Africa Energy Transition - Sectors and Companies Driving Development

Despite fossil fuels remaining integral to Africa's economy, the region's energy transition is seeing an increase in momentum as countries capitalise on their renewable energy potential and the falling levelized cost of producing renewable energy. While many countries are advancing green initiatives, greater collaborative efforts are needed to support the alleviation of energy poverty in countries without the economic means to invest in clean energy sources. Technologies such as solar, wind, energy storage, EVs, SAFs, CCUS, and hydrogen will play a crucial role in allowing Africa to reach its climate targets.

Fossil fuels remain the primary power source in Africa and are forecasted to account for 69% of Africa's total power capacity in 2025. By 2035, renewables will contribute to a larger share in the power mix, with a forecasted share of 45% of total power capacity.

The growth of the region's battery energy storage capacity will continue to lag behind global growth rates, as African countries alongside financial institutions such as the World Bank, prioritise improving electricity access through the expansion of grid infrastructure over deploying energy storage solutions in conjunction with renewable energy projects.

Despite numerous African countries either outright banning the import of internal combustion vehicles or increasing import tariffs, the EV market in Africa is still experiencing slow adoption rates, despite signs of growth on the production side.

While Africa is a minor player globally, there has been a notable increase in renewable refinery projects in the region, with a particular focus on the production of sustainable aviation fuel.

CCUS remains a nascent technology in Africa, however, there is a burgeoning interest in the sector, with 6 projects set to come online between 2025 and 2030.

Africa's low-carbon hydrogen capacity is set to grow significantly, chiefly driven by 15 megaprojects, which account for 75% of the region's total hydrogen capacity - of which 12 are in the feasibility stage of development.

Key Highlights

• Fossil fuels are forecasted to account for 69% of Africa's total power capacity in 2025.
• By 2035, renewable energy will contribute to 45% of total power capacity, as countries within Africa advance respective green initiatives.
• In 2024, hydro-pumped storage accounted for 61% of Africa's total energy storage capacity, highlighting the current dominance of hydropower in the region. However, the region's battery energy storage capacity is forecasted to reach approximately 3.4GW.
• Africa has emerged as a potential leader in green hydrogen production, with a capacity of 19.5mtpa to date from active and announced projects. The region accounts for 29% of global feasibility projects, highlighting the high volume of project announcements but also how nascent the hydrogen market in Africa is.

Scope

• Africa climate targets, Africa CO2 emissions, Africa renewable energy potential, African leaders in renewable energy and energy storage, Africa renewable energy policies, Africa power consumption and demand, renewable power capacity and generation, decommissioning of thermal power, energy storage capacity, electric vehicle production, EV population data, African upcoming renewable refineries, CCUS outlook, African upcoming CC storage projects, hydrogen policies, African upcoming hydrogen policies, hydrogen capacity by stage and type.

Reasons to Buy

• Assess the current regional emissions, fossil fuel capacity and generation and which countries' have, and are acting on, net zero targets
• Assess the renewable energy potential of Africa and identify market trends within the renewable energy industry
• Look at the demand and consumption of power in key application areas for the region
• Assess who the largest regional players are in renewable energy and energy storage
• Develop market insight of the major technologies currently in use and proposed for the decarbonisation of the region's industries, as well as the policy framework laid out by the region's governments to accelerate their development and increase their adoption.