Working Paper 170 - Development of Wind Energy in Africa
This paper describes how Africa’s wind energy markets have evolved over the years and the structural characteristics affecting the development of wind energy projects on the continent; providing what we believe is the first mapping of the continent’s wind energy market. Results from our analysis of 94 projects on the continent suggest that wind energy markets remain small, concentrated and nascent in nature. While we observe an increasing trend in the number and size of projects being implemented, we show that wind energy contribution to the energy mix in Africa will remain unchanged over the long term. A key observation in the paper is that wind energy has limited potential to address the issue of access to electricity in Africa mainly due to the intermittent nature of electricity output from wind power plants. Wind energy is more likely to complement electricity generation from conventional sources, as has been observed in more mature markets. We estimate the cost of the 1.1 GW installed wind power capacity in Africa at USD 1.8 billion, out of which 59 percent was contributed by development finance institutions as non-concessional funding. We also notice a shift from the use of concessional funding on projects towards non-concessional funding from development finance institutions, an increasing participation of the private sector and greater use of specialized funds and Clean Development Mechanism funding. There is also emerging south-south cooperation with some experienced African firms seeking new markets across the continent. The paper finds that the public sector remains a key player in the wind energy sector, not only as a financier but also as a local partner that ensures smooth project implementation. The paper also discusses technical, environmental and financial considerations that African countries need to take into account when developing wind energy projects.
|Date of creation:||19 Mar 2013|
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