The International Energy Agency’s (IEA) Energy Efficiency 2024 report says that while progress slowed during COVID-19 due to lower economic growth in 2020 and rebounding energy demand in 2021, the continent has seen efficiency recover since 2022.
Since 2010, energy demand in Africa rose by 2.2% on average per year, while annual GDP growth averaged around 3%, leading to a rise in energy intensity of 9% across the period.
Between 2010 and 2019, several countries achieved annual intensity gains of at least 4% on average over the period: Gabon, Côte d’Ivoire and Rwanda each improved by 4%, while Togo and Ethiopia reached 4.5% and 5.7%, respectively.
Governments across Africa taking steps to improve energy efficiency
The report says that governments are taking steps to implement policies that accelerate this progress.
For example, Ethiopia adopted legislative initiatives to enhance efficiency and set a target of 8% annual improvement until 2050 in the country’s Long-term Low Emission and Climate Resilient Development Strategy (2020-2050).
The African Energy Commission and the European Union are developing the first African Union Energy Efficiency Strategy (AfEES), with goals for the continent as a whole.
The strategy includes plans for each sector of the energy system. It also aims to increase energy productivity by 50% by 2050 to ensure the long-term decoupling of economic growth from energy consumption.
Investment in Africa’s end-use sectors is expected to rise significantly to $9 billion in 2024, up from just over $5bn in 2023.
Despite this growth, Africa captures only 3% of global energy investments, totalling about $110bn, with nearly $70bn directed toward fossil fuels and energy grids.
“The continent faces several barriers to attracting more investment, including a growing debt burden, low credit ratings, and high capital costs.
“Several measures can support growth in efficiency investment: stronger policy frameworks to reduce investment risk; the use of public capital to leverage private sources; and implementation of new financing structures,” the report said.
The public and private sector have already launched several initiatives.
For example, the African Development Bank finances efficiency initiatives through the Sustainable Energy Fund for Africa (SEFA) to unlock private sector investments.
The report notes that by 2030, SEFA aims to approve projects totalling $10.5bn, which is expected to generate 1,614 TWh/year in energy savings.
Second-hand markets are the main source of energy consuming product sales in Africa.
“In 2022, vendors of used and refurbished construction equipment reported a 20% increase in sales to African countries.
“Similarly, used vehicles account for over 80% of all new registrations across the continent.”
The report says that in Nigeria, the demand for affordable mobility led to a ninefold increase in imports of used vehicles from 2017 to 2023.
While second-hand markets provide access to appliances, this has come at a cost in terms of energy demand.
“Second-hand cooling appliances can use two to three times more electricity than new models.
“Imported used vehicles can be 15-20 years old, increasing fuel use and presenting a public health risk through more frequent accidents and exposure to fine particles.
“Governments are implementing measures to regulate second-hand markets.”
The report lists South Africa, Egypt, the Seychelles and Sudan as countries that have imposed a ban on the import of used vehicles.
As of 2022, 25 countries have regulations to limit the age of imported vehicles, and 19 countries have emissions standards.
For appliances, there has been advancement in mandatory MEPS, for example in Ghana and South Africa.
“Next to introducing regulations, governments are aiming to make new and efficient products accessible and affordable, with Mauritius, Rwanda, and Ethiopia providing tax incentives for the import of electric vehicles.”
While financial incentives play an important role, IEA analysis shows that efficient appliances do not necessarily cost more than inefficient alternatives.
“And while initial costs are similar, efficient appliances are usually much cheaper over their lifetime and can reduce costs by up to 60%.”
The report says growing momentum towards electric mobility is paving the way for efficient transport, with African countries “rapidly adopting” e-mobility solutions.
“In a region where motorisation rates are some of the lowest globally, there is significant potential to leapfrog the transition by adopting EVs and bypassing the era of mass ICE vehicle ownership.
“Cities are at the forefront of this transition. In Dakar, the Senegalese government launched the first electric bus rapid transit system in Africa in 2023, which is expected to transport up to 300,000 passengers daily. Similarly, electric buses were introduced in 2024 in Addis Ababa, Accra and Cape Town.”
African cities are also witnessing a remarkable growth in electric two- and three-wheelers.
Many African governments view EVs as a way to foster local manufacturing and reduce reliance on imports.
“Ethiopia opened its first EV manufacturing facility in 2024. Earlier in the year, Ghana’s first e-bikes assembly plant opened, and Uganda announced a new plant to manufacture hybrid and electric buses, with an expected annual production capacity of 2,500 vehicles.
In Rwanda, Ampersand has partnered with Chinese firm BYD to produce 40,000 electric motorcycles in Kenya and Rwanda by the end of 2026.
“Nigeria aims to achieve 30% local production of EVs by 2033 as part of its 2023 Automotive Industry Development Plan, with a target for the production of two-, three-, and four-wheelers.”
The report says that buildings continue to dominate energy consumption in Africa, but that efficiency policies are reducing their energy intensity.
“Buildings are responsible for over 50% of total final energy consumption in Africa.
“However, there are significant differences between countries. The residential sector in Ethiopia, for example, consumed 86% of total final energy in 2022, twice that of Nigeria (42%) and over six times that of South Africa (13%).”
On the continent as a whole, total energy consumption in buildings grew by more than 30% from 2010 to 2023. In the same period, the energy intensity of buildings – measured by energy per m2 of floor space – decreased by 9%.
“This indicates that energy efficiency policies have helped to offset higher energy demand in a growing number of buildings, with more people gaining access to better living conditions as a result.”
A number of countries, such as Ghana, Côte d’Ivoire, Rwanda, Senegal, South Africa, Egypt and Morocco, already have building energy codes in place to improve energy efficiency.
“Energy efficiency is a key pillar of secure, affordable and inclusive energy transitions. The IEA is working closer than ever with governments around the world to ensure that it remains a top policy priority,” said IEA Executive Director Fatih Birol.
“Fortunately, the policies and technologies to accelerate efficiency progress are readily available today, and many governments are taking important steps forward. What we hope to see now is faster and stronger policy responses across the globe.”
Access the International Energy Agency’s (IEA) Energy Efficiency 2024 report
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www.iea.org/reports/energy-efficiency-2024
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