Howard Kennedy LLP and GBS Africa were delighted to host a thought provoking webinar discussing the growth of renewable energy projects in Africa and the trends and opportunities arising.
We were joined by an expert panel of speakers that included:
- Agnes Gitau, Managing Partner, GBS Africa;
- Duncan Bagshaw, Head of Africa Group and Jonathan Cohen, Head of Energy Group, Howard Kennedy LLP;
- Ibrahim Kitoo, Chief Legal Officer, KenGen (Kenya's National Power Generation Company);
- Stephen Karangizi, Director and CEO, The African Legal Support Facility (part of the African Development Bank);
- Bill Barry, Managing Director, ARCH Emerging Markets Partners (who manage the ARCH Africa Renewable Power Fund); and
- Ricardo Martinez, Director, Qbera Capital (asset management firm specialising in renewable projects).
Key points discussed
- Africa's rapid economic expansion creates a daunting energy challenge.
- However, Africa is rich in renewable energy sources and combined with falling technology costs means Africa is on the cusp of a renewable energy revolution.
- There are a number of challenges to overcome to further deploy renewables on the continent. These include: underdeveloped regulatory frameworks, lack of sovereign guarantees, currency risk and long lead times to financially close projects which all lead to 'bankability' issues which affect the availability of finance.
- There is no 'one size fits all' approach as the legal, policy and regulatory frameworks are very different in each African country.
- Novel business models are emerging including on-site captive solar models, C&I energy procurement, lease models, corporate PPAs and off-grid structures.
- Renewable energy projects are being developed in Africa at a faster pace than ever before and decisions made today will shape the continent's energy sector for decades.
Agnes Gitau
opened the event by sharing a key message that in order for Africa to attract external investment it needs to develop sustainable and resilient energy systems.
Stephen Karangizi
expertly explained some of the 'bankability' issues facing the deployment of renewables projects. He noted that a more tailored approach to contract documentation would greatly improve the successful implementation of renewables projects.
Ibrahim Kitoo
gave the generator perspective explaining that recent legal reforms in Kenya regarding the unbundling of state-owned monopolies has led to greater competition in the power sector which has, in turn, led to greater deployment of renewables. He noted that KenGen now successfully generate 80% of their total generation capacity from renewable sources.
Bill Barry
gave his informed perspective as a funder/developer on some of the early stage challenges of renewables projects in Africa. He noted that it is crucial to obtain technical, legal and financial expertise to de-risk investments and deliver projects on time and budget. He also gave an overview of some of the novel C&I solar structures and off-grid models that he is involved with.
Ricardo Martinez
shared some fascinating insights into the funding shortfall for emerging and frontier markets to meet the UN's SDG goals by 2030. He also spoke from the investor angle including the focus on default risk vs liquidity issues, blended finance being an effective tool and how mobilising the private sector is key.
Howard Kennedy's Africa Experience
Our team regularly advises on African projects, deals and disputes. We combine great expertise in our field with experience and knowledge of a range of African jurisdictions to offer strong representation across the continent.
We have particular experience in the power and renewable energy, oil and gas, hotels and hospitality and media and technology sectors.
Some of our team's recent experience includes:
Advising a large C&I customer on the development of a solar captive model in Mali
Acting for an international developer on the drafting of a PPA for a 40MW solar PV facility in Northern Ghana.
Acting for a multi-national equity investor on its investment in a geothermal power plant in the Corbetti caldera of Ethiopia.
Advising the international project developer Skypower on a large solar PV project in Djibouti, East Africa.
Advising the Nigerian Government on electricity market reform and restructuring.
Acting for a Nigerian oil consortium in proceedings in the English Commercial Court for over US$50m.
Acting for a global strategy and communications consultancy on the strategic buyout of the Nigerian subsidiary.
Assisting high net-worth individuals with visa and immigration issues.
Advising Manroy, an international munitions dealer, on its agreed public takeover by Herstal SA.
Advising on a distribution agreement for a TV network across 39 jurisdictions in Africa.
Internal investigation in Angola in relation to suspected bribery of officials with connections to a SFO investigation.
Advising the British Humanist Association, Witchcraft and Human Rights Information Network on a £500m claim.
Representing African investors in a joint venture to develop and operate hotels in East Africa, in arbitration proceedings against co-investors.
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