Malawi’s economic growth will be powered by renewable energy

Storm clouds hang over a rainbow as a motorcyclist rides past a field of maize after late rains near Malawi's capital Lilongwe, February 1, 2016. REUTERS/Mike Hutchings/File Photo
opinion

Storm clouds hang over a rainbow as a motorcyclist rides past a field of maize after late rains near Malawi's capital Lilongwe, February 1, 2016. REUTERS/Mike Hutchings/File Photo

Malawi aims to create a diverse energy-generation mix that incorporates cost-effective green sources, to enhance its energy security in the face of climate impacts and escalating global fossil fuel prices - but it requires about $3.6 billion to put its plans into practice

Lazarus Chakwera is the President of Malawi.

Malawi may be a small country. However, that is not impeding us from going big where it matters: renewable energy.

A series of solar-powered stations have recently been integrated into our national grid - and more such installations, including wind farms, are in the pipeline. These initiatives are designed to complement our longstanding reliance on hydropower.

Our objective is to create a diverse energy-generation mix that incorporates cost-effective green sources, thereby enhancing our energy security strategy in the face of climate impacts and the escalating global expenses related to fossil fuels.

One noteworthy achievement is the activation of the Golomoti solar plant, which is accompanied by a backup battery storage unit, ensuring the stability of our power system. Additionally, the 60-megawatt (MW) Salima solar station has also become operational. These advancements enable us to extend power connections to numerous households and businesses. Furthermore, plans are in place for the development of the 150MW Mzimba wind farm.

Of course, we have not been immune to challenges. The nation has experienced a succession of five severe natural disasters over the course of three years, underscoring the urgency of reinforcing both current and future infrastructure against climate-related catastrophes.

Adaptation strategy

As part of our commitment to climate change mitigation, we are implementing an adaptation strategy that extends beyond power stations and grid modernisation. We are investing in resilient roads, bridges, rail networks and ports, designed to endure climate shocks and provide reliable support to our industries, agriculture, and businesses.

The 350MW Mpatamanga hydropower station, a collaborative endeavor between the public and private sectors, is set to double the installed hydropower capacity in Malawi upon its completion.

This step will significantly enhance power supply security and facilitate the integration of more affordable renewable energy into the grid. The flexibility of hydropower allows it to serve as both a baseload and spinning reserve, reinforcing our energy landscape.

Estimates indicate that this project alone could potentially boost Malawi's economic growth by up to seven percentage points in the medium term.

It's not lost on me that Malawi's electrification rate remains low at under 20 percent. We recognise the importance of diversifying our energy mix. Incorporating solar, wind, and other clean and flexible technologies is a central tenet of our National Energy Policy.

The policy targets a rise in Malawi's connectivity rate from 18 percent to 30 percent by 2030 and even higher beyond that horizon. However, achieving this goal comes at a considerable cost.

The Malawi Integrated Energy Plan estimates the cost for this endeavour, encompassing both on-grid and off-grid solutions, to be around $3.6 billion.

To this end, the private sector holds an important role in complementing governmental efforts - and my administration is unwavering in its commitment to creating an even more favourable business environment for investors.

A growing power market

Malawi's power demand is set to expand exponentially, with the expected economic and population growth in coming years.

Malawi's Vision 2063, for example, puts focus on the revival of economic sectors with the biggest potential spillovers - commercial agriculture, urbanisation and industrialisation. Underpinning these sectors is the energy component.

Notably, despite the abundant renewable energy potential across Africa, Malawi included, the region's share of renewable energy investments remains minimal.

Out of the $2.8 trillion that went into renewable energy between 2010 and 2020, only two percent came to Africa, according to the International Renewable Energy Agency (IRENA). In 2022, the continent only received 0.8 percent of the $495 billion invested in renewables globally.

Yet, renewable energy investments in Africa actually have a stronger business case than almost anywhere else in the world. According to the World Bank's Global Solar Atlas, a commercial solar installation in Africa could generate 60 percent more energy than a similar-sized plant in central Europe.

The International Energy Agency (IEA) estimates that meeting Africa's stated climate policies would necessitate a cumulative investment of $741 billion between 2022 and 2050, averaging $26 billion annually.

In addressing this, we must reevaluate and prioritise not only power generation but also the transmission network. Over the past decade, an overwhelming 99.5 percent of energy investment in Africa has been directed towards power generation, leaving a mere 0.5 percent for transmission and distribution.

Green minerals

Malawi's rich endowments of minerals needed to supply low-carbon technologies - such as graphite, rare-earth elements, niobium and titanium mineral concentrates - could anchor our country's development goals, while advancing global decarbonisation efforts.

The implementation of "Malawi Vision 2063", powered by renewable, dependable, and affordable energy, is poised to elevate Malawi to an upper middle-income status.

This transformation promises enhanced living and working conditions for our citizens, accompanied by heightened adaptive capacities in the face of a swiftly changing climate.

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Any views expressed in this opinion piece are those of the author and not of Context or the Thomson Reuters Foundation.



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