REPORTS

As Africa prepares to host the COP 27 this year, all eyes are on the continent, expecting to see the efforts that are being put in place towards the energy transition. Whiles Africa’s development trajectory is quite unique and different from the rest of the world, the continent needs to be conscious in its energy transition journey.  Africa already has a serious energy deficit to meet its current economic needs implying new energy sources will have to be built. To cater for this energy deficit, and the energy requirements of new developments, Africa needs to increase its energy generation capacity, in a sustainable way. To meet greenhouse gas emission reduction targets under the Paris Agreement, renewable energy production must scale up fast. This means that global production of several rare earth minerals used in the production of solar panels and wind turbines—especially neodymium, terbium, indium, dysprosium, and praseodymium must grow twelvefold by 2050

At present, Africa has a mix of energy sources in use or under development including fossil fuels (thermal coal, and petroleum) and some green energies (hydro,solar, wind and geothermal) with which storage technologies are still being developed. With the potential for significant discoveries of REE reserves, Africa should pivot towards green energies, which will also become markets for its REE products. By establishing energy efficiency, Africa would have a twin benefit– creating a sustainable low carbon future, and creating a market for its REE natural resource, accompanied by economic benefits including employment creation, GDP growth, and savings on foreign currency.

Presently, all the equipment and materials for the establishment of green energy projects are being imported at high cost and draining country reserves of scarce foreign currency. Developing the REE value chain to consumption can result in cheaper products (magnets and batteries) on the basis that other supply chain resources, like labor, can be sourced relatively more cheaply in Africa than in the developed world. Although solar panels hardly use REE, except for the thin film PV cells which use gallium (and indium) among other metals for their production, wind turbines require large amounts of REE in turbines for the electrical generation drive.

This report to assesses current and future status of REE reserves and their value chain in Africa Identifies opportunities and challenges for value addition in the REE value chain in Africa, specifically in DRC; and proposes policy options for promoting value addition, efficiency, and equity of the REE value chain in Africa.