Energy & Infrastructure Insight - Issue 2

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REFERENCES 1. Oxford Institute for Energy Studies, Forum, Issue 117, January 2019. 2. International Renewable Energy Association (IRENA) Scaling up renewable energy deployment in Africa Impact of IRENA's engagement, January 2019. 3. Africa50, "Natural gas will make Africa greener", 30 September 2019. 4. Oxford Energy Insight 44, Opportunities for Gas in Sub- Saharan Africa, January 2019. 5. Algeria, Libya, Egypt and Nigeria. 6. Rocky Mountain Institute (RMI) Insight Briefing, Creating a Profitable Balance – Capturing the $110 billion Africa Power Sector Opportunity with Planning, October 2019. 13 FOR MORE INFORMATION PLEASE CONTACT: CONCLUSION If the African Union is to achieve its "Agenda 2063" initiative and transform itself socio-economically over the next 50 years, with the necessary infrastructure in place to support accelerated integration and growth, technological transformation, trade and development, including high-speed railway networks, a well- developed ICT and a digital economy, whist still acting on climate change and ensuring sustainable development, then a stable, reliable, efficient and decarbonized energy system will be needed. Although environmental and market reforms are critical to the development of Sub-Saharan African gas-to power markets, the successful implementation of path-finder projects will provide models for success. These will be possible where there is a demand for energy, a competitively priced project, supported by secure long-term gas supply and appropriate risk allocation. Structuring challenges can be addressed at the project level, which can address specific requirements. This flexibility, combined with the key drivers for gas- to-power, should mean that gas-to-power projects will continue to play an important role in the generation mix. The participation of a motivated state entity, supported by multilateral and private institutions in arranging project debt, with the project equity requirements fully funded by the experienced partners will help deliver successful individual projects but wider systemic reforms in creating the appropriate regulatory frameworks and addressing the currently fragmented, project-focused approach that does not consider whole power system dynamics, including bottlenecks in transmission and distribution will still need to be addressed if gas-to-power projects are to successfully deliver their wider range of benefits (6). IAIN ELDER Partner London T +44 20 7655 5125 iain.elder@ SAMUEL OGUNLAJA Senior Associate Abu Dhabi T +971 2 410 8162 samuel.ogunlaja@

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