a key focus in our bilateral and regional development programmes across Africa. 

2021 is the African Union’s year of arts, culture and heritage. When talking about culture and heritage, it includes not only the social behaviour and norms of a society, but also the society we want to hand over to the next generation.

Loss of biodiversity and climate change are both driven by human economic activities and mutually reinforce each other. 

Neither will be successfully resolved unless both are tackled. And just as humans are responsible for this multiple crisis, we also have the power to decide on sustainable solutions to change this path.

For this reason, a successful outcome of the UN climate conference COP26 in Glasgow is crucial. Equally important is to come together and adopt a biodiversity agreement, to save life on earth.

This will be in focus at the second part of the UN biodiversity conference COP 15 scheduled to take place in Kunming, China in 2022. 

It is in our common interest to advance an agenda that ensures a green transition and fosters a sustainable development.

This is the time to not only talk the talk but also walk the walk.  The African Union and Sweden are committed to deliver on our commitments, and we urge others to step up efforts as we build back better and greener for the next generation. 

Authors

 

Per Olsson Fridh                      Josefa Sacko                                                            Per Bolund
Minister for International         African Union                                        Minister for  Environment  and Climate,

Development Cooperation,      Commissioner for  Agriculture             Deputy Prime Minister, Sweden

Sweden                                  , Rural Development, Blue Economy

and Blue Economy and  Sustainable Environment

 

 

 

 

 

 

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Exploration, Investment Opportunities In Mauritania’s Petroleum Industry

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Following the discovery (https://bit.ly/3luKJbk) of a large deposit of natural gas offshore Mauritania in the Tortue natural gas field in 2014 by U.S. deepwater exploration and production company Kosmos Energy, interest in the region’s oil and gas prospects has exploded, placing the Saharan country in the early stages of a hydrocarbon boom. Kosmos’ discovery led to the development of the Grand Tortue Ahmeyim project, which is now majority owned by oil and gas giant, BP (60%).

Comprising the maritime border between Mauritania and Senegal and at a depth of 2,850m, BP is currently (https://bit.ly/3FCS1C8) building a floating liquefied natural gas facility to tap into the field’s estimated 15 trillion cubic feet of gas, with a 30-year production potential expected to begin in 2022.

Since the discovery, four supermajor industry firms have initiated exploration activities off the coast of Mauritania, with 19 offshore blocks currently open for tenders.

The Government of Mauritania is now engaged in the early stages (https://bit.ly/3v0u42A) of transforming the port city of Nouadhibou into a hub for the region, with plans to rehabilitate the city’s oil storage capacity of 300,000 tons and to expand the capital, Nouakchott’s, capacity by 150,000 tons.

In recent years (https://bit.ly/3mZtXB1), the Government of Mauritania has been active in encouraging development in its onshore oil and gas sector – with 15,000km of 2D seismic data for the Taoudenni Basin indicating reserve potential – and its petrochemical industry – with plans to construct an oil refinery in the country.

The largest oil and gas player in Mauritania is BP, following a 2016 agreement (https://on.bp.com/3DwrDYA) to acquire working interest and operatorship of Kosmos’ exploration blocks, which contain significant deepwater gas discoveries and exploration prospects.

With a 62% working interest in offshore Blocks C-6, C-8, C-12, and C-13 alongside Kosmos (28%) and the Société Mauritanienne Des Hydrocarbures et de Patrimoine Minier (SMHPM) (10%), BP is committed to its partnership with Mauritania to assist in the sustainable development of its resources.

2018 marked new developments in the multi-national Greater Tortue Ahmeyim project following the announcement of the Final Investment Decision for Phase One of the project between BP, Kosmos Energy, the SMHPM, and the Senegalese national oil company, Petrosen.

Considering these developments – and with reserves (https://bit.ly/3mF9lhb) of 120 million barrels of oil and 1.2 trillion cubic feet of natural gas – hydrocarbons are expected to surpass iron ore as the largest contributor to the Mauritanian economy, with market opportunities open for investors in oil and gas exploration, hydrocarbon refinery and storage facilities, and power generation and transmission, as well as opportunities for developers to provide supplies and logistical support to companies where oil has already been discovered.

Currently (https://bit.ly/3asIPli), Mauritania has 250 active oil and gas permits and 90 operators active in the country. The share of oil and natural resource revenue is received by the country’s national oil company, SMHPM, with these revenues managed by Fonds National de Revenus des Hydrocarbures.

Mauritania’s current legal and regulatory framework for its upstream petroleum sector is its Petroleum Code (https://bit.ly/3DAMEBH), which provides tax rules and exemptions regarding activities in the sector and promotes and regulates the production, import and export, transport, storage, and commercialization of hydrocarbons.

The Petroleum Code is designed to enable the Mauritanian Government to contribute to and benefit from upstream petroleum agreements under a production sharing contract (https://bit.ly/2YAtpJ5) (PSC), while divulging the Government’s share in revenue as well as the SMHPM’s participating interest in net cash flows.

Contractors operating in petroleum activities are granted authorization (https://bit.ly/3lsRkTR) by the state to explore, develop, and produce oil and gas in the country and are required to enter a PSC, offering the Government the option to acquire 10% interest during exploration activities and an additional 10% participation during production.

Foreign contractors operating in Mauritania are required to incorporate a local company or branch for exploration, production, and service activities. Contract holders, under the code, may also apply to extend the exploration phase of field discoveries deemed potentially commercial, encouraging the development of new oil and gas resources.

In light of the country’s bright future in its oil and gas industry, a relatively new development strategy, the Strategy for Accelerated Growth and Shared Prosperity (https://bit.ly/3v2Uy3B) (SCAPP), prepared by the Mauritanian Government and covering the period of 2016 to 2030, was validated by the Council of Ministers on 17 September 2015.

Following a detailed analysis of Mauritania’s socio-economic position, the SCAPP serves to promote inclusive, sustainable development in the country while improving governance, strengthening social development, and facilitating job creation.

The strategy (https://bit.ly/3jaBUlN) aims to foster increasingly green and inclusive high value-added activities that require large workforces in order to achieve a continuous GDP growth of at least 7% per year until 2030.

Corresponding to Mauritania’s 2030 Agenda for Sustainable Development, one of the key principles for the SCAPP is to foster and encourage specialized areas of production to promote local business activities and generate a workforce with foreign equivalent qualifications.

The role that renewable energy can play in the development of the country’s energy efficiency has been noted in the strategy to contribute to building Mauritania’s economic resilience and improve the population’s living conditions.

As one of the countries that constitute the MSGBC – Mauritania, Senegal, The Gambia, Guinea-Bissau, and Guinea-Conakry – Basin, Mauritania has become one of the most promising prospects for investors in the region.

With a privileged location on the Atlantic Ocean, connecting North Africa to sub-Saharan Africa, the country is poised to capitalize on its new hydrocarbon wealth and bolster the industry to become an important regional and international market.

In response to growing demand for renewable power, and increasing interest by international stakeholders to invest, develop, and succeed in Africa, Energy Capital & Power will hold the  MSGBC Oil, Gas, & Power (https://bit.ly/3BAnZfY) 2021 conference and exhibition on the 2-3 December 2021. Focused on enhancing regional partnerships, spurring investment and development in the oil, gas and power sectors, the conference will unite regional international stakeholders with African opportunities, serving as a growth-oriented platform for Africa’s energy sector. Find out more about the conference here: https://bit.ly/3AteygN

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