Africa can decarbonise faster than the rest of the world

3rd June 2022 By: Saliem Fakir

It is oxymoronic to talk of Africa decarbonising, as, with the exception of South Africa and a few other countries, the continent has the lowest per capita carbon footprint.

A recent analytical piece published in the UK’s Guardian Weekly on May 20 noted that the pledges being made by Big Oil and Gas are not in sync with what is happening in reality. The International Panel on Climate Change (IPCC) states that carbon emissions must be reduced by half by 2030 and, for that to happen, we should not be digging out more oil, gas and coal.

The Guardian Weekly analysis shows that, despite the IPCC’s warnings, investments in fossil fuel projects are surging.

The Guardian Weekly dubbed these investments as ‘carbon bombs’, noting that 195 large oil and gas projects are enough to generate one-billion tons of carbon dioxide, which is almost a decade’s worth of China’s emissions.

It is a case of ‘talk green and walk right’. The war in Ukraine has, in a short space of time, forced the abandonment of righteous lecturing to others about decarbonisation. The conflict, which started when Russia invaded Ukraine on February 24, is pushing Europe into a hunt for more gas.

In its recently released RePowerEU plan, the European Union (EU) states that it will reduce its dependence on Russian gas, while diversifying its sources of supply through increased investments in alternatives. Interim measures also have the danger of ensuring fossil fuel dependence for much longer than anticipated.

Botswana noted recently that it had never seen such a surge in demand for coal from European energy firms looking to secure new supplies of coal – so, coal is also in the game.

The US, Qatar, Saudi Arabia, Australia and a few African States are positioning themselves to fill the void left by Russia. The race to the bottom has already begun.

Nobody suggested transitions are linear – they are, at best, troublesome processes that are highly dependent on politics, deployment capacity and the rate of technology innovation that can be mustered.

The war situation and the fact that the EU has permitted gas and nuclear to be part of the green finance taxonomy has effectively locked in gas supply from the African continent for the foreseeable future. There is no point in continuing the charade and double standards.

The move has emboldened African gas producers to position gas as their transition fuel, as poignantly noted in the Kigali Communique, released on May 20, at the conclusion of the Sustainable Energy for All Forum, which was held in the Rwandan capital.

African countries should be cautious about how they view the gas bonanza staring them in the face. It may not be sustained if the technology wave for alternatives moves sufficiently in the right direction that it renders these options and sunk costs redundant.

Nobody really knows what will happen in the future, since not everything lasts forever. There is a strong case to not be largely reliant on a single source of revenue; there must be other means of withstanding the vagaries of life. Resilience should be through diversity, not singularity.

Adam Tooze, a prominent economist, suggests in a piece published in the May 13 edition of Foreign Policy that Africa is going to be the next big place for investments. This development will be caused by a major demographic shift. Africa’s large geography has been accompanied by a small demographic base, but that is all going to change in the twenty-first century. The continent’s population will reach 2.5-billion by 2050, and this will have tremendous implications for Europe, which is fortifying itself against migration as its population ages.

The shift in demographics – with populations to be concentrated in urban centres – has the potential to bring about significant political change, given that most African political leaders are ageing and not giving enough space for younger leaders to shine and place new aspirations on the table. Without economic and political change, upheavals are inevitable.

Owing to the demographic shift, it is forecast that Africa will account for 25% of the world’s population by 2050 and that there will be a further increase in the continent’s population to 4.2-billion by 2100, which will be equivalent to about 40% of the world’s population.

Nigeria, an oil- and gas-producing country, will lead this demographic shift, with its population projected to increase to about 400-million by 2050. To illustrate the challenge of oil and gas dependence, Nigeria had the largest share of poor people in 2018.

The potential for decarbonisation is much greater for Africa than is the case for other parts of the world. Several things are in the continent’s favour: abundant solar, wind, hydro and geothermal resources, as well as vast land areas and critical minerals.

Africa’s disadvantage is that, for a decarbonisation revolution to take place, it needs cheaper sources of capital, sustained reliable demand for energy, access to technology, and favourable trade policies. It also has to nurture a flotilla of flagship companies – State owned and private – that can corral local entrepreneurship around joint ventures with overseas equipment manufacturers and project developers.

This may seem all far-fetched but, with the right enabling conditions, Africa’s competitiveness as the most decarbonised continent can be a strategic investment driver for countries seeking to avoid penalisation as a result of the carbon intensity of their energy sectors.

We have a glimmer of this possibility in the form of the surge in interest in green hydrogen production. There is a furious effort in making green hydrogen happen in Namibia, South Africa, North Africa and other places.

There is a danger, though, that, without entangling these investments with a sound industrial strategy, the hydrogen molecules themselves will become just another tradable commodity such as oil and gas – with high demand and a low value. Despite the push by some to continue to entrench fossil fuel exports, we must ensure that decarbonisation is not a lost opportunity for Africa. Oil and gas may make us seem prosperous in the short term, but may well squeeze out prosperity in the future.