Rajiv Ruparelia Writes To Cabinet With Post-Covid19 Economic Recovery Proposes

Uganda, make all countries in the world is pondering on which are best policies it can deploy to recovery from the traumatic coronavirus (COVID19) pandemic. As a government, this a giant job to do; it has to listen to proposes from experienced people including those in the private sector.

In this open letter to the cabinet of Uganda, businessman Rajiv Ruparelia, proposes that legalizing medical marijuana and opening up the externalization of labour business will drive economic recovery and create jobs for Ugandans on top of expanding the tax base. Bellow is the letter.

On January 2nd I turned 31 years of age.

Since I started actively running the Ruparelia Group- conglomerates of 28 companies, I usually use my birthday, which is just about the start of the New Year to reflect on business opportunities for the group in tandem with the opportunities in the country and beyond.

I have lived in Kampala for the greatest part of my adult life and I have seen this city emerge from a mere city of seven hills to now several hills and counting. Contrary to a lot of the negativity you see on social media, the reality on the ground is that Uganda is growing.

Matter of fact, Ugandans today, live longer than they used to Uganda’s life expectancy has grown from 48 years in 1986 to 63.3 years today, thanks to government investments in several healthcare projects such construction of hospitals, immunization Programmes, malaria roll back programmes as well a sexual health projects.  

It is also a fact that Uganda has been growing- at a sustained average of 6% for nearly 20 years. It is also fact that today; Ugandans are healthier and are more educated. Naturally, with healthier and more educated population, the next question becomes jobs. Speaking about jobs creation, I must first applaud government’s investment into creating an enabling climate.

First, as the private sector, we acknowledge the significant investments in creating stable and reliable electricity. Generation has grown from 404.4 MW in 2000 to 1268.9 MW as of October 2020. By mid-2021, this is expected to rise to 1,868.9 MW.

We also recognize government’s investment in roads―the total paved roads network as a percentage of total national roads has more than doubled from 8% (1,000km) in 1986 to 21.1% (5,500km) in 2019. I also do understand, from various government papers that about 18 roads, totaling to 1,375km are currently being tarmacked, while the tarmacking of 17 roads (825.3km) is under procurement and should start by 2022. Twenty-two (22) other roads, totaling up to 2,921.2km are lined up for tarmacking, starting in 2021.  

Uganda Airlines has been revamped and we know that the 1,724km Standard Gauge Railway (SGR), starting with the 273km Malaba-Kampala route as well as the 45km Greater Kampala Metropolitan Area Light Rail Train System (GKMA LRT) are all on course.

We also know about the various reforms and the digitalization happening within various government agencies, such as Lands, Kampala Capital City Authority (KCCA), Uganda Registration Services Bureau (URSB) and Uganda Revenue Authority (URA) that have all contributed to make doing business in Uganda, easier, cheaper and more efficient.

For example, it is now possible to register a business in less than 48 hours and an importer/exporter in Kampala now only needs between 3-4 days to move cargo to and from Mombasa. Previously, this used to take forever.

With these government efforts and several other efforts by the private sector, Uganda is surely a much, much better country than it was, when I was born in 1990.

As night follows day, when you have increased life expectancy, coupled with higher education levels, you should expect that the demand for jobs will grow. And in Uganda where our population growth rates are rather too high, it is more likely the job seekers will outnumber the available jobs- in public, private and civil society jobs.

Now is the time to think out of the box I do appreciate that government, under its “industrialization for jobs policy” has so far put up nine (9) industrial parks and plans a a further 25 industrial parks and four regional science and technology industrial parks.

I also know that there are several initiatives by government to attract FDI into the country and therefore jobs, but given the rate and which the demand for jobs is growing- it is about time we also seriously started thinking outside the box.

This is especially in light of the extra challenges posed by Covid-19 which has disrupted several value chains and depressed local, regional and global demand. Thank God, there is a vaccine in sight. If all goes well, Uganda should start getting its doses towards the end of this half, a much-needed effort in the post-Covid-19 recovery.

Like we have seen in many post-crisis recovery plans, there is always a lot of emphasis and sometimes over-emphasis on business-as-usual. Hardly do policy and decision makers ever consider new ways of doing things. Sooner or later we relapse into our old ways, often prolonging misery and suffering especially in the private sector.

For example, even before Covid-19 there are some sectors that were doing already well, with minimal government investment, except regulation, such as the externalization of Labour. According to the Uganda Association of External Recruitment Agencies (UAERA) there are more than 165,000 Ugandans- growing at an average rate of 5,000 monthly, in the Middle East with annual remittances of more than USD700 million (UGX2.8 trillion.) This is just about 50% of the estimated USD1.4 billion in total remittances by all Ugandans abroad.

The sector also directly employs more than 4,000 Ugandans locally and also pays another UGX25 billion annually to service providers and government agencies for services such as passports, Interpol charges, bank charges, vaccination, COV1D-19 PCR certificate fee etc.

Put together, this sector fetches almost twice more than Uganda’s coffee export earnings. This is before adding other benefits such as the skills, exposure and training brought back by returning workers.  

What if post-Covid-19 recovery policy makers put an effort in enhancing this sector so that Uganda’s earning from workers abroad can match that of Kenya- that according to a recent World Bank report reached USD2.3 billion in 2020 and is expected to reach USD2.9 billion in 2021?

Some other countries like Nigeria expect their remittances to reach USD21.7 Billion in 2020 and Ghana (USD$3.2 billion) and Senegal USD2.3 billion. Another emerging multibillion opportunity- Medical Marijuana is emerging and all signs are that if we don’t move first, we could easily miss out on the first mover advantage.

Last October, Rwanda approved the regulatory guidelines on the cultivation, processing and export of high-value therapeutic medical marijuana. While I do not want to compare Uganda with any other country it is a market reality that most times, the early bird catches the worm- and this time we are talking about a global market that is expected to reach between USD40 billion and USD45 billion by 2025.

Uganda still has a chance to move fast and make the necessary regulatory approvals. I wish to reiterate that if there is anything, I have learnt from Covid-19, then it is the danger of relying on the same sets of traditional sources of income.

Uganda is ready for take-off and the next game-changer will be how fast we can create more jobs than the available demand and truth be said, not all of those jobs will be resident here in Uganda.

 

Rajiv Ruparelia is the Managing Director of Ruparelia Group of companies

Uganda’s Energy & Climate Crisis Can Be Addressed Through NDCs Implementation

By Patrick Edema    

In 2015, up to 197countries including Uganda signed the Paris Agreement, an international climate accord to strengthen global response to the threat of climate change. Various countries which were parties to the agreement agreed to work towards keeping global temperatures below 2 degrees Celsius, above pre-industrial levels.

In line with this global commitment, Uganda submitted its Nationally Determined Contribution (NDC) to the United Nations Framework Convention on Climate Change (UNFCCC) in 2015. Through this NDC, the country hopes to reduce emissions from its business-as-usual scenarios by 22% by 2030 via a series of policies and measures to mitigate and adapt to climate change.

This was estimated to cost approximately USD 7.80 billion (World Bank, 2016). The mitigation efforts focused on forestry and wetlands, energy, transport, infrastructure, water and agriculture sectors. The business-as-usual scenario estimates an output of 77.3 million tonnes of carbon dioxide equivalent per year (MtCO2eq/yr) by 2030.

The country hopes that the NDCs will catalyze investment towards realizing Uganda’s commitment for 22% greenhouse gas (GHG) emissions reduction by 2030.

The Government of Uganda then developed a climate change policy (2015) geared towards addressing the consequences of climate change and their causes through appropriate measures while promoting sustainable development and a green economy. The country is currently formulating the Ugandan Climate Change Law, which is expected to govern climate change policy and regulate the implementation of Uganda’s mitigation and adaptation strategies.

The Paris Agreement under article 4 calls on Parties to deliver their new Nationally Determined Contributions (NDCs) every five years that are informed by the best available science, latest advances in technology, and economic trends.

This year, 2020, countries will officially submit their domestic climate action plan for the next 5-10 years where Uganda will also submit its revised NDCs. The country’s priority areas include strengthening government institutions to support NDC implementation through capacity development, providing support in devising bankable project proposals, developing and implementing a robust Monitoring, Reporting and Verification framework and greenhouse gas inventory systems, and identifying financing for NDC implementation.

Throughout the planning process, various stakeholders were brought together including government experts from relevant ministries and authorities, private-sector actors and other development partners.

Despite Uganda’s contribution to emission reduction is multidimensional, through tree planting, afforestation and reafforestation programmes, and all these contributing to emission reduction through carbon sequestration, and other benefits, such as biodiversity conservation, as reflected in goal 15 of the United Nations Sustainable Development Goals, it is absurd that the natural resources that would contribute as mitigation measures to reduce greenhouse gas emissions are degraded and depleted.

For instance, it is estimated that the oil and gas sector worth US$ 2billion earnings for the country annually is projected to produce more greenhouse gas emission in the atmosphere than any other projects. The East African Crude Oil Pipeline (EACOP) oil project alone is expected to produce over 34.3million metric tons of CO2-equivalent (CO2e) per year, Tilenga oil project is projected to produce 45million metric tons of CO2e while the Kingfisher oil project is projected to produce over 32million metric tons of CO2e per year.

Furthermore, majority of the Uganda’s population have opted to using unsustainable and polluting energy sources which are large contributors to gas emissions due to high power expenses that are not affordable to vulnerable groups including women, elderly, disabled among others.                                                                                                                    

Although Uganda’s Intended Nationally Determined Contribution opens the door to affordable and modern energy as inscribed in goal seven of the United Nations Sustainable Development Goals (UNSDGs), it is clear that since 1960, the mean annual temperatures have risen by 1.3oC and annual and seasonal rainfall has decreased significantly across country.

Yet the government continues to invest billions of money single source of energy (hydropower) and fossil fuels that will increase the impacts of climate change even when Uganda is endowed with abundance of sunshine that can generate solar energy throughout the year.

It should be clear that Uganda’s commitment to reduce greenhouse gas emissions (GHG) by 22% by 2030 and contribute to global targets under the Paris Agreement requires more efforts that have to be undertaken.

These include expedition of Climate Change Bill 2020 into law to facilitate the implementation of the country’s climate change policy and the National Determined Contributions, reducing the power tariffs that cannot be afforded by the majority, investing in solar energy as well as leaving oil and gas resources underground.

Further, the capacity of district local governments to integrate and implement climate change actions in all relevant departments should be strengthened focusing on training, public awareness, resource mobilization and knowledge management systems.

More to that, there is need to align the NDC to the country’s National and district development plans and budgets to ensure that they are implemented. The government through the National Planning Authority (NPA) is already helping the integration of climate action within the Draft National Development Plan III and the country’s Green Growth Strategy has been developed. This should be capitalized on to enhance NDC implementation across the sectors spelt out within the National Development Plan III.

Finally, implementing climate change actions requires applying multi-level governance approaches and therefore integration and coordination of state and non-state actors is critical. This will require establishment of an NDC sectoral coordination Committee to oversee performance of implementation.

National and District Local Government Policies, strategies, plans and budgets need to be reconciled to ensure that there is a shared purpose in climate change actions and development priorities. The alignment of priorities, plans, budgets and activities across governance levels with a purpose of implementing the NDC is crucial.

Patrick Edema, Environmental Engineer at Africa Institute for Energy Governance  

    

Be Mindful Of Our Environment As We Decide Our Leaders

By Aryampa Brighton

Uganda has a vibrant landscape blessed with a green environment and abundance of natural resources. 0ver time, this environment has been encroached by human activities inform of industrialization, agriculture, brick making among so many others. Protected forests of Bugoma central forest reserve and Zoka forest have been the current notable examples being threatened during this pandemic. More environments are at risk of being degraded in this election period or if we don’t take action to protect it.

It is a well-known global fact that Uganda is now close to national elections due January 2021.  So far the election campaigns have been trailing with a firestorm of protests in the country. The protests have been characterized by burning of tyres, polythene, poles among so other toxic materials. And of course, the police, army and other security organs have retaliated to the protests with teargas, live bullets. Posters, polythene papers, plastic bottles among others are being loitered everywhere during campaigns. These events are raising significant health and safety concerns not only for those protesting but for the environment. As a country, we are facing air and water pollution, deforestation, swamp encroachment and other environmental issues now. They are a danger to our environment, ecosystems, biodiversity and most importantly our lives.

Therefore it is critical to protect the environment so as to reduce the destruction of ecosystems caused by these myriads of avoidable human activities. I believe it should be a moral obligation for every Ugandan to protect the environment from such degradation because every time an environment is degraded it threatens the long term health of Ugandans, animals and plants. This puts our ecosystem, biodiversity and humanity at great risk of distinction. Therefore it should be every Ugandan responsibility to take care of the environment to make this country and planet a wonderful place to live. We don’t need to put a lot of money to go green but rather simple changes in daily lifestyle is all that is required to keep the environment conserved for the present and future generations. All we need is to think clean and biodegradable, to resist so much from buying plastics and dumping them, plant one tree and then another, encourage recycling.

Take this election period to create an environmentally friendly country, protest peacefully if you must but desist from using materials that will harm our environment.  Exercise your right of voting under article 59 of the constitution by voting accountable and transparent leaders that will engage every Ugandan and put policies that create an environment that we all desire, leaders that will respect the vibrant environmental policies that we have as a country. This will be achieved if you put questions to the aspirant leaders on policies they intend to establish so as to protect the threatened environment and ensure clean air and energy. A Clean and healthy environment is one of the essential rights of a welfare state as stipulated under article 39 of the constitution of Uganda, therefore I urge the government to ensure that their agencies work harder to ensure the same, let’s not normalize the use of teargas and as chemical sprays to disperse peaceful protesters. We can probably use water or any other environmental friendly sprays. As a country, we should always remember that a healthy environment, healthy communities and a healthy economy go hand in.

Aryampa Brighton, Youth For Green Communities

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What Happens To African Energy Industry If Western Lenders Cut Off Loans For Fossil Fuel Projects?

By NJ Ayuk

A little more than a year ago, in November 2019, the European Investment Bank (EIB) declared its intention to phase out funding for fossil fuels. Specifically, it said that it would no longer grant loans for projects involving crude oil, natural gas, and coal as of January 1, 2022 (with a scant few exceptions for gas projects that meet rigorous environmental criteria).

In making this announcement, the EIB made history. It became the first major multi-lateral financial institution to make a public commitment to abandon fossil fuels in the name of combatting climate change.

Its pledge did not go unnoticed. In October 2020, Antonio Guterres, the secretary-general of the United Nations (UN), called on the world’s publicly funded development banks to follow suit. Less than a month later, all 450 of these institutions — including, incidentally, the African Development Bank Group (AfDB) — agreed to bring their lending policies into line with the Paris climate accord.

The agreement did not include a categorical ban on fossil fuel loans, since some of the lenders involved, such as the Asian Development Bank (ADB), were unwilling to make this commitment. However, a group of European lenders did exactly that — and they were hardly alone in doing so.

You see, public development banks aren’t the only institutions to have made climate commitments. Since the beginning of 2020, a number of major private lenders — including but not limited to giants such as Barclays, HSBC, and Morgan Stanley — have rolled out plans to reach net-zero in greenhouse gas (GHG) emissions by 2050.

Others — such as Blackrock, a major asset management firm — have pledged to make more money available for renewable energy projects. And just a few weeks ago, South Africa’s Standard Bank Group joined the chorus, saying it would no longer fund fossil fuel projects unless the sponsors could demonstrate compliance with strict environmental standards.

And it’s not just the banks. Climate considerations are now driving some of the world’s largest oil and gas firms, with multi-national giants such as BP and Royal Dutch/Shell and slightly smaller operators such as Occidental Petroleum, aiming to hit the net-zero mark by 2050. They may also come to drive the U.S. government’s policies, as President Joe Biden has declared climate change one of the first priorities of his administration.

Is This a Tipping Point?

So what next? Should I follow the Bloomberg news agency’s example and talk about 2020 as a tipping point for climate activism? Should I try to extend the story I outlined above into the future and paint this year as the beginning of the end for fossil fuels?

That’s not what I want to do.

That’s not what I want to happen.

Instead, I’ll try to explain why I think the move away from financing fossil fuel projects has the potential to hurt Africa. And I’m going to do it by imagining what might happen if this move continues.

What Happens If Climate Concerns Dominate?

In this scenario, climate concerns come to dictate the lending policies of Western financial institutions. By 2025, all of the world’s publicly funded development banks have joined the EIB in declining to fund fossil fuel projects (even though a select few organizations are still managing to attract small-scale creditors after agreeing to adopt onerous and costly carbon offset arrangements). Private lenders have followed suit, making it known that they will only support renewable energy schemes (and that they prefer to do business with companies and governments that fall in line with their own net-zero pledges).

As far as the leaders of these financial institutions are concerned, they’ve done the right thing. They’ve done their part to uphold the Paris agreement and prevent the disasters caused by climate change. They’ve responded to the concerns of the public (and of their shareholders). And aren’t fossil fuels a risky investment nowadays? After all, demand never quite recovered after the COVID-19 pandemic hit, and prices have stayed rather low. Oil and gas are quite out of fashion now, really!

The View from Africa

But the view from Africa is likely to be different.

In Africa, climate considerations and ideological commitments to eliminating GHG emissions may well take a back seat to more urgent questions about how to encourage economic growth and supply basic necessities to the continent’s growing population.

In countries with large natural gas reserves such as Mozambique, Tanzania, South Africa, Nigeria, Algeria, Equatorial Guinea, Ghana, Cameroon, Senegal, and many others, politicians, businessmen and everyday people should ask their western counterparts why they should decline to extract a resource that could be used to produce electricity cheaply and reliably for both households and businesses.

They should ask why they should forego the opportunity to develop an industry that creates jobs, both directly and indirectly, and promotes trade with neighboring states that also need energy. They should ask why they are being discouraged from using the least polluting of the fossil fuels and pushed towards renewable energy solutions that are less reliable and more expensive per unit of power generated.

They should ask why Africa should be punished for western nations GHG emissions. They should ask what happens to energy poverty. They should ask who will pay reparations to Africa if Africans have to abandon their natural resources.

They may also ask why they should make the same sacrifices as Western countries when they don’t have the same advantages as those countries — including, say, the complement of legacy, gas-fired power plants needed to ensure that electricity supplies continue all day and night, without interruption, even at times when the wind isn’t blowing, and the sun isn’t shining.

Africans should also question the need to leave crude oil in the ground – and they should! For many of them, their oil industry and service companies are a major source of income. And while they may be willing to see that source phased out gradually, they’re not likely to assent to plans for killing them off abruptly.

Also, what about independent African exploration and production companies? What about African oilfield service companies and midstream operators? Shouldn’t they have a say in their future too?

Meanwhile, what about all the time and resources that a number of African leaders have invested in creating policies that encourage international oil companies to invest in their countries, from improved fiscal regimes to transparency laws to win-win local content policies? There’s no question that these leaders were interested in oil revenue, but there is so much more to gain from these policies, from much-needed technology transfers to business and growth opportunities for local entrepreneurs. In the wake of the COVID-19 pandemic, African economies need these opportunities more than ever.

Leaving China As the Only Option

Amidst all these questions, there may be a few determined types who seek to push forward with upstream oil and gas development despite the lack of support from Western banks. Heads of state may try to subsidize gas projects (or provide other forms of support) in an attempt to build up domestic capacities and promote self-sufficiency in energy. Entrepreneurs may reach into their own pockets or work to drum up local support, in the hope of using abundant natural resources to turn out products for which there is demand.

Without access to Western capital, such initiatives are more likely to fail — or, at least, to falter. If so, their backers may very well look for support elsewhere. And they may find it in China, which has been very willing to provide financial and technical assistance for fossil fuel projects in Africa.

Personally, I find the prospect of Beijing becoming the main source of outside financing for African oil, gas, and gas-to-power projects to be concerning. I’m not saying this because I think African states ought to shy away from cooperation with China. I’m saying it because I want them to have as many options as possible. I want them to be ready to work with a wide range of partners, rather than fall into a pattern of not having to look further than satisfying China’s requirements.

And this won’t happen if Western lenders cut off funding for African oil and gas projects as a consequence of their commitment to curbing climate change.

Instead, China will come to have more influence than any other party over the African oil and gas sector. China, which has already put a number of African countries in the position of handing over important assets when they find themselves unable to keep up with loan payments. China, which has a less-than-stellar track record on environmental protection, despite being a signatory to the Paris climate accord.

Time to Make a Case for Oil and Gas

As I’ve already said, this is not the outcome I want.

Instead, I think Africa should have the chance to use its own oil and gas to strengthen itself especially with the coming into force of the Africa Continental Free Trade Agreement.

I also think Africa should have more than one option when it comes to financing petroleum projects.

Most of all, I think Africa should have the chance to make its own choices without undue pressure from Western institutions that don’t face the same challenges. Africans have to become more visible, more vocal and even more hopeful about the future and the energy sector.

As a result, I think African states ought to push back against the idea that it’s time for Western banks to stop all funding for fossil fuels. I think that African oil and gas producers ought to stand up for themselves and make a case for developing their own resources — particularly for using the least-polluting fossil fuels to deliver as much electricity as possible to as many people as possible.

And the time to make that case is now, while financing for oil and gas is still available.

Urgent Action Needed For Energy Transition In Heating & Cooling

The transition to cleaner, more sustainable heating and cooling solutions can attract investment, create millions of new jobs and help to drive a durable economic recovery in the wake of the global COVID-19 crisis, says a new study by leading energy organisations. 

The joint report by the International Renewable Energy Agency (IRENA), the International Energy Agency (IEA) and the Renewable Energy Network for the 21st Century (REN21), highlights the benefits, identifies investment barriers, as well as the policies to drive faster uptake of renewable heating and cooling worldwide. Renewable Energy Policies in a Time of Transition: Heating and Cooling describes five possible transformation pathways, encompassing renewables-based electrification, renewable gases, sustainable biomass, and direct uses of solar thermal and geothermal heat.

"Energy efficient heating and cooling based on renewable sources has emerged as an urgent priority for countries striving to meet climate commitments under the Paris Agreement and to build resilient, sustainable economies," said IRENA Director-General, Francesco La Camera

"The transition to cleaner, more efficient and sustainable heating and cooling solutions can attract investments, create millions of new jobs and help to drive a durable economic recovery in the wake of the global COVID-19 crisis. It will make much needed heating and cooling services available to everyone, including to remote islands and least-developed countries of Africa and Asia."

Heating and cooling demand accounts for around half of global final energy consumption, mostly for industrial processes, followed by residential and agricultural applications. Most of this energy now comes either from fossil fuels or inefficient, unsustainable uses of biomass. Heating and cooling, consequently, is a major source of air pollution and accounts for over 40 per cent of global energy-related carbon dioxide (CO2) emissions. At the same time, around 2.8 billion people currently rely on wood fuel, charcoal, animal dung and other inefficient and polluting fuels for cooking.   

The demand for heating and cooling is set to keep growing. Cooling demand has already tripled globally since 1990, and as climate change increases the number and severity of heat waves, so does the urgency for supplying air conditioning and refrigeration to billions of people.

Policy makers have so far given limited attention to the heating and cooling transition. By the end of 2019, only 49 countries--mostly within the European Union--had national targets for renewable heating and cooling, in contrast with 166 having targets for renewable power generation. To decarbonise the energy used for heating and cooling, aggressive and comprehensive policy packages that phase out the use of fossil fuels and prioritise renewable energy and efficiency are even more urgent amid the COVID-19 pandemic, which has cut demand for renewables-based heating and cooling services, including in households and small businesses. The health and economic crisis has also worsened conditions for energy access in many developing countries.

Transitioning to renewable sources will help to increase access to clean, affordable and reliable heating and cooling services, even on remote islands and in some of the least-developed countries of Africa and Asia. At the same time, renewable heating and cooling can create new jobs, stimulate local economies, and improve people's livelihoods, while strengthening countries' energy security and independence, the report notes. 

Don't Underestimate The Power Of Natural Gas To Transform Africa

By NJ Ayuk

Africa has already made an indelible mark in the oil industry. It is home to four of the world's top 20 crude oil producers — Nigeria, Angola, Algeria, and Libya — and these same four countries also have some of the largest oil reserves in the world.

So far, it hasn't made quite as much of a splash in the gas industry. The only African countries on the list of the world's top 20 gas producers are Algeria and Nigeria, and one of the states that has the largest gas reserves is Mozambique, which is still several years away from bringing its major fields on line.

But the gap between African oil and gas doesn't have to be permanent. The continent's gas industry is on the verge of real transformation, as the African Energy Chamber (AEC) notes in our 2021 Africa Energy Outlook, released earlier this month. I'd like to describe what forms that shift might take — and explain how the changes would benefit Africans.

New Sources of Production

Some of the change I expect is going to happen in the upstream sector — that is, in the realm of exploration and production.

First, the continent's current leading producers are likely to produce more. North African states such as Egypt and Algeria will account for part of this increase, as they are looking to ramp up development at existing natural gas fields. But another part of it will stem from programs designed to reduce the flaring of associated gas found in oil fields.

Both Nigeria and Angola, for example, have plans to expand the use of associated gas. The former aims to deliver its production to the domestic market, while the latter is looking to split its production between the local market and the export-oriented Angola LNG project.

The upshot of these trends is that the list of Africa's top gas producers will probably remain static until the middle of the decade. As the AEC's outlook explains: "The (continent's) top five crude oil producers — Nigeria and Angola from the west, and Algeria, Egypt, and Libya from North Africa — complete the top five natural gas producers for 2020 and 2021.

These five countries contribute about 90% of the overall natural gas output from the continent for both (2020 and 2021), and the expected forecast suggests the share of these countries will remain the same going into the mid-2020s."

At that point, though, new producers will start to play a more prominent role. Mozambique is due to launch its first greenfield project at Area 1 in 2024, and its offshore zone may become a major source of natural gas by 2025-2026.

The Mauritania-Senegal offshore zone may follow a similar timeline, as the Greater Tortue/Ahmeyim blocks may begin yielding natural gas in 2023, followed later by the Yakaar-Teranga and BirAllah projects. What's more, all four of the projects mentioned in this paragraph will support gas liquefaction plants capable of producing and exporting LNG.

By the end of the decade, then, there will be more than five countries accounting for the bulk of Africa's total gas production. Nigeria, Angola, Algeria, Egypt, and Libya will be joined by at least three others —Mozambique, Mauritania, and Senegal.

Domestic Consumption vs. Exports

Meanwhile, consumption patterns are going to shift along with production patterns. Once again, this shift is likely to begin once the large new fields in the Mozambique and Mauritania/Senegal provinces come online.

The change may not be obvious on a macro level, because it won't be evident in the split between exports and domestic consumption. That is, Africa will continue to use about 70% of the gas it extracts and will export continue to the remaining 30%. As the AEC's outlook explains, though, the geography of African gas exports will not remain static.

"The pattern has been relatively stable since 2012 with about 70% serving local markets, 20% exported to Europe and 10% exported to Asia," the report states. "The mid-2020s LNG startups are also expected to distort this picture by increasing the market share for East Asia LNG exports.

This development is, however, not (a consequence) of local markets' (rising demand), but rather the shrinking ability of North African countries to maintain their export capacity to Europe on the back of strong domestic demand growth. By 2030, the expectation is effectively for East Asia and Europe to be inverted, while domestic market share remains constant."

In short, Africa is on track to produce more gas by the end of the decade but will keep the same share of the total for its own use. At the same time, Asia will replace Europe as the most important market for African gas exports.

Gas Means Jobs

These trends are interesting, but you may want to ask: What do they mean for ordinary Africans, for people who are less concerned with production data and trade balances than with questions about how to support their families?

They mean a great deal.

As I've mentioned, the 2021 Africa Energy Outlook report projects that African gas production is going to rise, especially after new fields come on line and ramp up development in the middle of the decade. It also anticipates that African gas consumption will rise, even if domestic consumption continues to absorb a full 70% of total production.

As production goes up, upstream operators will create jobs. They will need people to help them build, operate, maintain, and repair production, transportation, and processing facilities. They will also need people to administer their local operations. Additionally, they will need to meet legal requirements or contractual commitments for local content, so they will need to hire African contractors. Those African contractors, in turn, will need employees of all kinds, and so will hire African workers.

And as consumption goes up, even more jobs will be created. Distributors will need new pipelines to deliver the gas to end-users, so they will need people who can help them build, operate, maintain, repair, and administer those pipelines, along with associated infrastructure facilities such as storage depots.

And even in the absence of pipelines, they will need to acquire tankers and containers so that they can bring gas to customers by road, rail, or river. Accordingly, they will need people to procure, operate, maintain, repair, and administer these operations.

Meanwhile, there's more. The hiring of more African workers is sure to have knock-on effects. If, for example, employees of upstream operators need a way to get to a remote worksite, local transportation companies may be able to serve them. If so, those transportation companies may have to hire more people to drive their vehicles.

Likewise, if African construction firms need to procure extra building materials to uphold their contracts with upstream operators, local suppliers may be able to meet their needs. And if so, those local suppliers may have to hire more people to handle their inventory.

In other words, as Africa's gas industry grows, it has the potential to create thousands and thousands of jobs! Of course, some of them, such as construction jobs, will be temporary. Some of them will be more permanent, though, especially if the governments of gas-producing states work with upstream operators to develop local hiring and training standards that expand the capacity of the local workforce.

All the Way Down the Value Chain

But the knock-on effect doesn't have to stop there.

In my most recent book, Billions at Play: The Future of African Energy and Doing Deals, I urged African oil and gas producers to look as far down the value chain as they could. I advised them to pursue projects that treated hydrocarbons not just as exportable raw materials but as inputs for value-added operations such as fertilizer or petrochemical manufacturing. I also suggested that they look for ways to focus on gas-to-power projects with the intent of improving domestic electricity supplies — and not just because new power grids would benefit African businesses.

It is true, of course, that some African businesses will be able to create more jobs if they do not have to worry about blackouts. Likewise, it is true that gas-to-power projects will create jobs of their own in areas such as construction, operations, maintenance, and administration. But it is also true that African households need and deserve access to reliable energy supplies, regardless of employment levels — and that gas-to-power plans can help them!

I'm hardly the only person to reach this conclusion. When I wrote Billions at Play, several African countries had already rolled out ambitious gas-to-power schemes. Nigeria, for example, was in the process of implementing a program that promoted associated gas as fuel for new power plants. Since then, others have followed suit. For instance, as the AEC's energy outlook notes, Senegal has unveiled plans for using its future gas production to generate electricity for the domestic market. Mozambique already has a couple of gas-to-power projects in the works, too.

But it shouldn't stop there. I'd like to see more gas producers do this as they ramp up gas production in the second half of the decade. If they do, they will have accomplished something beyond merely increasing output levels. They will have taken concrete action to strengthen their economies and benefit their own citizens. And in so doing, they will have made their mark on the world!

NJ Ayuk is Executive Chairman of the African Energy Chamber, CEO of Centurion Law Group, and the author of several books about the oil and gas industry in Africa, including Billions at Play: The Future of African Energy and Doing Deals.

African Countries Must Take A Balanced Approach To The Energy Transition

Africa stands at a precarious juncture, where the transition from fossil fuels to renewables intersects with the economic benefits of a strategically managed oil and gas industry. 

Down one road, the continent expands exploration and production of its vast natural gas and oil reserves to bring electricity, fuel, and financial power to millions. Down the other, it yields to pressure to help achieve climate targets, including outright bans on fossil fuels that would eliminate funding for natural gas projects.

Is it possible to put one foot on each path? Absolutely. Doing what’s best for Africa and what’s right for the environment do not have to be mutually exclusive. Some form of balance is always possible.

On a continent where millions of families are using traditional, hazardous biomass for cooking, where 600 million people lack access to reliable electricity, the idea of leaving valuable oil and, especially, natural gas, in the ground seems neither practical, palatable, nor appropriate. In fact, as the African Energy Chamber’s newly released African Energy Outlook 2021 says, beyond the calamity created by COVID-19, in the short-term, the drive to curb carbon emissions is one of the conventional oil and gas industry’s biggest challenges — and one of Africa’s, too.

Curbing emissions is a noble and essential goal. The problems associated with climate change aren’t something we can look on from afar and let someone else worry about. After all, Africa is considered more vulnerable to the effects of climate change than many other areas, especially since so much of the population depends on regular rainfall to grow food crops.

With a warming planet bringing drought and dust storms to one part of the continent and floods to another, affecting quality of life and livelihoods, we know first-hand how important climate justice is. We also understand that it’s our responsibility as global citizens to participate in energy transition. 

Within reason, that is.

Energy transition, the so-called path from fossil-based to zero carbon, cannot be applied with a broad brush. What will work in Norway isn’t always feasible in Namibia. What makes for sensible policy in London isn’t necessarily pragmatic in Lagos.

For one thing, Africa uses so little energy now, our emissions from oil and natural gas are minimal. In fact, the World Economic Forum estimates that if all of sub-Saharan Africa tripled its electricity consumption overnight using only natural gas, the additional CO­2 would be equivalent to just 1% of global emissions.

Admittedly, as rising incomes and population growth propel energy demand in Africa — we have the fastest growing population in the world, as well as the youngest — greenhouse gas emissions are likely to increase as well. That is, unless we follow an intelligent, modern energy plan that incorporates renewables along with natural gas. There’s room for both, as well as need: While solar power and wind can help provide electricity to fill the current and impending power void, neither can furnish feedstocks for industry, gasoline for transportation, or process heat for manufacturing.

Solar Power Has Great Potential

Harnessing a renewable resource for electricity is something African has history with. We’ve been using hydropower for decades. It makes sense, then, that we can transfer our experience to the adoption of solar power.

In fact, when it comes to solar power the future, pardon the pun, seems bright. Africa has already made considerable progress using solar photovoltaics (PV) to capture and convert abundant sunlight to ample energy. South Africa, for example, has eight of the 10 largest solar plants in Africa; the continent’s largest is in Morocco. At the same time, we’ve also seen advances in bringing off-grid, home-scale solar systems to rural villages in sub-Saharan Africa.

The International Renewable Energy Agency (IRENA) suggested that, with the right policies in place, by 2030 Africa should be able to generate more than 70 gigawatts (GW) of solar PV capacity. Considering 1 GW could realistically power 300,000 American homes, that’s a significant figure.

But is it enough?

According to the International Energy Agency (IEA), demand in Africa today is 700 terawatt-hours (TWh), with the vast majority — more than 70% — of the total derived from North African economies and South Africa. But the IEA predicted that by 2040, the fastest demand growth will come from sub-Saharan nations.

Can solar scale up to meet accelerated needs in time? Without natural gas in the energy mix — especially without the gas-to-power initiatives that are part of the 2030 Roadmap — will people remain in the dark?

And what can be done to take natural gas off the banned fossil fuels list?

We Must Curb Wasteful Gas Flaring

The biggest concern about the continued use of natural gas comes down to one word: Flaring.  

Flaring is the practice of routinely burning off associated natural gas that is produced from the reservoir during oil production. Flaring is often done for technical, safety, or regulatory reasons, but there’s no denying that routine flaring, which happens when the economics don’t support using the natural gas, is a waste of a precious resource.

And even though nearly all — 99% — of natural gas is combusted when flaring is done under the right circumstances, when there are problems with the flame or other operating conditions, flaring can create a significant environmental problem. Estimates from satellite data put the amount of COreleased into the air by flaring at 300,000 tons per year. And, unfortunately, that figure is on the rise: Between 2018 and 2019, the total increased by 3%.

It’s worth noting, however, that most of the increase during that period came from three countries: the United States, Venezuela, and Russia. Specifically, emissions during gas flaring rose 23% in the United States alone. Venezuela’s total increased by 16% and Russia was up by 9%. If you include Iran along with the other three, just four countries were responsible for 45% of all global gas flared between 2017 and 2019.

By contrast, in the rest of the oil-producing world, gas flaring has declined, down approximately 10% between 2012 and the first quarter of 2020.

That includes Nigeria, where flaring has dropped 70% over the last two decades, and Angola, where reducing flaring is part of a program to capture natural gas and convert it to liquefied natural gas (LNG) for export. State-owned Sonangol has partnered with four oil and gas majors, Chevron, BP, Eni, and Total, to develop a $12 billion offshore project to produce 5.2 million tonnes of LNG per year.

It’s heartening to know that five African countries - Algeria, Cameroon, Republic of Congo, Gabon, and Nigeria - are among the nations, companies, and organizations that have joined in The World Bank’s Global Gas Flaring Reduction Partnership (GGFR). This forward-thinking group is dedicated to identifying and overcoming the barriers to flaring reduction on a country-by-country basis. Through research, sharing best practices, and advancing flare measurements and reporting, GGFR is equipping the world to live with natural gas, the fossil fuel with the lowest carbon footprint, rather than try to live without it.

We Can Find a Balance

Like GGFR, the African Energy Chamber also seeks to balance what on the surface may seem like competing interests. While their mission is to make plentiful natural gas even cleaner so it remains a viable alternative in tomorrow’s modern energy mix, we would like to see a diversified energy industry in Africa where people and local businesses benefit from both fossil fuel activities and clean energy production.

We have only to look as far as Kenya to find a pertinent example.

The nation, which is home to east Africa’s largest solar generation plant, derives 93% of its electricity from renewables. Along with wind and hydropower, solar is responsible for increasing the proportion of the population who have access to electricity from 63% in 2017 to 75% today — a nearly 20% increase in just three years. As renewables become increasingly affordable, it is likely that wind and solar development will continue, although for now, it’s tough to find investors and financing to bring new projects online.

Economics are also at the heart of Kenya’s new oil and gas developments, and in a positive way. With the discovery of the massive Turkana fields in the nation’s north-western region, Kenya has an opportunity, albeit one that may be years away, to grow its oil and gas service sector, continue its new role as an oil exporter, and further diversify its economy. Legislation regulating oil exploration and production and outlining revenue-sharing will help local communities as much as they protect the government and companies.

This Isn’t The Time to Leave Resources Stranded

As the Chamber has stated, we are all for a diversified energy mix and are looking forward to seeing cleaner energy developments surface across the continent. Currently, however, solar and wind projects rely on global value chains, which limits their ability to support local jobs, business opportunities, and capacity building.

Until this can be resolved, the renewable energy industry simply cannot offer Africa the same value as a strategic approach to our oil and gas industry. Natural gas production is particularly important, not only because of the role it can play in alleviating energy poverty, but also because of its potential to be monetized, to facilitate infrastructure development, and to foster the creation and strengthening of other sectors. And that, in turn, can lead to even more jobs, business opportunities, and economic growth for African communities.

Africa needs natural gas to light the way in both a literal and figurative sense. Our future is at stake, and we need to make our voices heard: We can curb emissions without cutting off a pathway to economic growth for the 20 African nations that have natural gas reserves. We can embrace clean energy without missing out on a critical means of giving more African households and businesses access to electricity. That’s a message we can’t let others drown out. The road to energy transition might be bumpy for all of us, but the idea of banning all fossil fuels makes it exceptionally treacherous, if not impassable, for Africa.

NJ Ayuk is Executive Chairman of the African Energy Chamber, CEO of Centurion Law Group, and the author of several books about the oil and gas industry in Africa, including Billions at Play: The Future of African Energy and Doing Deals.

Don't Underestimate The Power Of Natural Gas To Transform Africa

By NJ Ayuk

Africa has already made an indelible mark in the oil industry. It is home to four of the world's top 20 crude oil producers — Nigeria, Angola, Algeria, and Libya — and these same four countries also have some of the largest oil reserves in the world.

So far, it hasn't made quite as much of a splash in the gas industry. The only African countries on the list of the world's top 20 gas producers are Algeria and Nigeria, and one of the states that has the largest gas reserves is Mozambique, which is still several years away from bringing its major fields on line.

But the gap between African oil and gas doesn't have to be permanent. The continent's gas industry is on the verge of real transformation, as the African Energy Chamber (AEC) notes in our 2021 Africa Energy Outlook, released earlier this month. I'd like to describe what forms that shift might take — and explain how the changes would benefit Africans.

New Sources of Production

Some of the change I expect is going to happen in the upstream sector — that is, in the realm of exploration and production.

First, the continent's current leading producers are likely to produce more. North African states such as Egypt and Algeria will account for part of this increase, as they are looking to ramp up development at existing natural gas fields. But another part of it will stem from programs designed to reduce the flaring of associated gas found in oil fields.

Both Nigeria and Angola, for example, have plans to expand the use of associated gas. The former aims to deliver its production to the domestic market, while the latter is looking to split its production between the local market and the export-oriented Angola LNG project.

The upshot of these trends is that the list of Africa's top gas producers will probably remain static until the middle of the decade. As the AEC's outlook explains: "The (continent's) top five crude oil producers — Nigeria and Angola from the west, and Algeria, Egypt, and Libya from North Africa — complete the top five natural gas producers for 2020 and 2021.

These five countries contribute about 90% of the overall natural gas output from the continent for both (2020 and 2021), and the expected forecast suggests the share of these countries will remain the same going into the mid-2020s."

At that point, though, new producers will start to play a more prominent role. Mozambique is due to launch its first greenfield project at Area 1 in 2024, and its offshore zone may become a major source of natural gas by 2025-2026. The Mauritania-Senegal offshore zone may follow a similar timeline, as the Greater Tortue/Ahmeyim blocks may begin yielding natural gas in 2023, followed later by the Yakaar-Teranga and BirAllah projects. What's more, all four of the projects mentioned in this paragraph will support gas liquefaction plants capable of producing and exporting LNG.

By the end of the decade, then, there will be more than five countries accounting for the bulk of Africa's total gas production. Nigeria, Angola, Algeria, Egypt, and Libya will be joined by at least three others —Mozambique, Mauritania, and Senegal.

Domestic Consumption vs. Exports

Meanwhile, consumption patterns are going to shift along with production patterns. Once again, this shift is likely to begin once the large new fields in the Mozambique and Mauritania/Senegal provinces come online.

The change may not be obvious on a macro level, because it won't be evident in the split between exports and domestic consumption. That is, Africa will continue to use about 70% of the gas it extracts and will export continue to the remaining 30%. As the AEC's outlook explains, though, the geography of African gas exports will not remain static.

"The pattern has been relatively stable since 2012 with about 70% serving local markets, 20% exported to Europe and 10% exported to Asia," the report states. "The mid-2020s LNG startups are also expected to distort this picture by increasing the market share for East Asia LNG exports.

This development is, however, not (a consequence) of local markets' (rising demand), but rather the shrinking ability of North African countries to maintain their export capacity to Europe on the back of strong domestic demand growth. By 2030, the expectation is effectively for East Asia and Europe to be inverted, while domestic market share remains constant."

In short, Africa is on track to produce more gas by the end of the decade but will keep the same share of the total for its own use. At the same time, Asia will replace Europe as the most important market for African gas exports.

Gas Means Jobs

These trends are interesting, but you may want to ask: What do they mean for ordinary Africans, for people who are less concerned with production data and trade balances than with questions about how to support their families?

They mean a great deal.

As I've mentioned, the 2021 Africa Energy Outlook report projects that African gas production is going to rise, especially after new fields come on line and ramp up development in the middle of the decade. It also anticipates that African gas consumption will rise, even if domestic consumption continues to absorb a full 70% of total production.

As production goes up, upstream operators will create jobs. They will need people to help them build, operate, maintain, and repair production, transportation, and processing facilities. They will also need people to administer their local operations. Additionally, they will need to meet legal requirements or contractual commitments for local content, so they will need to hire African contractors. Those African contractors, in turn, will need employees of all kinds, and so will hire African workers.

And as consumption goes up, even more jobs will be created. Distributors will need new pipelines to deliver the gas to end-users, so they will need people who can help them build, operate, maintain, repair, and administer those pipelines, along with associated infrastructure facilities such as storage depots.

And even in the absence of pipelines, they will need to acquire tankers and containers so that they can bring gas to customers by road, rail, or river. Accordingly, they will need people to procure, operate, maintain, repair, and administer these operations.

Meanwhile, there's more. The hiring of more African workers is sure to have knock-on effects. If, for example, employees of upstream operators need a way to get to a remote worksite, local transportation companies may be able to serve them. If so, those transportation companies may have to hire more people to drive their vehicles.

Likewise, if African construction firms need to procure extra building materials to uphold their contracts with upstream operators, local suppliers may be able to meet their needs. And if so, those local suppliers may have to hire more people to handle their inventory.

In other words, as Africa's gas industry grows, it has the potential to create thousands and thousands of jobs! Of course, some of them, such as construction jobs, will be temporary. Some of them will be more permanent, though, especially if the governments of gas-producing states work with upstream operators to develop local hiring and training standards that expand the capacity of the local workforce.

All the Way Down the Value Chain

But the knock-on effect doesn't have to stop there.

In my most recent book, Billions at Play: The Future of African Energy and Doing Deals, I urged African oil and gas producers to look as far down the value chain as they could. I advised them to pursue projects that treated hydrocarbons not just as exportable raw materials but as inputs for value-added operations such as fertilizer or petrochemical manufacturing. I also suggested that they look for ways to focus on gas-to-power projects with the intent of improving domestic electricity supplies — and not just because new power grids would benefit African businesses.

It is true, of course, that some African businesses will be able to create more jobs if they do not have to worry about blackouts. Likewise, it is true that gas-to-power projects will create jobs of their own in areas such as construction, operations, maintenance, and administration. But it is also true that African households need and deserve access to reliable energy supplies, regardless of employment levels — and that gas-to-power plans can help them!

I'm hardly the only person to reach this conclusion. When I wrote Billions at Play, several African countries had already rolled out ambitious gas-to-power schemes. Nigeria, for example, was in the process of implementing a program that promoted associated gas as fuel for new power plants.

Since then, others have followed suit. For instance, as the AEC's energy outlook notes, Senegal has unveiled plans for using its future gas production to generate electricity for the domestic market. Mozambique already has a couple of gas-to-power projects in the works, too.

But it shouldn't stop there. I'd like to see more gas producers do this as they ramp up gas production in the second half of the decade. If they do, they will have accomplished something beyond merely increasing output levels. They will have taken concrete action to strengthen their economies and benefit their own citizens. And in so doing, they will have made their mark on the world!

NJ Ayuk is Executive Chairman of the African Energy Chamber, CEO of Centurion Law Group, and the author of several books about the oil and gas industry in Africa, including Billions at Play: The Future of African Energy and Doing Deals.

Uganda Can Transition Towards Clean Household Cooking Energy Using Her LPG

By Diana Taremwa

Much of this year, during the national lockdown imposed by the government to prevent the spread of the COVID19 pandemic, I had all the time to be home and prepare meals for my family. My household mostly uses charcoal for cooking as it’s a cheaper option when compared to Liquified Petroleum Gas (LPG) or electricity. Charcoal is readily available.

Also, during this time, I got to experience the hardships of cooking using charcoal. First of all, it is time-consuming. It takes forever to light up a charcoal stove, the embers have to be fanned and cajoled to life, it's smelly, and the smoke makes the eyes red and itchy, you feel the smoke in your nostrils.

I wondered about the mothers in the village who even deal with something worse; cooking with wood fuel on three-stone fires which is even more dangerous, as well as being environmentally damaging.

Indeed, many low- and middle-income households in Uganda use charcoal which has not only become one of the biggest engines of our informal economy but also one of the greatest threats to our health and the environment.

Natural Gas For Domestic Use

Uganda whose total oil reserves currently stand at 6.5 billion barrels out of which 1.4 billion barrels are recoverable, will soon embark on oil production. It will also produce Associated Petroleum Gas (APG), a form of natural gas which is found with deposits of petroleum, either dissolved in the oil or as a free "gas cap" above the oil in the reservoir.

This gas can be utilized in a number of ways after processing: sold and included in the natural gas distribution networks, used for electricity generation with engines or turbines, re-injected and used in enhanced oil recovery.

The National Oil and Gas Policy 2008 supports the valuable use of gas resources including utilization of natural gas especially in homesteads in-order to reduce reliance on biomass energy which results in indoor house air pollution.

The policy also prohibits the venting of gas and discourages flaring of oil and gas in order to safeguard the environment from increased greenhouse effects. In addition, the The Petroleum (Refining, Conversion, Transmission and Midstream Storage) Act, 2013, states that only those quantities of associated gas needed for normal operational safety can be vented or flared, and even so with approval from the responsible minister.

Therefore, to maximize returns from the oil and gas sector, the government plans to produce 60,000 tonnes of LPG annually for domestic consumption and electricity generation from associated gas.

Regulating Natural Gas Use

According to the ministry of energy, the country is set to embark on the promotion of LPG to replace wood energy and also develop LPG regulations to harmonize distribution, transportation, storage and marketing. A detailed feasibility study on LPG supply, promotion, and infrastructure intervention is ongoing.

Currently, the government has taken measures to make the imported LPG affordable for Ugandans by removing Value Added Taxes on LPG in the 2020/21 financial year budget with an aim of enabling more Ugandans to cook with it. This will eventually lead to a reduction in the number of trees cut for firewood and charcoal.

The cost of LPG has been a big hindrance to its adoption. While many are willing to switch from charcoal and adopt LPG it remained expensive for most people. A 6kg gas cylinder costs at about Shs157, 000 and can be refilled between Shs50, 000 to Shs60, 000. However, with the new tax cuts, the government hopes to increase usage of LPG from the current 0.8% to 20% at the household level.

Reduces CO2 Emissions

According to the World LPG Association, LPG whether used for cooking, transport, heating or industrial applications, it is a clean-burning fuel that reduces CO2 emissions compared to biomass and other hydrocarbon fuels when in combustion.

Ghana has also greatly benefited from its LPG. In 1990, the Ghana National Petroleum Cooperation took a hard look at both the problems of deforestation associated with charcoal use and the flaring of gas during the refining of the crude oil at its Tema refinery.

Recognizing that domestic production of LPG could help protect the environment, the corporation began to produce gas as a source of domestic fuel. In 2013, Ghana launched a rural LPG scheme, in a bid to save forests and shift rural dwellers away from wood fuel use, with the goal of reaching 50% penetration by 2020.

As the government of Uganda continues to seek ways to solve deforestation associated with charcoal use, seek ways to reduce GHG emissions and deal with the effects of climate change LPG offers significant near-term solutions.

Fragile Ecosystems

According to statistics from the Ministry of Energy and Mineral Development (MEMD), Uganda meets more than 93% of its energy demand with biomass in form of charcoal and firewood, 6% with fossil fuel combustion and only 1% with electricity from hydro and fossil-fueled thermal power plants.

The country currently imports all its petroleum-product requirements. Only about 15% of the population has access to electricity, and in rural areas, it’s only 7%.

This has resulted in the depletion of the country’s forests and woodlands, and related health hazards. In the past 25 years, Uganda has lost 63% of its forest cover according to the National Forestry Authority. The loss of these fragile ecosystems not only has serious implications on Uganda’s biodiversity but also compromises the ability of the country to cope with climate change.

The Uganda Demographic Health Survey 2016, also states that cooking with wood fuel is a major cause of respiratory infections among Ugandans such as lung cancer.

Mr. Henry Bazira the executive director at Water Governance Institute, advises that people need to be sensitized about the benefits of using LPG compared to charcoal, this will help save the environment.

 

Uganda’s Oil Developments Jeopardizing A Just Energy Transition

By Cirrus Kabaale

In the wake of the Covid 19 pandemic and the need for governments around the world to ensure a just recovery and transition to low- carbon energy systems for economic and social recovery. Clearly, our government continues to fail us in-terms of current fossil fuels development plans. Government of Uganda is still making progress towards the development of its 6.5 billion barrels of oil, with plans to build a $3.5 billion East African Crude Oil Pipeline EACOP.

However, as the government seeks to turn oil reserves into tomorrow’s fuels, oil development will certainly further lock us onto the path to irreversible climate change and failure to meet our Paris climate goals. Moreover, most oil projects continue to rob locals of their land and livelihoods with disregard and violation of their land, property rights. These are degrading the environment and climate in equal measure, fueling a triple crisis.

In Hoima district, 29 square kilometres piece of land was acquired by the government to pave way for the Airport and oil refinery. The crude oil pipeline covers 296Km and traverses 10 districts, 22 sub-counties and an estimated 172 villages. These projects continue to eat up land that locals depend on for their livelihoods. Uganda is an agriculture-dependent country. The sector remains the main source of livelihood and employment for over 60 percent of the population.

A recent report by Environmental Governance Institute EGI working with three environmental organizations from Ghana, Nigeria and Togo in cooperation with Friends of the Earth Netherlands and Both ENDS reveals that since the signing of the Paris Climate Agreement, rich countries have provided almost 50 times as much support for fossil fuel-related projects less for clean energy projects in the four African countries. It further states that rich countries through export credit agencies ECAs insured energy projects with a total value of 11 billion US dollars and more than half of this export support is related to fossil fuels. Only 1% went to sustainable renewable energy. Export credit agencies provide insurances and guarantees to companies doing business abroad.

The report titled “A Just Energy Transition for Africa? Mapping the impacts of ECAs active in the energy sector in Ghana, Nigeria, Togo and Uganda”, calls upon these rich countries to stop support for fossil fuel developments including the EACOP and large hydro-power dams in Uganda that undermine the Paris agreement, aggravate climate change, destroy the environment, heighten human rights violations and leave local communities disenfranchised.

The report spotlights the story of 56-year-old widow Beneconsicla in Western Uganda who has to leave her land on which her banana plantation sits that she depends on to feed and provide for her family of 5 children. She has to pave way for the EACOP which is supported by the United Kingdom based Export Credit Agency UKEF.

Uganda is a signatory to the Paris agreement and according to its Nationally Determined Contributions, the country has committed to a 22% emission cut on a business as the usual basis by 2030 in a bid to mitigate and adapt to climate change and transit to a low-carbon climate-resilient economy. However, developing oil and gas resources will increase greenhouse gas emissions. One of the most significant gases emitted when fossil fuels are burned, is carbon dioxide, a greenhouse gas that traps heat in the earth's atmosphere and is responsible for global warming. 

Without urgent action to reduce greenhouse gas emissions and pollution, climate change will worsen. we will see more frequent and intense rains, flooding and deeper droughts that will have a major impact on vulnerable communities. It’s also important to note that scientists have long warned that climate change will cause an increase in infectious diseases, such as COVID-19. Warmer temperatures and increased contact between humans and animals due to loss of habitat will increase the transmission of diseases. 

Responding to the double crises of pandemics and climate change requires massive investment in clean energy projects that help tackle the climate crisis and protect the environment. Increased investments in renewable energy will help us transition to a more climate-friendly economy. Uganda still has plenty of clean energy sources to develop. According to Uganda’s renewable energy policy, the overall renewable energy power generation potential is estimated to be 5,300 MW. 

Cirrus Kabaale is the Program Officer Just Energy Transition at Environment Governance Institute Uganda

 

 

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