ECP Promotes African Energy Investment on Africa Day 2022

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Representing the backbone of every economy, energy is a fundamental enabler and key driver of Africa’s development. Access to reliable, affordable and sustainable energy goes beyond simply keeping the lights on, however, but drives industrialization, agriculture, and infrastructure expansion while improving access to medical, education and food services. With the continent celebrating Africa Day on May 25, and the year 2022 having been slated as ‘The Year of Nutrition’ by the African Union (AU), Energy Capital & Power (ECP), Africa’s leading investment platform for the energy sector, remains fully focused on enhancing investment and development across the African energy sector, making a strong case for energy as a key driver of food resilience and climate change mitigation.

Laila Bastati, Managing Director, Energy Capital & Power

Strengthening Food Security through Energy

Africa is facing a mounting food crisis which has only been worsened by the COVID-19 pandemic. Climate change, political and economic crises, and regional conflict and displacement have resulted in over 346 million people suffering from severe food insecurity while 452 million suffer from moderate food insecurity. While this insecurity continues to have significant consequences on the physical, mental and physiological development of the population, the burden of malnutrition transcends into the socioeconomic space, with the Cost of Hunger in Africa Study estimating that African countries are losing the equivalent of between 1.9 and 16.5% of their gross domestic profit due to child under-nutrition.

Accordingly, this year’s Africa Day is being celebrated under the theme, ‘Strengthening Resilience in Nutrition and Food Security on the African Continent,’ centered around the need to strengthen agro-food systems and health and social protection systems for the acceleration of human, social and economic capital development.

In this sense, ECP believes that efforts to achieve net zero hunger can be strengthened through the expansion and improvement of energy systems across Africa. Currently, 65% of Africa’s population relies on subsistence farming, and in order to tackle food insecurity, governments across the continent are looking at deploying large-scale modern agricultural systems, systems which require significant energy at every stage of the production stage.

“By scaling up investment in key energy industries, Africa has the opportunity to address two imminent crises: energy and food insecurity. The correlation between improved energy and food security is evident: by strengthening energy access and affordability, countries can strengthen agro-food systems continent wide, tackling food security and driving socioeconomic growth,” states Laila Bastati, Managing Director, ECP.

Scaling-up Security while Reducing Emissions

In addition to the opportunities presented through commercial agriculture, most notably food security, job creation and associated sub-sector growth, scaling up investment in clean energy will help mitigate climate change impacts across the continent. Currently, Africa’s food systems rely predominantly on traditional fuels including coal and diesel, bringing challenges of price volatility and supply and distribution disruptions. However, these challenges can be rectified through the adoption of decentralized renewable energy systems.

According to the World Bank, the implementation of climate-smart agriculture will help solve a two-fold crisis. Firstly, deploying renewable energy solutions will help mitigate the challenges imposed by climate change such as flood, drought and erratic rainfall, thereby improving food production and agro-processing while strengthening food security continent wide. There has already been success in this area with Empower New Energy and Resource Energy connecting a 700 KWp solar plant to Nigeria’s largest egg producer, Premium Poultry Farms; the first agrivoltaic system opening in Kenya in 2022; and with 10% of South Africa’s renewable systems used in agriculture.

Secondly, renewable deployment is key to reducing greenhouse gas emissions, both in the energy and agriculture space. With 19-29% of total greenhouse gas emissions generated from the agriculture sector, the application of zero-emitting technologies such as solar and wind is integral for mitigating climate change. In this regard, the World Bank is promoting climate-smart agriculture, recognizing it as an integrated approach that addresses the interlinked challenges of food security and accelerating climate change. Renewable energy technologies are at the center of this approach, and therefore, increasing investment and development across the clean energy space in Africa is critical for addressing both crises.

“As the continent celebrates Africa Day, and stakeholders accelerate the drive towards a net zero hunger economy, attention must turn to Africa’s high potential renewable energy sector. By scaling up investment in clean energy, Africa can improve food security, reduce emissions and drive long-term, sustainable economic growth,” Bastati notes.

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Energy Capital & Power

Energy Capital & Power

Energy Capital & Power is the African continent’s leading investment platform for the energy sector. Through a series of events, online content and investment reports, we unite the entire energy value chain – from oil and gas exploration to renewable power – and facilitate global and intra-African investment and collaboration.

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