africa in the global energy framework

1.Africa in the Global Energy Framework
March 2011
Ross Bruton, Research Analyst
Energy and Power Systems
Africa

2. Discussion Guideline
Forecast Timeline for the Global Energy Market
Global Investment Profile into Key Base Infrastructure
African Electricity Generation and Consumption
The African Energy Mix
African Electricity Demand and Supply Analysis per Region
The Asian Influence in the African Market
Key Market Challenges and Drivers Influencing the African Electricity Market
Key Messages
3. Forecast Timeline for the Global Energy Market, 2010 - 2030
Key Challenges
2020
2025
2030
2010
2015
Fuel Supply and Cost
Demand for Liquid Fuel falling after 2015
Energy from Waste in Emerging Markets
Coal Reaches almost 45% of Energy Consumption, following Growth in India and China
Resurgence of Nuclear
Continued Acceleration of Coal Fired Power
Growth of Natural Gas Kept in Check by High Gas Prices
Acceleration of Natural Gas
World Energy Demand
World Energy Demand Almost Double 2000 Levels
Growth Dominated by India and China
Long Running Boom in Russia
Developing Countries Pass 40% of Electricity Demand
Electricity Generation Passes 30 trillion kWh
Growth Resurgence in All Regions
China Overtakes the US as the Worlds Biggest Emitter of CO2
Environmental Issues
Accelerated Investment in Carbon Capture and Storage
World CO2 Emissions Reach 40 Gt
20% Renewable Energy in Europe
Significant Growth in Renewables
Source: Frost & Sullivan
4. Level of Investment Into Key Infrastructure, 2005 2030 (Billion USD)Power infrastructure represents the key area of investment for Africa
Total Forecast Investment, USD
$22,160bn
$9,000bn
$7,800bn
$1,590bn
Europe
Water
Power
Road and Rail
Air/Sea Ports
North America
Middle East
Asia/Oceania
South America
Africa
Even after this investment, demand will still outstrip supply- there is room for ongoing investment on the same scale over the period to 2050
5. Africa Generation and Consumption of ElectricityAfrica accounts for 3.1% of global generation and 2.9% of consumption
Net Electricity Generation in Africa by fuel, 2009
(Percentage)

Africa generates approximately 3.1% of total world electricity generation and consumes 2.9% of total consumption

6. Growth of electricity generation on the continent is expected to remain largely dependent on fossil fuels 7. However, renewable energy programs are being developed in both Sub-Saharan Africa and the North African Region Net electricity generation in Africa by fuel, 2007-2035,
(TWh)
Net Electricity Consumption in Africa by fuel, 2009
(Percentage)
Source: EIA
8. African Energy MixTotal Generation Capacity in Africa Amounted to Approximately 161300MW in 2010
Feedstock Distribution (Africa), 2010

Southern Africa utilizes coal as its primary feedstock in electricity production

9. Hydro power is the primary resource available for electricity production in Central and East Africa, with diesel and geothermal resources also utilized in the East 10. Due to the significant abundance of hydrocarbon deposits in West Africa, the major resource for energy production in these regions is natural gas and liquid fuels, primarily diesel 11. This is also the case for North Africa, however natural gas represents the region primary feedstock for electricity generationCoal
Percentage Share of Generation Type, 2010
Gas
Hydro
Diesel
Oil
Nuclear
Geothermal
Source: EIA
12. African Electricity Demand and Supply AnalysisIncreases in investment in energy and power is expected to increase supply security in Southern Africa
Growth in Installed Capacity 2010 - 2014

Growth in installed capacity is expected at an average CAGR of 7.89% for 2010 to 2014

13. Most significant growthexpected in North Africa 14. Forecast CAGR of 9.16% 15. Market expected to be stunted in the near term due to instability in the region 16. Reserve margins below take into account nominal generation capacities without consideration for lower plant efficiencies 17. When this is considered, a significant demand/supply gap is apparent for the continentSource: Frost & Sullivan
Supply and Demand per Region, 2010
(% Indicates Reserve Margin)
Forecast Supply and Demand per Region, 2014
(% Indicates Reserve Margin)
18. The Asian InfluenceThe total value of committed Asian investment in Sub-Saharan African was $4.9 billion in 2008
Investment by Asian Countries in the Sub-Sahara African Electricity Sector, 2008
Over $800 million
Over $500 million
Over $200 million
Over $40 millionUnder $40 million
In 2008, China Exim Bank was the leading Asian project financer accounting for 90.3% of committed investment in the year
19. Key Challenges Facing the Energy Market
Key Market Challenges and Drivers to the Energy Market in Africa, 2011
Challenges Faced
Political Instability
Funding Constraints
Decentralisation of National Power Markets
Shortage of Supply
Increased Investment from the East
Interconnection of Power Pools
Abundant Supply of Renewable Resources
Interconnection of Power Pools
Market Drivers
20. Key Messages

There is currently a large deficit of electricity supply in Sub-Saharan Africa

21. Africa is planning significant investment into the energy sector due to increasing demand 22. The development of regional power pools and trading mechanisms represents a greater security of supply to many regions 23. Emission reduction is not a key concern for the majority of African countries, however, this may be dictated through loan conditions set by international monetary funds 24. New investment into the sector from China represents a significant opportunity for market development 25. Where from here?

africa in the global energy framework

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