Africa's promising renewables acceleration

By Bloomberg New Energy Finance

The three largest markets for utility-scale renewable power over the 2014-16 period are forecast to be South Africa with 3. 9GW likely to be installed, the largest part of which will be wind, followed by solar PV with a smaller amount of solar thermal; Kenya with 1. 4GW, mainly geothermal and wind; and Ethiopia with nearly 570MW, largely wind with some geothermal.

In July, Abengoa of Spain secured the debt of $US142 million from the African Development Bank towards the development of its 100MW Xina Solar One solar thermal project in South Africa; and in March, Lake Turkana Wind Power agreed $US650 million in borrowings from a group of development banks and local lenders towards its 310MW wind project in Kenya.

Derek Campbell, Cape Town based analyst for BNEF, said: "The joker in the pack for the Sub-Saharan region is likely to be rooftop and other small-scale PV, which has the potential to enjoy explosive growth in Africa's towns and cities and also in rural areas not connected to the grid. "Small-scale solar needs viable financing models, since the initial capital outlay is too high for most households.

Reproduced with permission. *Methodology: Estimates for Africa's renewable energy build-out are based on projects that have reached financial close as well as those at earlier stages in major countries that have received some benefit – for example, the projects cited in Kenya’s short-term energy strategy and the winners of the first three rounds of South Africa’s renewable energy procurement program.

The advance of renewable energy in Africa reflects a combination of growing local need for power, and awareness that the cost per MWh of clean options such as wind and photovoltaics has declined sharply over recent years.

Bloomberg New Energy Finance forecasts that investment in clean energy excluding large hydro in Sub-Saharan Africa will be $US5. 9 billion this year, down 5 per cent on 2013's figure of $US6. 2 billion, but that it will accelerate to $US7. 7 billion in 2016.

Read more here: Business Spectator


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