New types of fuel could help make Africa a market powerhouse.
Africa is at a turning point, with the potential to shift from being a supplier of raw materials to becoming a leader in advanced manufacturing, particularly in the growing green hydrogen market. Collaboration is key to this vision. African nations need to focus on developing the full value chain, from research to manufacturing, to unlock new opportunities in the energy sector.
The continent is blessed with abundant solar, wind and hydro resources, making it an ideal location to produce green hydrogen and renewable fuels. Instead of competing for leadership in green fuel production, African nations should align their strengths and resources to develop a comprehensive energy strategy. For example, southern Africa’s superior solar resources can be harnessed for large-scale solar farms, while coastal regions with high wind potential can provide the energy required for electrolysers in Namibia, Egypt and East Africa. Through shared infrastructure and distribution channels, African countries can supply green hydrogen to Europe and the US.
The goal is not only to produce green hydrogen for export but also to drive local demand and consumption. There is a need to localise the entire value chain – processing mined platinum group metals (PGMs) locally, developing technologies for electrolyser and fuel cell manufacturing and expanding green hydrogen applications across the continent.
Grow the market
Africa’s potential to dominate the global green hydrogen market is significant, but there are challenges to be addressed. Currently, Africa’s demand for green hydrogen is limited and there is a risk that an over-reliance on exports could make the continent vulnerable to global market fluctuations. To mitigate these risks, African countries should diversify their energy mix, develop capabilities in related technologies like fuel cells and electrolysis and encourage domestic green hydrogen consumption in sectors such as transportation and power generation.
At the same time, collaboration among African countries will allow for the aggregation of demand and a larger internal market for green hydrogen, increasing scalability. By fostering local industries and workforce development programmes, African nations can ensure that they maintain control over the value chain, creating jobs and bolstering their economies.
The numbers speak volumes about the urgency of Africa’s need to collaborate. With an estimated GDP of R55 trillion in 2023, Africa must leverage its collective economic power to compete with larger markets like the EU, US and China. The economies of South Africa, Egypt, Nigeria and Morocco alone account for nearly half of Africa’s GDP.
With platforms like the African Continental Free Trade Area (AfCFTA) and initiatives within the African Union, Africa already has the foundation for this collaboration. Now is the time to build on these efforts and turn Africa into the world’s powerhouse for green energy.
Text | Viren Sookhun
Photography | Audio und werbung
Viren Sookhun is Managing Director at Oxyon People Solutions. For more information, go to oxyon.co.za.
