The UK’s interests in Africa’s energy industry has tilted from fossil fuels towards supporting clean energy projects: hydrogen and renewables development on the continent, considering a pipeline investments worth over $13 billion in clean energy, as reported by S&P Global Platts.
Last year, UK started reducing its support to investments in dirty fuels abroad and completely discontinued any further assistance this year amid the clean energy transition the country is now championing.
According to S&P Global Platts, Alastair Long, the UK’s trade commissioner for Africa is reported to have suggested the UK government’s support to private sector investment pipeline in Africa exceeds GBP10 billion ($13.6 billion), and these are all in clean energy projects.
“We have managed to switch the scale and level of oil and gas investments for renewable investments (in a year), which partly is about the speed of change,” Long said on the sidelines of Africa Oil Week held in Dubai.
“What is interesting for the UK is how in Africa our contribution to renewables is considerably greater than other parts of the world because we have Africa specialized companies.”Alastair Long, Trade Commissioner, UK
Particularly, the UK is interested in supporting offshore wind farms in Africa, which remain few and far in-between, Long said.
Nearly 22% of Africa’s 232 GW of installed power was in renewables in 2019, according to International Renewable Energy Agency.
Given certain conditions, the UK may still support some oil and gas projects, Long said. “There are a few caveats that allow us to support hydrocarbon specific projects where they are in compliance with a nation’s Paris commitments.”
One example is Globeleq’s 450 MW gas-fired power project in Mozambique, which is in line with the country’s clean energy goals.
Pressures for transition to clean fuels heighten
Despite making its grievances clear to the global community on the threats of energy poverty and energy insecurity at the COP26 summit in Glasgow, the pressure on African governments to quickly jump onto the energy transition bandwagon appears not to recede. Meanwhile, the continent accounts for only about 4% of total global emissions.
At the Africa Oil Week, African ministers have expressed their frustration with the global community’s pressure to switch to energy transition, with many speakers adducing the need for security of supplies and access to power.
According to S&P Global Platts, the debate “worried” Long, who contended countries should not kick against the wave of change but adopt a twin approach of developing hydrocarbon assets while embracing energy transition.
“One of the things that worries me… is the growing comfort people were giving each other around, let’s all continue using oil and gas.
“There are still ways to have gas in the energy mix, but like the Mozambique project, to be using it very targeted to provide energy in a smaller timeframe and also to invest revenues in renewables and have a clear map and process around it.
“There is risk that [gas] demand will fall drastically and then you will have a stranded asset. We can optimize hydrocarbon production to support the transition, that’s the message.”Alastair Long, Trade Commissioner, UK