In the following interview, Siemens Gamesa’s Onshore CEO Alfonso Faubel talks to us about renewable energy potential in Africa, the company’s operations, and expansion plans in the continent’s fastest growing markets
Beyond the immediate impact on health, the current crisis has major implications for global economies, energy use and CO2 emissions globally. Highly dependent on coal, oil and gas which have been hit severely, the pandemic only adds to existing challenges Africa lives by such as food insecurity, unemployment, electricity outages, floods and locust invasions. Reliable, affordable clean energy and a growing energy jobs sector are what the continent needs and deserves. Siemens Gamesa understands and is fully committed to supporting Africa in its energy transition today more than ever before.
How do you view Africa’s renewable energy potential? Where are the opportunities and challenges?
There is the potential for significant further growth, since the African continent is abundant in the resources needed to produce renewable energy, mainly solar and wind.
In addition, fast growing economies and high population growth are increasing energy demand in Africa. Indeed, with a population exceeding one billion people and an estimated combined economy of $1.5 trillion, the continent presents huge opportunities for investors, developers and operators across the renewable energy sector.
As a result, with projected GDP growth of 50% until 2024, many African countries have put in place development programmes to access renewable energies. From North to South, East to West, there are strong ambitions and programmes in place to reach 20%-50% of renewable energy share in the energy mix within the next 20 to 30 years. This is happening at the same time as energy partnerships in Africa are increasingly being granted to the private sector, which can only help to boost economic growth.
Today, renewable energy is already providing millions of people in Africa access to electricity for the first time. However, across the continent, only 40% of the population has access to electricity. The challenge remains that Africa needs a more stable evolution and growth in the sector in order to optimise the investment framework. This implies that better terms and infrastructure, such as access to electricity networks, a sizeable pipeline of bankable projects and clear procurement processes, are needed. Therefore, Siemens Gamesa is actively calling for more concerted efforts between public and private sector actors to attract private investments and technological transfer at an unprecedented scale.
What place do renewable energies occupy in the energy mix of the African continent?
Africa is still heavily dependent on fossil fuels, representing 50% of the African energy mix, oil and gas as well as coal. Not only has bioenergy’s share in the overall energy mix barely changed over the last 25 years, but it continues to dominate the primary energy mix, accounting for 60% of total energy use in the region and constituting a huge challenge to the continent. As a result, the adoption of renewable energy proffers a huge opportunity for most African countries seeking energy independence, reduction of exposure to unreliable energy imports and attainment of a state of energy security.
That said, the ultimate solution to Africa’s energy development is not necessarily from a single energy source, but rather a combination of several sources. Africa boasts a broad range of renewable energy resources, from wind and solar to geothermal and hydropower and its future prosperity requires a change from the current total reliance on conventional energy sources.
A successful renewable energy transition needs decent network development, appropriate policies to support a strong expansion of clean energy and emphasis on energy efficiency improvements. Countries like Morocco, Egypt and South Africa have demonstrated that this is possible through the launch of programmes and renewable energy targets aiming to become less dependent on imports of resources.
We think that Africa could be the first continent to achieve a significant level of industrialisation with cleaner energy sources, and specifically wind energy, playing a prominent role. And we are determined to lead this energy transition.
Can you tell us about Siemens Gamesa’s presence in Africa? Where are its existing projects and where does the company see potential new markets?
Siemens Gamesa has a strong foothold in pioneering markets while remaining very active and attentive to all African markets where opportunities emerge. In fact, more than 20 years ago, we were the first manufacturer to provide wind energy on the continent.
Today, with an installed capacity of 3.5 GW, in countries such as Morocco, Egypt, South Africa, Kenya, Mauritania, Mauritius, Tunisia and Algeria, we have more than 55% market share on the continent. In 2017, we established the first blade factory in the entire MEA (Middle East and Africa) region in Morocco, Tangier, employing 750 employees today, of which more than 95% are local work force.
Specifically, and most recently, our large presence in the continent can be outlined as follows:
- Egypt represents the largest and most rapidly evolving market for us today in terms of opportunities in Africa, with an installed capacity of 1,253 MW. At the end of last year, we completed the 262.5 MW Ras Ghareb wind farm and launched the 250 MW West Bakr Project in partnership with Lekela Power.
- In South Africa, ahead of schedule and just before the lockdown caused by Covid-19, we were able to complete two projects totalling 250 MW thanks to a major team effort.
- In Morocco, we are currently in our last phase of the 210 MW Midelt wind farm construction and earlier this year, signed a contract to build the 300 MW Boujdour wind farm, both projects part of the five planned in the integrated 850 MW programme.
- In Mauritania, our team completed the installation of 39 turbines for our 102 MW Boulenouar project.
- Last but not least, we are very proud of our recent market breakthrough: in April 2020, we signed the 59 MW project in Djibouti which will enable clean energy supply, decrease the cost of electricity and allow the 940,000 population of Djibouti and its key industries to strengthen their electrical independence and economic development.
Currently the markets with the strongest potential resources in wind power are Kenya, Tanzania, Ethiopia, Sudan and Djibouti.
Without any doubt, we are well aware of the important role wind energy can play in powering Africa’s growth, including job creation and industrial expansion, which is why, as a market leader, we are keen on marking our footprint further with the aim to help the continent accelerate its clean energy transition and stimulate economic growth in a sustainable manner.
How do you intend to continue your support to Africa’s renewable energy transition within the post Covid-19 recovery frame?
While Siemens Gamesa has been focused towards business continuity supportive to our customer and stakeholder needs, it also has been involved in its commitment to improve lives through renewable energies as part of the immediate response to the Covid-19 outbreak. For this purpose, we have joined several calls to actions to urge governments to put the renewable energy sector at the heart of any recovery plans displayed as follows:
- IRENA’s Coalition for Action Calls for Green Recovery Based on Renewables, where we are putting forward recommendations on how governments can ensure a rapid and sustained economic recovery that aligns with climate and sustainability objectives.
- The Global Wind Energy Council (GWEC) “Global Wind Industry Stament on Green Recovery” with an aim to lay out the key policy actions that must be put into motion to renew energy infrastructures.
- The “Uniting Business and Governments to Recover Better” initiative, as signatories of the science-based targets initiative (signatories since Sep 2018) and UN Global Compact
- The Green Recovery Alliance, where signatories are committed to support post-pandemic “stimulus transformation plans” that put the fight against climate change and biodiversity loss at the centre of Europe’s economic policy.
- The RenewAfrica initiative where we remain committed to accelerate Africa’s sustainable energy transition, which is aligned with the EU-Africa Strategy on Africa presented by the European Commission and the European External Action Service on 9 March 2020.
We strongly believe that by making the energy transition an integral part of the wider recovery, we can achieve a more resilient and inclusive future for Africa.
What impact is the pandemic having on your current and future projects in Africa?
The energy sector is severely challenged by this crisis, which has slowed transport, trade and economic activity. With border closures and health emergency states, it has surely impacted our operations worldwide, and so therefore also in Africa. Although we have faced several challenges such as delays in supply deliveries, provision of site accesses and travel limitations, all the wind farms under construction or maintenance by Siemens Gamesa are running well on the continent. Also, our blade factory in Morocco never stopped its operations. In conclusion, thanks to the impressive effort that our employees are demonstrating in these unprecedented times, not only are we ensuring business continuity safely, but continue to win contracts and achieve new milestones in complicated circumstances.
At a time when the Covid-19 crisis is affecting all regions of the world, and in particular the African region, how is Siemens Gamesa helping people in need in the regions where it operates?
Siemens Gamesa has launched a series of social impact initiatives to contribute to the fight against Covid-19 around the world, including a series of initiatives to help African nations impacted by the crisis. The company’s global campaign covered donations of €1m worth of healthcare supplies and other relief to hospitals and communities and allocated a sum of €350,000 dedicated to African countries severely impacted by Covid-19. These donations are in addition to the company’s pledge to match staff donations up to €1m for the International Federation of Red Cross (IFRC) Covid-19 Emergency Appeal campaign.
The support that Siemens Gamesa will provide across Africa will benefit a great number of vulnerable communities in Egypt, Morocco, South Africa, Kenya, and Jordan.
For example, in Egypt, the company is taking long-term actions such as providing medical equipment to Ras Ghareb Hospital that will not only benefit Covid-19 patients, but also provide the hospital with a set of permanent resources after the pandemic.
In addition, through the company’s SGRE Impact social commitment initiative, which focuses this year on alleviating the effects of Covid-19, food parcels and sanitary products are being distributed alongside tree planting campaigns benefiting over 6,000 individuals of the most vulnerable rural households in Morocco, South Africa and Jordan. Another project targets Kenya’s Kakuma refugee camp and aims to provide equal access to medical care and sanitary products, training courses on health and nutrition as well as water and community toilets for the 45,500 refugees.
In Tangier, where our blade factory is located, the company has provided €100,000 worth of temporary shelter benefiting local authorities in the region. The team has also organised a food and sanitary donation for 1,000 families lasting a month and a blood donation campaign involving about 35% of the workforce. We feel it is our responsibility to contribute where we can and help mitigate the effects of this crisis as much as possible.
The company recently announced that it is carbon neutral. How exactly does this link Siemens Gamesa to the fight against climate change?
Climate change is a profound, systemic challenge and Africa is among the regions most exposed to its effects. While its ecosystems already suffer disproportionately from global climate change, the region’s new renewable energy technologies, innovative digital technologies and finance tools have helped to ease the growth in the number of people without access to electricity. This in turn provides further motivation to achieving the UN Sustainable Development Goal, providing access to affordable, reliable and sustainable modern energy for all by 2030.
Late 2019, our carbon reduction strategy bore its first fruits and we became carbon neutral – a major milestone towards our long-term ambition of net-zero CO2 emissions by 2050. This was achieved with a combination of actions implemented by the company such as energy reduction and efficiency measures, relying on electricity from renewable energy-based sources, a green mobility plan to reduce fleet emissions, and offsetting non-avoidable emissions through compensation projects. These efficiency measures led to an overall reduction of 24% of our energy intensity achieving 38% reduction of greenhouse gas (GHG) emissions intensity.
In Africa only, Siemens Gamesa supports the reduction of over 8m tons of CO2 emissions having installed 3.5 GW of wind, equivalent to 140m trees that would need to be grown annually to avoid the same amount of CO2 savings.
The continent’s vast natural resources mean that low-cost clean energy technologies have plenty of potential and Siemens Gamesa is determined to continue its efforts in reaching new markets and assisting more African countries in their renewable energy targets.