Enel Green Power is playing a leading role in the development of renewable energy in Morocco, South Africa and eastern Africa, where rapidly-growing economies are stimulating energy demand.
Rapid population growth, abundant resources and a growing energy demand are the reasons why many African nations have chosen renewable energy to respond to their needs, and EGP is playing a leading role in the development of renewable sources in this continent.
South Africa was the first African market that the Group entered into, where it recently grid-connecting its Upington plant and is beginning wind and PV solar projects that will eventually have a capacity exceeding 500 megawatts. In Morocco EGP participated in an important tender for 850MW of wind power capacity and pre-qualified together with three other groups: this will be the largest investment in wind power in the region over the last 4-5 years, and the result of the tender will be announced in early 2015. In Egypt it is also aiming to develop wind and solar power, while the Group is assessing the possibility of geothermal development in Kenya.
Some East African countries, like Kenya, Tanzania and Uganda have a combined potential geothermal capacity that exceeds 15GW. The African Development Bank (AfDB), one of the energy sector’s main funding bodies, estimates that current investments in the industry are around $100 million and believes that figure could more than double over the next five years.
The combination of population increase and rapidly growing economies could generate in the medium-term a middle class of 450 million people, which will have obvious effects on both energy demand and as such the energy market.
It should also be pointed out that the fiscal and monetary policies implemented by a number of governments have over the last few years led to a considerable reduction in inflation and debt, which has helped to increase the attractiveness of these countries to investors.