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. For this transformation to happen, African countries must work together, combining their resources and talents to build a strong local economy. By doing so, they can reduce reliance on imports and foster innovation within the continent.
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. With the right partnerships, Africa can become a self-sustaining energy powerhouse and play a major role in the global shift towards sustainable energy.
Unlocking Africa’s green energy potential
With a world increasingly focused on decarbonisation and sustainable energy, Africa finds itself at a pivotal juncture. 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, establishing themselves as major players in the global energy market.
Building a unified value chain
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.
To make this vision a reality, African countries must invest in skills development, build local industries, and create new technologies. Manufacturing key components of the green hydrogen industry domestically will reduce reliance on imports, stimulate job creation, and spur economic growth. Additionally, existing infrastructure, such as ports and pipelines, should be used to expedite the distribution of green hydrogen both locally and globally.
The importance of regional cooperation
By sharing resources, standardising policies, and conducting joint research, African countries can pool their strengths to create economies of scale. A multi-country approach can facilitate investment, foster regional trade, and ensure that Africa competes effectively on a global scale.
The planned green hydrogen pipeline from Namibia to South Africa, extending down to Saldanha Bay and Johannesburg, is an example of the kind of large-scale development needed across the continent. Such projects demonstrate the benefits of shared infrastructure, which can serve both local consumption and export needs.
Africa’s place in the global energy 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.
A future powered by collaboration
The numbers speak volumes about the urgency of Africa’s need to collaborate. With an estimated GDP of $3.1 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. If African countries compete against one another rather than working together, they risk being left behind in the global energy transition.
The future of Africa’s green hydrogen economy lies in cooperation. By aligning resources, sharing knowledge, and investing in skills development, African countries can accelerate their transition to a green hydrogen economy, reduce their carbon footprint, and create new industries and job opportunities. This collaborative approach will not only position Africa as a key player in the global energy market but also drive economic development across the continent.
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. The continent cannot remain in development mode forever – by working together, African nations can become leaders in the global energy transition.