What does a just transition mean for Africa?
What does it mean for particular countries?
Who pays for it?
As African countries, like the rest of the world, move away from dirty fuels for power generation in favour of renewable sources, there should be no trade-off between the environment, people’s welfare and economic growth.
A just transition should attract investment, create new industries and jobs, and help countries to achieve energy security and climate resilience.
Social protection is especially a crucial component of countries’ energy transition plans because a significant portion of the population will be affected. Reskilling, upskilling, and creating new jobs are among the ways to ensure a just energy transition for workers and communities.
Transition roadmaps, investments drivers
To unlock the finance needed to leapfrog the obsolete energy systems of the past in favour of modern, people-centred, and cost-effective renewable energy systems, countries need to first mobilise domestic resources and then negotiate more with developed countries and investors to boost investment flows to Africa.
To this end, countries should prepare their energy transition plans (ETPs), presenting a clear picture of the dynamics of their energy markets, their targets and opportunities to investors and development partners.
Nigeria and Ghana, for example, have taken the lead in developing and costing their energy transition plans using a robust data analysis supported by Sustainable Energy for All (SEforAll).
Nigeria’s energy transition plan and integrated energy plan offers a $23 billion investment opportunity in the near-term across a portfolio of projects that relate to energy generation, transmission, and distribution. Such frameworks align technology, resources, and governance—giving investors and development institutions a clear picture of the investment landscapes and existing opportunities.
The energy roadmap already helped Nigeria secure a $1.5 billion commitment from the World Bank.
Nigeria’s transition roadmap indicates that the country will need $410 billion in incremental funding to fund the transition between 2021 and 2060. This pathway offers an opportunity for job creation of up to 840,000 jobs by 2060.
For Ghana, the energy transition and investment plan indicates that the country would need $550 billion in capital investment by 2060, creating 400,000 new jobs.
Ghana’s blueprint provides a solid pathway forward to help the country achieve net-zero energy-related carbon emissions by 2060 by deploying low-carbon solutions across key economic sectors, such as oil and gas, transportation, and power. To achieve this, Ghana will focus on deploying six main decarbonising technologies. They include electrification and renewables, carbon capture and storage, low-carbon hydrogen, battery and electric vehicle technologies, clean cooking technologies and negative-emissions solutions.
Investment in energy transition technologies could create three times as many jobs as fossil fuels per investment dollar, and up to 14 million energy transition jobs could be created in Africa by 2030.
New energy models
Meeting Africa’s needs requires a new model of energy provision, moving away from outdated models based on centralised infrastructure, towards more modern, integrated energy solutions that link centralised and decentralised approaches, take advantage of Africa’s massive renewable energy potential, and link to agriculture, other productive sectors, and social services.
People-centered and increasingly renewable energy powered systems have multiple benefits but will require deliberate plans and policies to realize this potential, mobilize appropriate finance, and avoid the pitfalls of unjust energy transition.
The mining of mineral inputs and new energy infrastructure must meet human rights, social and environmental standards. Scarce material resources must be managed to generate long-term prosperity. Proposed new technologies should be carefully evaluated. Africans will need to be proactive to ensure the narrative of “just transition” is not appropriated by polluters, and African initiatives are not captured or diverted to meet the interests of donor countries, transnational companies or other foreign interests.
Just energy transition partnerships (JETP)
South Africa, a coal-dependent economy, is part of the Just Energy Transition Partnerships (JETP)—a financing mechanism that aims to bridge the gap between developed and developing nations in the shift to clean energy.
In this partnership, wealthier nations fund a coal-dependent developing nation to support the country’s own path to phase-out coal and transition towards clean energy while addressing the social consequences.
The first JETP emerged from COP 26 in Glasgow, when South Africa was promised $8.5 billion in financing by France, Germany, the United Kingdom, the United States, and the European Union.
South Africa’s JET investment plan identifies areas such as transmission and grid-balancing storage, renewable energy generation, energy efficiency, rehabilitation of municipal electricity delivery, green hydrogen, and new electric vehicles. It would cost a sum of $98.7 billion to implement the first phase of the plan by 2027.
Central to the plan are safety nets for vulnerable workers and communities, especially coal miners, women and youth, affected by the move away from coal.
The scale of resources required to implement African countries’ transition plans is massive, no doubt. The dominant narrative is that Africa lacks the resources, and so will need to borrow more to fund the transition. In fact, as well as addressing the structural economic flaws such as food gaps and a low industrial base, African governments have a range of tools at hand to enhance the generation of domestic resources over time. One is to address the lack of productive capacity—such as skilled labour, technical know-how, and capital equipment—to begin scaling up domestic production without adding to the need for external inputs and debt.
Complementing this is the creation of more accountable markets and institutions, by addressing market concentration and abusive practices that misallocate resources.
