Africa's Energy Poverty Needs Working Solutions with Joshua B. Narh, Director, Wingfield Group, Ghana

The global energy transition is here. Some continents are faster at adopting the needed changes. Others, not so much. What is clear in the case of Africa, is the fact that the continent needs more than policies to drive the energy transition in countries all the way to local communities.

The Director at Ghana-based Wingfield Group, Joshua B. Narh tells Energy! why Africa needs to chart her own course and do what works based on existing realities.

Possibility of Africa Receiving More Climate Finance from the West in Coming Years

We may well be living in our own world of delirium and fantasy. And here is why; in 2009, developed countries agreed to raise USD 100 billion per year by 2020 to assist less wealthy nations in dealing with the fallout from global warming. That promise was broken. According to OECD data, to date, only USD 79.6 billion of the USD 100 billion per annum commitment has been met, with only about 26 percent going to Africa between 2016 and 2019. Also, there isn't a clear roadmap or accounting method in place to show how they will put the USD 100 billion per year on the table, let alone how we will track it. We don't have time to waste and Africa is one of the most vulnerable regions in the world. Believe me when I say that the West's climate finance pledges are merely political commitments.

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The calls by climate activists for less hydrocarbon exploration and production in Africa

Their sentiments are admirable, and it speaks to many people around the world who are rightly concerned about the effects of climate change on our environment. However, it is also a misguided sentiment. Too often, the debate over climate change and the need for less hydrocarbon exploration is dominated by a Western narrative.

It completely ignores the needs of low-income Africans who would benefit greatly from a strategic approach to oil and gas operations in Africa; to name a few, it reduces energy poverty and enables job creation, as well as entrepreneurship opportunities. According to Carbon Brief, since the beginning of the industrial revolution, African nations have polluted 7 times less than China, 13 times less than the United States, and 18 times less than Europe.

As such, we cannot hinder our best opportunities for economic development by simply aligning with the Western view of how to address carbon emissions. We deserve to fully explore our oil and gas to make energy poverty history. African countries should and will exploit their hydrocarbon resources for economic development. Environmental sustainability is an enabler, not a hindrance.

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The possibility of reducing GHGs in Africa while exploring hydrocarbons

I believe African countries are confronted with an existential dilemma: how to advance their economic transformation and industrialization paths while also reducing greenhouse gas emissions. I am highly skeptical that Africa's 3 percent contribution to global greenhouse gas emissions since the industrial revolution is a major contributor to the climate change effects, we are witnessing.

The major contributors to greenhouse gas emissions, such as the United Kingdom and Norway, continue to hold licensing rounds aimed at increasing exploration and production. The exploitation of Africa's oil and gas resources is critical to the continent's socio-economic development.

Climate scientists are increasingly agreeing that reducing emissions will not be enough to avert the worst effects of global warming. Instead, scientists argue that humanity must capture previously emitted carbon dioxide and store it underground, where it cannot escape into the atmosphere and warm the planet. Carbon capture and storage, or its derivative, carbon dioxide removal, is still an expensive and contentious technology for sucking carbon out of the atmosphere and burying it deep underground.

To be candid, we are not well-positioned to reduce greenhouse gas emissions in our high-emitting sectors due to a lack of available technologies, regulatory frameworks, and financial and economic capacity. We deserve to fully develop our oil and gas resources so that energy poverty is a relic of the past. As such, Africa must increase licensing rounds, increase exploration, and position itself as the primary supplier for domestic and global markets.

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Overview of Ghana’s Energy Industry

Ghana’s energy sector has evolved over the last two decades. This is due to continuous reforms and stability that allowed for increased investment by private players, especially in the electricity sub-sector. In addition, the discovery of oil and gas in commercial quantities in 2007 and subsequent production in 2010, further put the country’s energy sector on the path of growth.

In 2020, the global energy sector was dramatically affected by the outbreak of the novel coronavirus disease (COVID-19). Governments’ lockdown measures and travel restrictions worldwide aimed at halting the spread of COVID-19, had a considerable impact on energy demand and supply. Global demand for oil and other forms of energy (especially electricity demand in productive sectors) significantly reduced. The fall in oil demand, coupled with the price war between Saudi Arabia and Russia, saw a sharp fall in oil prices. Despite the negative effect of COVID-19, modest progress in Ghana’s energy sector was made in 2020. The Government of Ghana took certain measures related to energy in a bid to mitigate the effect.

This has contributed to the higher levels of Ghanaian economic growth we are seeing now. Natural gas has also taken the lead in power generation and the pursuit of greater energy autonomy. Ghana's economy is now one of the most dynamic and fastest-growing in West Africa. However, beneath these enhancements are inefficiencies, including extremely high distribution losses. In Ghana, electricity is also quite expensive. If these issues are not addressed, they have the potential to derail Ghana's development agenda.

Our power generation sector is thriving, with both public and private companies involved. Power sector reforms in the 1980s gradually removed barriers and created a level playing field for independent power producers to participate in an area previously dominated by public sector participants. As countries transition their economies to using less carbon, we are looking at building a balanced energy system anchored on high energy security, universal access at affordable prices, and low emissions.

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Foremost energy school of thought

Most countries' energy sectors have been in turmoil for the last 10 to 15 years. Many developing countries have attempted to restructure their energy sectors, but reforms have proven difficult to implement. The reasons for this include the number of actors involved, shifting perceptions of the relative roles of the market and governments, and the accumulation of policies over the past decades, many of which made sense when they were proposed but now impose unsustainable burdens.

Meanwhile, a steep rise in global energy prices over the last two years, as well as growing concerns about the supply of conventional petroleum (and natural gas in some parts of the world), have added urgency to national and international energy policy discussions.

To put it mildly, the current energy outlook is bleak. Whether governments are primarily concerned with economic growth, environmental protection, or energy security, it is clear that continuing current energy trends will have many unfavorable consequences at best, and pose grave global threats to the well-being of the human race at worst.