Rome, 25th June 2020 – Renewable energy sources can play a crucial role to ensure health, food and education to the African population in the Covid-19 recovery phase. This is the outcome of the study “The impact of Covid-19 on Africa’s energy sector”, developed by RES4Africa Foundation and the United Nations Economic Commission for Africa (UNECA), in partnership with SDA Bocconi and with the support of the Southern African Power Pool (SAPP) and Ethiopian Women in Energy (EWiEn). The study was presented during a virtual event held yesterday, which saw the participation of relevant representatives of the European and African energy sector, international agencies and organisations, academia and so on, and was constantly attended by over 300 participants.
Even if the spread of Covid-19 is lower than in other continents (2.67% of global infections and 1.2% of the global death rate), the research shows that the pandemic heavily impacted Africa’s economies, that are suffering severely for their dependency on other economies, by the collapse of commodity prices and for the shutdown of commercial activities in response to the lockdown measures. As a result, the 2020 African GDP growth rate is expected to decline from 3.2% to 1.8% (with a contraction of 1.4%); however, if the shock level is heightened, the GDP contraction could reach up to 2.5%. This slower growth of Africa’s economies will have major implications on poverty reduction and employment growth, possibly causing from 5 to 29 million people falling back into extreme poverty.
In such a time of crisis, electricity access plays a fundamental role in securing basic needs and services such as health, food and education; however, the impact of Covid-19 on the African energy industry is likely to have dramatic effects on the progress made in recent years in expanding access to energy. The global economic crisis that causes a decrease in energy consumption makes it harder for existing customers and businesses to pay for their energy services and African utilities, some of which were already in difficult financial situations, may further struggle to run their business. At the same time, slowed supply chains and reduced investment flows are causing energy companies to run out of cash, putting many jobs at risk and reducing the customers’ access to energy.
The RES4Africa-UNECA study explains in detail that, in this scenario, the deployment of renewables-based solutions can be a pivotal contribution to Africa’s post-Covid recovery and to improve the quality of life of millions of people, even long after the end of the pandemic. African leaders and policy makers face a historical opportunity to coordinate their recovery initiatives in response to the pandemic in order to increase their efforts in achieving the Sustainable Development Goal 7: this implies building more robust and efficient energy infrastructure systems as well as implementing decentralised energy solutions using renewable energy sources.
“In this emergency, we must take the opportunity to rethink global systems and accelerate towards an economy that is more sustainable and more attentive to everyone. It’s time to finally unlock Africa’s potential and provide renewable energy to its population” states Antonio Cammisecra, President of RES4Africa Foundation and CEO of Enel Green Power, “Covid-19 is not a signal to slow down, but a signal to speed up”.
“The investments in sustainable energy will help mitigate the impact of climate change, while widening access to energy” continues William Lugemwa, Director of the Private Sector Development and Finance Division of the United Nations Economic Commission for Africa (UNECA), “It will be essential, thanks to the economic and financial stimulus that will follow this crisis, to build and strengthen the energy system in a clean and sustainable way, pursuing a deep de-carbonisation and to prepare a more resilient socio-economic system to external shocks such as Covid-19”.
“Placing renewable energy at the heart of Covid-19 recovery measures is crucial to bridge the energy access gap and build a resilient and sustainable economy” comments Rabia Ferroukhi, Director Knowledge, Policy and Finance of the International Renewable Energy Agency (IRENA), “With the right policy frameworks in place, investments in renewables will bring much needed jobs, GDP growth and welfare gains – key to Africa’s long-term prosperity”.
“The IEA’s new Sustainable Recovery Plan shows it is possible to simultaneously spur economic growth, create millions of jobs, put emissions into structural decline and provide a substantial boost to the resilience of energy systems” adds Maximilian Jarrett, Africa Programme Manager of the International Energy Agency (IEA), “It’s a plan that could significantly benefit the energy sector and wider economy across Africa”.
“Renewables, thanks to their decreasing costs and greater resilience, as demonstrated during the coronavirus pandemic, are helping with the energy transition on a global scale, enabling society to make progress on several of the seventeen Sustainable Development Goals” concludes Matteo Di Castelnuovo, Professor of SDA Bocconi and Director of its Africa Lab.