Developing a renewables-powered hydrogen economy across Africa could support global emission reductions efforts, and create resilient, sustainable growth in the region. There is much to be optimistic about with regards to the role of hydrogen in Africa’s energy transition; what is now required is for optimism to turn into real action.
According to the United Nations Economic Commission for Africa, nearly 600 million people across Africa are still without access to electricity. Many of the regions that do have electricity suffer from power outages and high energy costs – a significant barrier to economic development. And much of the continent’s electricity needs are still met by fossil fuels, and this is likely to continue for at least the next decade.
Solving this energy trilemma – providing more reliable energy to more people, keeping that energy affordable, and reducing reliance on carbon-emitting energy sources at the same time – will open a path for industrial development and prosperity in the decades to come.
Hydrogen, and building a strong hydrogen economy, could be the key stepping stone in this process. If we unlock this potential, the continent of Africa could offer a blueprint for green industrialisation, where economic growth and decarbonisation go hand-in-hand.
The opportunity of hydrogen
Africa has an abundance of natural resources. It is the continent with the greatest potential for solar energy in the world. To date, however, only five gigawatts of solar power – less than 1% of the global total – has been installed across the continent.
The IEA projects that by 2040 solar power could overtake hydropower and natural gas to become the largest electricity source in Africa in terms of installed capacity, along with wind energy.
If this growth of renewable energy does indeed materialise, then we must consider how we can utilise that for economic development across the continent. We must also ask if we should adopt the model of building high voltage transmission lines and sending the generated electricity to the demand centres.
If the supply is stable, then this makes sense. But given the intrinsically intermittent nature of renewable energy, it would be very costly for consumers.
This is where the case for hydrogen comes in. Hydrogen is an ideal storage medium for renewable energy, and it has the potential to serve as an alternative fuel for industrial heat once the supply system exists to accommodate it.
This could be particularly effective in sub-Saharan Africa where the production of green hydrogen could allow energy markets to be more self-sustaining.
Local industries could also benefit from the production of hydrogen, or ammonia, with green electricity, using it as an alternative to fossil fuels.
In North Africa, which is geographically much closer to the demand centres of low carbon fuels for existing industries in Europe, hydrogen can be exported through pipelines or in the form of ammonia, as a hydrogen carrier, and can still be cost-competitive if we consider the competitive leveraged cost of electricity from renewable energy.
Hydrogen also has the potential to serve as a carbon-free fuel for sectors like steel and cement – those heavy industries that enable the continued infrastructure development and economic growth of the region.
Some countries, such as Namibia, could thrive on future markets for low-carbon metallics.
Using green hydrogen in direct reduction plants to move up the value chain, industries could become exporters not merely of ore, but green iron and steel, strengthening the industrial base and enabling sustainable, long-term development.
Realising hydrogen’s potential
There are, however, several obstacles still to overcome if we are to realise the potential of hydrogen – not only across Africa.
In addition to the need for renewable energy, the most significant barrier for renewable hydrogen is the cost of electrolysers. The shortage of large-scale facilities has meant an under-developed supply chain, which in turn has made equipment and production relatively expensive.
We also need demand for hydrogen, particularly from high volume industries like minerals processing, transport, as well as power generation, to stimulate the production of hydrogen.
Looking at other parts of the world, successful hydrogen projects have several factors in common.
Firstly, an appreciation of, and a new approach to, partnership and collaboration. We have seen that a cluster approach – between technology providers, energy companies, investors, research institutes, and governments – allows for true sector coupling and integration of the entire hydrogen value chain from production to transportation, storage, and utilisation.
Secondly, successful projects utilise technology and infrastructure that is available right now and can be future-proofed. This includes the conversion of existing large-scale gas turbines and the use of complementary technologies such as heat pumps or carbon capture.
Third, they can rely on clear and long-term policy and regulatory environments that incentivise the shift to low or zero-carbon technologies with initial public funding, and ensures investor confidence and security.
Fourth, they have viable business cases and the ability to attract financing. More needs to be done to explore new viable financial models for low-carbon solutions to reduce risk and accelerate adoption, but momentum is growing.
And lastly, and probably most crucially, the adoption of hydrogen and other low carbon technologies needs people who can deliver it. So, jobs and skills development will need to come into focus much more to make these projects and the vision of a hydrogen society a reality.
