Almost half of the population of Africa does not have access to electricity. It is, therefore, critical for the continent to increase its access to a clean, decarbonized, decentralized energy supply.
To enable this energy transition, countries across the continent are implementing policies that take into account the energy crisis. Alongside other jurisdictions, they are also launching initiatives and providing funding, investments and grants for African renewable energy projects.
In 2022, a group of African countries launched the African Carbon Markets Initiative with the aim of eventually producing 300 million carbon credits annually. To allow countries to voluntarily cooperate with each other to achieve emission reduction targets as set out in their Nationally Determined Contributions, Article 6 was introduced in 2021. Under Article 6, countries will be able to transfer carbon credits earned from the reduction of their greenhouse gas emissions to other countries to meet their climate targets.
In June 2023, the Johannesburg Stock Exchange (JSE) proposed amendments to the JSE Listings Requirements including a new section which contains the listing requirements of the Black Economic Empowerment (BEE) Segment of the JSE. Among other things, these requirements include that trading in BEE securities must be restricted to a BEE-compliant person pursuant to the use of either a BEE contract or a BEE verification agent. The JSE has invited comments on the proposed amendments by 17 July 2023.
Hydrogen markets in Africa are expected to grow exponentially but there are still multiple barriers to the widespread development of decarbonized hydrogen. Each energy sector investment faces challenges in the form of infrastructure gaps, policy, regulatory, economic and financial barriers. A recent positive development in this regard is the announcement that a dedicated blended finance fund, SA-H2, has been launched to raise USD 1 billion for the construction of green hydrogen projects in South Africa. Once established, the SA-H2 will join the SDG Namibia One Fund to offer a blended finance solution for Southern African’s green hydrogen sector.
The African Growth and Opportunity Act (AGOA), which allows duty- and quota-free exports from eligible African countries into the United States, is due to expire in 2025. There has been much speculation that it might be replaced with new trade agreements between the two regions that will follow the free trade policies of the African Continental Free Trade Area agreement and the reciprocal trade initiatives promoted as part of the US’s Prosper Africa initiative. It has also been suggested that an evolved AGOA might be the way forward, creating an increasingly mutually beneficial trade relationship between the two regions.
As of the world’s top producers of many critical minerals, Africa is gearing up for its role in powering global energy transition. Its vast critical mineral store, including cobalt, copper, bauxite, chromium, high purity iron ore, platinum group metals, lithium and rare earth metals, is in high demand globally. For Africa, the focus now is on the sustainable growth of its mineral mining operations and production facilities, so that the gains from its natural resources can be of benefit to the continent and its people.
As more of Africa’s power is generated via renewable energy, the need for reliable energy storage has become increasingly important for grid resilience and flexibility. This necessitates the mass adoption of energy storage as a balancing asset. As a result, numerous battery storage projects and initiatives are underway across the continent.
Competition authorities the world over have observably expanded their consideration of transactions from applying a purely competition-focused lens to one that incorporates the broader needs of society. Many African merger control regimes have developed a competition policy approach that balances traditional competition law considerations with public interest concerns, especially in terms of market concentration, access to competitive markets for small and medium enterprises and employment considerations.
Our newly updated broad-based black economic empowerment (B-BBEE) guide provides a detailed overview of the regulation of B-BBEE in South Africa. The principal objectives of B-BBEE are to promote economic transformation and enable meaningful participation of black people in the South African economy through increased participation in ownership and management structures, increasing the involvement of communities and employees in economic activities and skills training.
South Africa’s newly enacted Employment Equity Amendment Act (EEA Act) includes changes to the legislation governing workplace transformation, as well stricter compliance measures for designated employers. Once in force, the EEA Act will oblige designated employers to prepare employment equity plans. It will be essential for such employers to align their plans to achieve the targets for the employment of black people under the broad-based black economic empowerment codes of good practice with their employment equity plans.