The African Solar Industry Association (Afsia) has highlighted some of Africa’s dormant, “but brimming with potential”, sectors that can realise new sources of revenue and universal access to clean energy.

In its 2023 yearly 'Solar Outlook’ report, which was released on January 18 during the World Future Energy Summit, in Abu Dhabi, Afsia outlines the main segments with major opportunities in Africa as being commercial and industrial (C&I), green hydrogen, solar-powered mobility and the productive use of energy (PUE).

The C&I segment, which accounted for 28% of newly installed capacity in 2022 and recorded growth compared with 2021 capacity, is led by South Africa. Afsia says C&I growth will continue across the continent, with more than 5 GW of projects under development.

The report then singles out green energy as a high-potential sector, given Africa’s stellar solar irradiation levels. Afsia is confident that Africa offers some of the best conditions for green hydrogen production.

In terms of solar energy, Afsia says the exponential growth of electric mobility on the continent is a gateway to lower transport costs.

Additionally, the new solar segment of PUE, supported by solar home systems and minigrids, is included in Afsia’s “opportunities” prognosis; however, the report points to a growing clamour for more to be done to empower people with revenue-generating solutions.

The Afsia outlook includes a country-by-country analysis of installed capacity and manufacturing potential of solar energy systems. The association says it is no longer just South Africa, Morocco and Egypt undertaking solar developments, but 49 African countries are considering at least 1 MW of solar installations, and 29 are considering more than 100 MW of solar installations.

As it stands, Africa is home to more than 10 GW of identified solar projects, which marks a symbolic milestone for the continent, notes Afsia CEO John van Zuylen.

Globally, countries added an estimated 220 GW to 260 GW of new solar photovoltaic (PV) installations in 2022, bringing the total global solar installed capacity to 1.15 TW.

This 2022 capacity addition is equal to 24% to 29% of all the solar PV that had been installed historically. In 2021, 191 GW of solar PV capacity was installed, which, at the time, represented 27% of all historically installed capacity.

While 2022 had been a slightly less exceptional year for solar in Africa compared with the global level, it was a good year nonetheless. The continent recorded 1 GW of new PV capacity installations, marking 14% year-on-year growth compared with 2021.

GREAT PROSPECTS

When comparing newly added or total installed solar capacity between the world and Africa, one must recognise that Africa is still very much underperforming when considering its size, population and/or solar potential, notes Afsia.

Africa now hosts less than 1% of the global installed solar capacity and installed less than 0.5% of the 2022 global new capacity installed.

“As such, one may say that solar in Africa is regressing compared to the rest of the world,” the organisation states.

Yet, Africa offers lots of opportunities when it comes to solar and these opportunities can be very different than in other parts of the world, it adds.

The first such opportunity lies in the C&I segment. This segment already represents 28% of the 2022 new capacity installed, with a year-on-year growth of 60%. This exponential growth is set to continue as more than 5 GW of C&I projects under development have already been advertised in one way or another.

This represents almost 50% of the total installed capacity across the continent to date. Out of this 5.3 GW under development, 3.4 GW is based in South Africa alone.

Moreover, developed economies are increasingly demanding green hydrogen, particularly cheap green hydrogen.

The report estimates there to be 115 GW of large-scale hydrogen projects under development in Africa, of which 52 GW involves green hydrogen. This represents five times the total installed solar capacity in Africa.

While Afsia warns that not all the projects will come to fruition, the association believes the combination of attractive economics of green hydrogen in Africa, and developed economies pushing for these projects to be developed so they can import supply, will drive project realisation.

Meanwhile, Afsia says PUE is a new segment in the solar ecosystem and allows for some kind of economic activity. PUE is at the intersection of solar home systems and C&I.

Afsia is compiling what it expects to be a comprehensive catalogue of PUE, in efforts to increase awareness and understanding about minigrid and solar home system solutions and how it can be revenue generative. 

The association plans to publish this report in March.