the herald
business journalist
TEN possible sites for solar power plants, with a potential output of 500 megawatts, have been identified, a senior official said, with the government now working on guarantee mechanisms with creditworthy financial institutions to ward off potential investment risks.
As the renewable energy sector, particularly solar, attracts growing interest, concerns have been raised about currency convertibility risks, viability gaps and potential losses that investors could incur due to tariffs. undereconomic,” said Permanent Secretary for Energy and Power Development, Eng Gloria Magombo. interview.
Zimbabwe, which seeks to increase its renewable energy capacity to 1,100 MW or 16.5% of global electricity supply by 2025 and to 2,100 MW or 26.5% of total generation by 2030 in line with climate goals, needs huge capital inflows to achieve the target.
“We will call to develop new projects, (propose) standard power purchase for solar projects and tender documents,” said Eng Magombo, adding “we should see a boom in investment in these projects “.
Dr. Magombo noted that concerns over currency convertibility remained one of the main obstacles to attracting foreign capital, but that a guarantee mechanism to reduce these risks was being developed.
Eng Magombo said the country received a grant from the African Development Bank to help develop the framework. “He’s at an advanced stage.”
Zimbabwe has seen modest investments in solar energy by local private investors, but “it is not yet at the scale we want”, said Eng Magombo, noting that local banks “are not willing to provide low-cost, long-term financing. for renewable energies.
Energy experts said that while renewables presented huge opportunities for investors, worries about currency convertibility and lack of long-term financing were among the barriers hampering investment.
“Any (funding) model that can work for the country would be (supported by) risk-reducing renewable energy investment frameworks,” said Jeremiah Mushosho, environment, climate change and renewable energy specialist. to the United Nations Development Program in an interview. .
Mr. Mushosho said that while the government had made progress in “de-risking” by offering incentives such as the suspension of duties and taxes for renewable energy projects, unfavorable financing conditions remained a significant impediment to projects. necessary investments in the renewable energy sector. “The cost of financing remains unattractive and return on investment is not guaranteed,” Mushosho said.
Blended finance, a mix of public and private capital, was key, Mushosho noted, adding guarantee mechanisms from regional international financial institutions could help accelerate foreign direct investment in the renewable energy sector.
While it has the least carbon footprint, Africa is the hardest hit by its effects.
The continent is responsible for about three percent of global greenhouse gas emissions – a tiny proportion considering that the wealthiest 10 percent of the world’s population are responsible for emitting more than half of the emissions. of carbon.
Despite this, more than 35 African countries, including Zimbabwe, and more than 1,000 companies have pledged to reduce emissions in line with the goals of the 2015 Paris Agreement on Climate Change, which aims to keep global warming going. below two degrees Celsius and to fight for a ceiling of 1.5 degrees by 2030. Investments in renewable energy would be boosted by off-grid household systems and mini and huge solar and wind power plants.
Globally, investments in renewable energy continue to grow and gain momentum despite global uncertainties, but are still far from sufficient to avoid the effects of climate change, according to the latest data from the International Renewable Energy Agency.
At the end of 2021, global renewable energy generation capacity stood at 3,064 gigawatts (GW), increasing the stock of renewable energy by 9.1%, the report said.
Although hydropower accounted for the largest share of total global renewable generation capacity at 1,230 GW, IRENA’s 2022 renewable capacity statistics show that solar and wind continued to dominate new capacity of production.
Together, the two technologies contributed 88% of the share of all new renewable capacity in 2021. Solar capacity led with a 19% increase, followed by wind power, which increased its generation capacity by 13%, the report says.
“This continued progress is another testament to the resilience of renewables. Its strong performance last year represents more opportunities for countries to reap the multiple socio-economic benefits of renewable energy.
“However, despite the encouraging global trend, our new Global Energy Transitions Outlook shows that the energy transition is far from fast or widespread enough to avoid the disastrous consequences of climate change,” said IRENA’s Director General, Francesco La Camera.
To meet climate goals, renewables must grow at a faster rate than energy demand.
However, many countries have not yet reached this stage, despite the significant increase in the use of renewable energy for electricity production, indicates the
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