Published: Mar, 2017
Transparency Market Research states that the leading players in the Africa small hydropower market are Siemens AG, ESKOM Holdings, and Africa Infrastructure Investment Managers. As of 2015, these players held a dominant share of about 34% in the overall market due to a major stake in government projects. Product differentiation along with a high brand value will determine the success of players in the market in the coming years. The diverse competitive landscape in Africa small hydropower market is likely to be affected by the new entrants in the market. However, the new entrants will have to acquiring proprietary technology to make a mark, which will continue to be their toughest challenge in the near future.
Zambia and Ghana to Drive Africa Small Hydropower Market
According to the research report, the capacity of the Africa small hydropower market is expected to reach 49,706.1 MW by 2024 from 9,752.9 MW in 2015. Between the years of 2016 and 2024, the overall of market is projected to expand at a CAGR of 19.2% due to the emerging countries that are working toward reducing their carbon footprint.
Regionally, Zambia and Ghana are projected to dominate the Africa small hydropower market. The report indicates that Zambia small hydropower market will surge at a CAGR of 20% between 2016 and 2024 while Ghana’s total capacity is expected to account for 10% of the overall market during the forecast period.
Pressure to Reduce Carbon Emissions Ups Demand for Small Hydropower
The surging demand for small hydropower in Africa is attributable to the excessive pressure on the region to cut down on its carbon emissions. Despite this pressing need, the region continues to be in a great need for power as majority of the countries are still trying to find their footing in the world economics. Thus, the need to reconcile the problem of demand for energy and regulatory reforms that press for greener solutions has turned the region’s focus toward small hydropower. Today, small hydropower holds an instrumental position in the renewable energy mix as they make no difference to the water flow. In addition, they do to lead to rise in temperature or contribute to depletion of oxygen levels in the water.
The Africa small hydropower market is also expected to flourish in the coming years as it’s a reasonably affordable source of renewable energy. Several energy companies are investing in installing small hydropower capacities as it requires relatively low capital investment as compared to other renewable energy plants. Analysts project that the adoption of off-grid power generation is expected to become an emerging trend in the region as it is the most feasible way of solving the energy crisis problem. Thus, the installations of off-grid small hydropower plants in remote areas of Africa are expected to benefit the overall market.
Lack of Technological Advancements and Adaptability to Hamper Market Growth
Despite the strong market drivers, the Africa small hydropower market faces a few restraints such as remote locations and paucity of technological adaptability in several countries. The region’s energy sector is largely affected by the inaccessibility to basic technologies along with absence of infrastructure that will support the uptake. Collectively, these reasons are expected to hold back the growth of the Africa small hydropower market in the near future.
This review is based on Transparency Market Research’s report, titled “Small Hydropower Market - Africa Industry Analysis, Size, Share, Growth, Trends, and Forecast 2016 - 2024.”
Key segments of the Africa Small Hydropower Market
Africa Small Hydropower Market: Country Analysis
- South Africa
- Rest of Africa
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