Geopolitics of energy in africa 13 04-2013


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Geopolitics of energy in africa 13 04-2013

  1. 1. Bernard DUHAMELVice présidentAssociation pour le Développement de l’Énergie en Afrique
  2. 2. WHAT IS AFRICA? 53 Countries 6 geographical Sub regions: 6 Island countries : 5 North African countries : 15 West African countries : 8 East African countries : 9 Central African countries : 10 Southern African countries :14 Landlocked countries
  3. 3. WHAT IS AFRICA?Africa Demographic Evolution 1950 – 20501950 2000 2050 %Total1950%Total2050Worldpopulation2 535 6 124 9 191 100 100NorthAfrica44 141 237 2 3Sub-SaharanAfrica180 680 1761 7 19TotalAfrica224 821 1998 9 22
  4. 4. Comments about African population growth This strong increase is mostly due to Sub Saharan Africa(SSA) where GDP per head is the weakest in the world($1,946 in PPP, which is about 2/3 that of South East Asia).In that region, the demographic transition, althoughstarted, will not be achieved by 2050 and thedemographic increase will continue throughout the rest ofthe 21st century. In 2005, 2/3 of Sub-Saharan Africa’spopulation were below 25 years of age. As a whole, the population of Africa is more and moreurbanised (but note that almost 75% of urban populationin the SSA are slum dwellers). Since 1950, the urban population has multiplied by a factorof 11 but despite this, urbanisation in SSA - 37% in 2005 -is still the lowest in the world. Presently, the urbanpopulation growth is due more to internal dynamismrather than to rural migration. Corresponding urbanisation rates are 40% in Asia and 78%in Latin America.
  5. 5. Comments about African population growth Despite strong urban growth Africa’s rural population isstill growing; doubling between 1960 and 2000 andscheduled to continue between 2000 and 2030 to grow but2 times less quickly. It is clear that this strong demographicgrowth will create significant developmentproblems, where solutions will more often than not requirean energy dimension In order to feed Africa’s population by 2050agricultural production in Africa will need to bemultiplied by a multiple of 5.14. Thus, nowhere will Africa’s population explosion bemore felt than in the increased energy demand that itwill create. If one can imagine current (unsustainable)traditional energy consumption habits of Africa’s poor, andmultiple them by a factor of almost 2.5 (i.e. the populationgrowth from 2000 to 2050), one begins to have an idea ofwhat the implications of such growth might be.
  6. 6. A main feature of the 6 subregionsOverview Rate of Urban Population by Countries and RegionNumberofcountrieswithNorthAfricaWestAfricaCentralAfricaEastAfricaSouthernAfricaIslandCountries> 40% 5 7 3 1 3 420% <--<40%0 6 4 4 5 2< 20% 0 2 2 3 2 0
  7. 7.  Africa remains a continent characterised byrelatively lower urbanisation levels, for examplemuch of Sub-Saharan Africa has urbanisationrates of not exceeding 37%.
  8. 8. Impact on the electrification rateUrban and Rural Electrification Rates in AfricaPopulation(Million)Urban(Million)Rural(Million)PopulationWithoutelectricityPopulationWithElectricityElectrifi-cationrateUrbanElectrif.RateRuralElectrif.RateNorthAfrica143 74 69 9 134 93.7% 98.8% 87.9%Sub Sah.Africa688 242 446 526 162 23.5% 51.5% 8.4%AFRICA 831 316 515 535 296 35.6% 62.4% 19.0%Source: World Energy Outlook 2004, International Energy Agency (IEA)
  9. 9. A main weakness: Climate change impacts Up to 250 million inhabitants – more than 2/3 of the EU’spopulation - will be exposed to hydro stress, More than half of the continent (Sahel countries, Easternand Southern parts) will be affected by food insecurity, In terms of health-relatedimpacts, malaria, meningitis, cholera (as a consequence offlooding) are predicted to recur with renewed intensity, Forests which are covering one fifth of Africa’s surface aredisappearing at the highest rate in the world (5 millionha/year) Thermal dilatation of oceans is threatening populatedcoastal areas, all the more as many industrial zones havebeen built near the shore (for example, in Senegal).  ADAPTATION ?  RESILIENCE ?
  11. 11. An ENERGY point of view aboutAFRICATHREE main regions: North Africa: 5 countries Middle Africa: all sub-Saharan countries, tropical andequatorial countries, all island countries South Africa: 1 country North Africa and South Africa account for about 75% ofthe continent’s energy consumption North Africa  mainly oil and gas South Africa  coal and oil products Middle Africa: ¾ of the population but ¼ of the energyconsumption
  12. 12. A main weakness :the very low energy consumption The total African energy consumption is below the one ofGermany. The middle Africa energy consumption is below the one ofPoland. In sub Saharan Africa (outside South Africa) theenergy consumption /year /capita is about 100kOE, while it is 8 000 in the USA and 4 000 in OECDcountries It has to be understood as a cause and also a consequenceof the weak economic development. More than 60% ofAfrican people have less than 2 $ a day. More than 60%of African people have no access to commercial energyand must use only biomass and/or fuelwood.
  13. 13. ENERGY CONSUMPTION PATTERNS For the great majority of Africa’s population, especially itsvillages but also urban areas, low levels of access to energymeant that key basic needs such as lighting and adequatecooking facilities are not covered. The poverty of a largeproportion of Africa’s population is the key reason for theirintensive use of traditional energies, which while being moreaccessible are nonetheless more costly per unit, in particularbiomass. In Africa, where all too much of urbanisation has takenthe form of shanty tows around the larger cities, it has beenestimated that some 30% of the urban population live belowthe poverty line of USD 1$ per inhabitant per day, against acorresponding 80% of Africa’s rural population. The use of biomass also raises the question of foodpreparation, for which biomass is widely used in rural Africa.Biomass consumption in Africa represents one-quarter ofglobal consumption. Africans’ energy consumption patterns, of both traditionalenergies (e.g. wood cuttings and charcoal) and modern energysources, are related to population’s revenues.
  14. 14. ENERGY USES / INCOMEBasicAdvanced14
  16. 16. Energy in Africa by sources: OilDistribution of oil reserves:Algeria Lybia Nigeria OthercountriesOil 21% 17% 27% 35%
  17. 17. Energy in Africa by sources: Gas Natural gas is abundant in North Africa(Algeria, Libya, Egypt)  domestic uses + electricityproduction + industrial uses + Exports It is abundant in West and central Africa  mainlyexports to EU and USA (Gas liquefaction plants inNigeria, Equato Guinea …), a small electricityproduction and some industrial use (Ivory Coast, Nigeria)
  18. 18. Energy in Africa by sources: GasDistribution of natural gas reserves :Algeria Egypt Nigeria OthercountriesNaturalgas56 % 18,5 % 14,2 % 11,3 %
  19. 19. Energy in Africa by sources: coal 90 % of coal reserves are located in SouthernAfrica where coal is used heavily for powergeneration, as in Zimbabwe and to a lesser degree inMorocco and Niger where coal represents a significantpart of national energy consumption (± 20%). More than one third of Africa’s coal production isexported.
  20. 20. Energy in Africa by sources:Biomass Africa is the world’s largest consumer of biomassenergy. It is for the most part consumed by Africanhouseholds, especially in rural areas (85% of householdenergy) and comprised primarily firewood as well as somecharcoal, but also animal dung, agricultural residues ... The consumption of “traditional” fuels is highly labourintensive, inefficient, polluting, and destructive to theenvironment. A key point is the striking regional character of the biomassconsumption : it accounts for some 85% of total energyconsumption in Sub-Saharan Africa, compared with5% in North Africa and 15% in South Africa.
  21. 21. Energy in Africa by sources:Bio energy Africa has a significant potential for expanded ethanolproduction and co-generation and for biofuels namelybiodiesel (for instance, about half of the land in Africacould be considered suitable for Jatropha cultivation). Co-generation installations can provide the support basis formini-networks in isolated areas, as experiments in anumber of countries has shown (e.g. Mozambique,Tanzania, Kenya, Uganda etc). Mauritius, for example,secures 20-40% of its electricity needs through co-generation but on the whole Africa is under equippedcompared to other developing countries and regions suchas Latin America or India.
  22. 22. Energy in Africa by sources:solar energy Promotion of photovoltaic solar power has for long been animportant focus in Africa, borne partly from a long-awaitedexpectation of a significant decrease in its costs which to-date has notreally materialised and which as led to a number of photovoltaicprojects being abandoned in the meantime. On the basis of a halvingof costs for every ten-fold increase in production it is hoped that acost basis of € 2000/kWc can be reached by 2020 for the systemsconnected to the network - which in fact will mean that it remains arelatively expensive energy. Nonetheless, photovoltaic power can beviable in numerous cases, such as telecommunications, health centres(e.g. vaccine conservation) and daytime pumping of groundwater. A very promising solution appears to be the thermal exploitation of thesolar power, through Concentrated Solar Power systems The DESERTEC project has been defended by Germancompanies: it foresees implementing solar sophisticated anddiversified equipment in order to cover 10% to 15% of energyneeds in Europe.
  23. 23. Energy in Africa by sources:wind power Windmill-generated power remains interesting forelectrification projects above a certain threshold of unitary sizeof windmills and according to wind systems. Windmill capacity in Africa is weak : 0.5 % of the productionat the world-wide level. With the exception of the Maghreb and Egypt few projectshave been undertaken. In Morocco, the development windfarms has become more and more widespread, supported byinternational financing organisations. The significant wind potential in East Africa and in theHorn of Africa should nevertheless contribute to diversifyingthe energy base of Eastern Africa. Wind energy development in Africa will however need to be ableto benefit from public subsidies. Another area of development priority must be the intensifieduse of windmills for water pumping in Sub-Saharan Africa,which is significantly under-exploited compared with SouthAfrica (300,000).
  24. 24. Energy in Africa by sources:Geothermal Regarding geothermal energy, there is strongpotential in East Africa (estimated at 9-10GW), where the key question is to which depthexploitation should be undertaken. At shallowdepth, the heat harnessed (at approx. 70° Celsius) isnot sufficient to produce electricity, while deeperexploitation the steam captured (which exceeds 200°Celsius) is accompanied by toxic emissions that aredifficult to treat.
  25. 25. Energy in Africa by sources:Nuclear Energy The principal producers of uranium in Africa are Niger(8.5% of global production in 2003), Namibia (7%) andSouth Africa (2.5%). South Africa’s two uranium plants produce three timesmore energy than from renewable energy sources such asGeothermal and solar energy. A number of countries (Morocco, Egypt Libya, andNigeria) have indicated their intention to develop anuclear energy generation capacity, with the goal ofdesalination of sea water. In reality, such steps would create a number of complicatedproblems with regard to infrastructure and humanexpertise, as well as with regard to adherence internationalnon-proliferation treaties, and it is probably more realisticto consider such developments in a longer time frame.
  27. 27. The AFRICAN ELECTRICAL SECTORExploitation rate of hydro potentialEurope NorthAmericaLAC Asia Africa75 % 60 % 33 % 22 % 5-7 %
  28. 28. The AFRICAN ELECTRICAL SECTOR Installed capacity(2006) :Africa : 106,3 GW,Sub-saharan Africa : 66,8 GW = SpainSSA outside SAR = Argentina (30 GW). Consumption : Africa : 488 TWh 532 kWh per capita per year := 1/5 World= 6 % Industrialised countries
  29. 29. The AFRICAN ELECTRICAL SECTORConsumption per capita per year: North Africa 952 kWh West Africa 155 kWh Central Africa 151 kWh East Africa 65 kWh Southern Africa 1767 kWh
  30. 30. Electricity consumption per capitaagainst number of countries by regionElectricity consumption per capita against number of countries by regionNumber of countriesinNorthAfricaWestAfricaCentralAfricaEastAfricaSouthernAfricaIslandCountries> 2 000 kWh 1 0 0 0 1 1500 <--< 2 000 kWh 4 0 1 0 4 1100 <--< 500 kWh 0 6 2 2 3 1< 100 kWh 0 9 6 6 2 3
  31. 31. ROLE OF THE SMALL SCALE HYDROPOWER Adapted to remote rural areas and to multiple energy/wateruse. Africa possesses a huge untapped potential, most notablyin Eastern and Southern Africa due to the significant landtracts that occur at high altitudes in these regions. Small-scale hydro power comprises power units below 10MW, with a yield of 60% to 90% and an average output of3,500-6 000 kWh /year per installed kW. The life span is ofabout 50 years without big investments. Production costsdepend on the hydrologic and weather systems, but in generalsmall-scale hydro power is considered as one of the lesscostly options for securing sufficient rural electrification inorder to develop productive activity. Hydro power potential is known with regard to Africa’s largerivers but is generally unknown for the many smaller rivers.Yet, an increasing number of rural electrification projects areoriented towards harnessing the potential of small rivers
  32. 32. ELECTRIFICATION GOALS Regarding possible electrification goals the AfricanDevelopment Bank has published 2 scenarios in2008 forecasting an almost complete electrification ofAfrica by 2050 (with interim milestones leading to45% electrification by 2015 ( 31% for SSA) and 95%electrification by 2030 (94% for SSA). According to a World Bank analysis, SSA couldachieve a goal of 35% access to electricity by 2015through regional exchanges of electricity. It impliesthat, every year, 3,000 MW will be added to theproduction capacity and 3 million new households willbe connected to national grids, at an estimated cost 6 –7% of SSA’s GDP.32
  33. 33. Poles of Hydro power in Africa33
  34. 34. Investing in the Africa’s Energy Sector According to the Infrastructure Consortium for Africa(ICA) the needs of investment for allinfrastructures in Africa would be about US $ 80Billion per year. Energy infrastructure represents half of thisamount, meaning that US $ 400 Billion in ten years,half for maintenance and half for equipment, willbe requested for a proper development of Africa.34
  35. 35. Investing in the Africa’s Energy Sector However, according to the AfDB, the scenario of thecomplete electrification of Africa in 2030 will requirean annual investment of US $ 23.8 Billion.NorthAfricanCountries(5)SouthAfrica(1)Sub-SaharanAfricaCountries (41)IslandCountries(6)Indicative averageinvestment per annum inconstant US $ (2005)7.5 4 12 0.335
  36. 36. Financing Energy Infrastructure Financing energy infrastructure in Africa is tackling adiversified reality of energy development, mixinggrids and non grids systems, renewable andconventional energy. It will be a combination of private and publicfinancing, of local and foreign, international,financing. Summing up all these resources, combined with adynamic development pushing ahead the fightagainst poverty, can permit Africa to face thechallenge of improving its energy infrastructure36
  37. 37. CHALLENGES OF INTEGRATIONTo what conditions shall the great projectsbe fulfilled :Agreement about mutual dependanceor interdependance;Harmonisation of rules and laws;Procedures of arbitration andmechanisms of solving disputes;A business atmosphere friendly forinvestors.
  38. 38. A new energy paradigm for AfricaAfrica is significantly affected by the consequences ofclimate change, and its sustainable development isdependent upon the adoption of effectivemeasures to combat global warming.AdaptationA new paradigm for Africa could inspire sustainablemodes of energy production and consumption,but this will depend on Africa’s prospects for gettingout of poverty, which requires a demanding 7%annual increase of GDP per capita (whenpopulation growth effects are factored in).38