Market Trends of East Africa Renewable Energy Industry
This section covers the major market trends shaping the East Africa Renewable Energy Market according to our research experts:
Hydropower Segment to Dominate the Market
- The hydropower segment is expected to remain the largest segment in the market as dams have been built across East Africa. Most of the renewable hydro capacity has been constructed in Ethiopia and Mozambique.
- The hydropower Segment includes different-sized reservoir dams that can be used to provide renewable energy. Hydropower is the most used renewable energy in East Africa.
- Hydropower (including mixed plants) constitutes almost 78% of the total renewable energy generated in the region in 2021, around 8,726 MW. It is expected to remain the single largest renewable energy contributing segment in the forecast period.
- The geographical features of the countries in the region aid in the creation of energy from hydropower. Due to the presence of physical structures like the Nile River, Mountains, and the great lakes.
- Therefore, vast reservoirs of dams providing renewable energy are expected to continue to dominate the market due to their large size relative to other renewable energy and an increase in investments.
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Kenya to Dominate the Market Growth
- Kanya is expected to be the fastest-growing renewable energy market in the region during the forecast period, owing to factors like a number of upcoming projects combined with favorable government policies. As of 2021, the country had renewable energy installed capacity of about 2384 MW.
- In July 2022, Kenya's Energy and Petroleum Regulatory Authority (EPRA) released a draft regulation to support introducing a net-metering regime for PV installations. The new rules will apply to PV systems up to 1 MW in size. It will help the country initially deploy around 100 MW of solar capacity.
- In February 2022, the Emerging Africa Infrastructure Fund (EAIF), financed by the governments of the United Kingdom, the Netherlands, Switzerland, and Sweden, provided a USD 35 million, 15-year loan towards the USD 87 million costs of a 40MW solar project planned in Kenya.
- In August 2022, the Kenyan government announced to start of the construction work of a solar photovoltaic power plant in Kisumu. The 40 MWp Kisumu Solar One Park will be built in Kibos on 100 hectares of land donated by the government.
- Hence, Kenya is expected to dominate the market growth due to its significant installed renewable energy capacity increase in the forecast period.
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