“Unlocking Africa’s Potential: How Battery Storage Can Transform the Continent’s Energy Landscape”

In rural locations across Africa, renewable energy infrastructure such as hydroelectric dams, wind turbines, and solar panels have been rapidly developed over the last decade. However, the lack of battery storage systems has hindered the ability of communities and businesses to benefit from this renewable energy production.

The financing of utility-scale battery storage systems in Africa is crucial to ensure reliable access to electricity and enable communities to benefit from new infrastructure projects. Recent advancements in battery technology efficiency have made Battery Energy Storage Systems (BESS) more affordable, with the price of lithium-ion batteries dropping to $139/kWh in 2023 and projected to reach $80/kWh by 2030.

Pumped hydro storage, which generates power as water moves between two reservoirs at different elevations, presents a unique opportunity in regions like Central Africa. Additionally, the development of battery-as-a-service (BaaS) business models aims to incentivize residential, commercial, and industrial consumers to invest in battery storage technology through leasing models, reducing upfront costs.

Beyond meeting local energy needs, battery storage has the potential to stimulate the growth of a strategic new industrial sector in Africa. The continent holds significant reserves of minerals critical for the energy transition, positioning Africa as a global leader in battery technology.

Several African countries have joined the BESS Consortium at COP28, committing to deploying 5GW of energy storage technology globally by 2027. However, achieving these targets will require tapping into international pools of capital. Private investment plays a crucial role in strengthening energy storage capacity in Africa, with companies like the Emerging Africa Infrastructure Fund (EAIF) investing in solar PV and energy storage projects in countries like Mozambique and Malawi.

These projects address challenges posed by the intermittency of renewable power generation and enhance the resilience and stability of electrical grids in frontier markets. Despite the underdevelopment of the sector, Africa has the potential to become a global leader in the battery storage value chain, with the right investments and partnerships in place.