Page 8 - Vol 28 Issue 29 2019

products & projects

Energy Development since increased investment is aligned with US policy as well as
sound business consideration.
To Relieve The
Infrastructure Africa is renowned for its abundance of renewable energy resources,
amongst which include wind, solar, geothermal and hydropower.
Restraint These constitute a consequential impetus for regional energy
The African Continental integration. Progression and mobilisation of such clean renewable
Free Trade Area agreement energy sources through regional collaboration efforts afford the
(AfCFTA) will constitute the continent’s citizens improved environmental quality. “Developing
world’s largest free trade area, renewable energy resources to address the demand for energy
consolidating an integrated in Africa, will be in the spotlight at the upcoming Africa Energy
market of 1.3 billion consumers Indaba. The conference will discuss the AfCFTA and how investors
with a combined gross domestic and energy project developers can benefit from the agreement
product (GDP) of approximately and how this can catalyse the development of renewable energy
$3.4 trillion. The objective is to realise a continent-wide single projects.” commented Liz Hart, Managing Director, Africa Energy
market for goods and services with free movement of business, Indaba.
persons and investments. Similarly, renewable energy resources are site specific and
The AfCFTA envisions to expand intra-African trade and intensify can therefore be exclusively transported through electricity
regional integration by successively eliminating tariffs on 90% of interconnections. Additionally, power interconnections remain the
product categories. Removal of such trade barriers assures to only expedient alternative to making fuels or resources such as
not only improve efficiency, enhance competition, and incentivise lignite, hydropower and renewable resources, available to other
development of strategic solutions to local challenges through areas. Electricity interconnections, realised by regional integration,
regional economies of scale, but essentially advance the efficacy enable the expansion of these energy resources to benefit the
of resource allocation. continent at large.
Successful implementation of the agreement is set to have a
profound impact on the continent’s energy sector. Regional
integration pertaining to energy, represents a viable solution
for emerging economies to enhance their energy landscapes African Union to
in furtherance of realising social, environmental and economic roll out continent-
benefits owing to improved efficacy of resource utilisation. wide electricity
Regional integration is pivotal to ensure that energy resources get
from localities where they are most affordable, to where they are market masterplan
required. The African Development
Correspondingly, regional integration on account of the AfCFTA, Bank (AfDB) and the
is forecast to improve security of supply. Integrating operational African Union Development
reserves and installed capacity enables combined power Agency (AUDA-NEPAD)
systems from having to invest in additional facilities. In the event have agreed to jointly
of emergency situations, regional collaboration provides an develop a blueprint for a
alternative source of supply for operating reserves and support pan-continental electricity
thereof. Moreover, sharing with neighbouring countries can network and market.
provide advanced system flexibility and reliability by expanding The agreement to set up a Continental Power System Master
the supply portfolio of diverse energy resources as opposed to Plan between the Bank and AUDA-NEPAD was unveiled recently
exclusively relying on regional and established resources and during a three-day workshop on the sidelines of Programme
supply infrastructure. for Infrastructure Development (PIDA) Week held in Cairo. The
To address the continent’s existing energy infrastructure gap, workshop also produced the Masterplan’s terms of reference.
African governments are proactively aiming to expand electricity “The Continental Power System Master Plan will ensure that
access, deliver clean cooking solutions and pursue inclusive competitive electricity markets are developed at regional and
sustainable energy development. While these efforts are locally continental levels, creating unique opportunities to optimally
supported through existing platforms such as the regional power utilise Africa’s vast energy resources for the benefit of Africa,”
pools, the AfCFTA provides an entirely new platform to expand said Professor Mosad Elmissiry, a senior energy advisor to AUDA-
these efforts regionally and pursue energy development to relieve NEPAD’s CEO.
the infrastructure restraint. For instance, one key anticipated The workshop was aimed at advancing the launch of an Integrated
outcome of the agreement is the acceleration of industrial output Continental Transmission Network to link national power utilities
that would comparatively depend on the availability, affordability into regional power pools and, ultimately, into a continent-wide
and security of energy supplies at a scale for industrial growth.
transmission network. Plans also include setting up a market for
Improved energy trade and energy integration initiatives will boost electricity trading.
economic development in Africa by reducing transaction costs The Masterplan also will inform the energy component of a PIDA
and enabling market and economic collaboration, conclusively Action Plan, which focuses on key regional integration projects.
accelerating investment incentives. Further, removal of
impediments to intra-African trade by AfCFTA portends additional Development of a unified electricity transmission network and
US public and private investment in Africa’s oil and power sectors, market for electricity trading are viewed as a critical priority to

8 | AFRICAN POWER Mining & Oil Review Vol 28, Issue 29, 2019 Celebrating 10 years of excellence