Article by Kenneth Engblom - Vice President, Wärtsilä Energy, Europe and Africa

Africa's energy future at a crossroads

When it comes to Africa's energy future, the decisions facing the continent's leaders today are of historic importance, no more and no less. More than anything, energy systems are the fabric of business and society. Countries across Africa want to realize their goal of building massive amounts of new generating capacity in order to anticipate vast increases in energy demand and to put the continent on track toward the growth and development it deserves. With its immense energy potential and low electrification rate, Mozambique is at the forefront of this continental trend.

Energy planners know where need to go. The big question is: ?How? More specifically: what is the most economical energy matrix that can be built to guarantee all the new electricity capacity needed? Wind power, solar power, gas turbines, coal, gas engines... There are many options available, but each country has a single ideal solution.

For more than a decade, world-class Wärtsilä engineers and analysts have been using their rich experience in the African energy sector to answer these questions, country by country. We mobilized state-of-the-art, technology-neutral modeling techniques and took into account all local technical constraints and all technologies as well as natural resources. Several energy matrix scenarios were developed and compared. We ran the models in a rigorous manner and obtained telling numbers. In Mozambique, Senegal or Nigeria, among many other countries, our studies show considerable cost differences between the various possible energy strategies.

Billions of dollars are at stake

When it comes to the choice of energy technologies, it is paramount to keep an open mind, free of any preconceptions. Technologies that may be suitable for Europe, given the existing infrastructure, population density or natural resources on this continent, may not be suitable for other regions of the world. Each country or region must find the best way to build its own energy system. Many African countries, however, have one important point in common: perhaps more than anywhere else, the models point to the fact that the route to building the most cost-effective energy system is through maximizing the use of renewable energy. Our latest study: ?Planning Mozambique?s optimal power system expansion? (?Planning a maximum expansion of Mozambique's energy system?) shows that Mozambique is no exception, as in-depth modeling reveals a strong inverse correlation between the amount of installed renewable energy capacity and the total system cost.

A fact must be established once and for all. The cost of renewable energy equipment has been falling very rapidly in recent years, and when such equipment utilizes Africa's massive solar and wind resources, the cost you get per KW/h produced easily beats that of any other electricity technologies. Add to this the fact that most of the continent's power grids are relatively underdeveloped, and it is more than obvious that renewable energy should be preferred over traditional power generation systems such as coal or gas-fired power plants.

Although across the continent certain governments have set relatively ambitious renewable energy targets, it is not always possible to get very far. Contrary to what certain industrial and political leaders may think, maximizing the amount of renewable energy that can be developed for the system is by far the most cost-effective strategy available, while at the same time ensuring a stable and reliable grid.

In Africa, renewable energy is set to become the new baseload power source. Indeed, renewables are intermittent, but combining them with more flexible power generation capacities will ensure grid stability as well as providing billions of dollars in savings.

The Intermittency of Renewable Energy: A Problem with a Solution

It would be wrong to regard the intermittency of renewable energies as an insurmountable obstacle. This is not the case, as these energies are associated with highly flexible modes of electricity generation, such as gas-fired power plants.

To keep the system balanced, a source of backup and peak power must be available so that production is ramped up at a rate equal to that of fluctuating wind and solar production, but also to keep up with variations in energy demand throughout the day. The systems must be able to meet huge daily variations in seconds or minutes.

Gas-fired power plants are the only backup generation source intended to do just this. They will keep the system secure while allowing the grid to integrate huge amounts of cheap renewables. For Mozambique, studies show a difference of US$ 84 million in total system cost over the next 10 years between a system incorporating large volumes of renewables coupled with flexible gas-fired generators, and a system based on inflexible thermal generation with minimal renewable capacity. Between now and 2050, the cost savings could run into the hundreds of millions of dollars.

Renewable energy and flexible gas: the two pillars of a good energy strategy

Renewable energy and flexible gas are the two pillars of a good energy strategy for Africa. Similar studies in other African countries indicate that this energy matrix strategy will produce billions of dollars worth of energy efficiency across the continent in the coming decades.

Highly ambitious renewable energy targets across Africa are not only achievable, but are the most robust and cost-effective strategy for successful electrification of the continent. Smart strategic decision-making will lead to more resilient electricity systems and offer vastly improved system efficiency as a whole. 

About Wärtsilä

Wärtsilä is a global leader in smart technologies and complete lifecycle solutions for the marine and power markets. The company has delivered 76 GW of power plant capacity in 180 countries around the world. In Mozambique, Wärtsilä designed, built and currently operates the 174 MW gas engine-powered CTRG power plant which is partly owned by EdM.