Women in Energy: In conversation with Ana Hajduka on promoting renewables and addressing regulatory hurdles in energy sector

Africa GreenCo helps ensure a stable power supply and promotes energy trade through the purchase of electricity from renewable energy producers and selling it to utility companies and businesses. In this interview, Founder and CEO Ana Hajduka gives insights into the company’s role in accelerating the region’s energy transition. 

From 1996 to 2021, South Africa’s access to electricity has substantially improved — rising from 57.6% to 89.3%. However, as noted by Deloitte in its Africa’s energy outlook report, the country remains heavily reliant on fossil fuels, with nearly 95% of its primary energy consumed in 2022 coming from coal, oil, and gas. As early as 2011, the government already launched the Renewable Energy Independent Power Producer Procurement Program to address energy shortages and promote renewables. Further helping the country transition into cleaner energy are entities like Africa GreenCo Group.

Through its company GreenCo Power Services Limited, Africa GreenCo buys electricity from renewable energy producers and sells it to utility companies and businesses. This helps ensure a stable power supply and promotes energy trade, particularly in the Southern African Development Community (SADC) region. 

In this interview, Founder and CEO Ana Hajduka gives insights into the company’s role in accelerating the region’s energy transition. As a lawyer herself, she also discusses various legal and regulatory challenges, the importance of open access and competitive markets, and how the company’s model enhances energy reliability and sustainability. Hajduka also highlights strategies for managing risks, improving infrastructure, and implementing policy reforms to support a fair and equitable energy transition across Africa.

 

Interviewer: You have extensive experience with project finance and public-private partnerships in energy and infrastructure projects. How do you envision the role of Africa GreenCo Group in accelerating Africa’s energy transition?

Ana: Africa GreenCo Group is strategically positioned to accelerate Africa’s energy transition by acting as a creditworthy intermediary buyer, aggregator, and trader of renewable energy in the SADC region. Our role involves purchasing power from renewable independent power producers (IPPs) and selling it to utilities, municipalities, and large power consumers with flexible supply solutions. 

By being strongly capitalized and leveraging a diversified portfolio of supply and demand, GreenCo reduces the financial risks associated with renewable energy projects, making them more attractive to private investors. Additionally, as a trader on the Southern African Power Pool (SAPP), GreenCo enhances regional power trade, improves the reliability and affordability of energy supply, and contributes to the decarbonization of the Southern African grid. We are currently operational in Zambia, Zimbabwe, Namibia, and South Africa.

 

Interviewer: As a lawyer, what major legal and regulatory challenges do you see in the renewable energy sector in Africa today?

Ana: A number of countries in Southern Africa have particularly moved toward opening their markets and introducing competitive markets. Open access and competitive markets in the electricity sector are crucial for Africa’s sustainable development, as they can improve energy access, reliability, and affordability and can help in diversifying risks across power pools and multiple countries for both supply and demand. 

The concept of open access in the electricity sector involves allowing multiple electricity generators and suppliers to use the existing transmission and distribution networks, promoting competition and efficiency. New legislation and clarity are needed in many countries to ensure the successful introduction of an open-access market. Significant strides have been completed by Zambia, Namibia, Zimbabwe, and South Africa in particular.

Open access allows various electricity producers, including IPPs or traders/aggregators on their behalf, to use the national grid to supply power to consumers. This approach will encourage investment in renewable energy and ensure a more stable and diversified energy supply. By providing more players access to the grid, competition increases, leading to better service delivery and potentially lower electricity costs for consumers.

A major regulatory challenge is the requirement for establishing very strong independent regulatory bodies. This is essential for overseeing the electricity market. These authorities ensure compliance with regulations, set tariffs, and manage grid access to maintain a level playing field. In addition, relevant grid codes and standards need to be set to establish the technical requirements for grid connection and operation. It ensures that all market participants adhere to consistent standards, promoting reliability and safety. 

In addition, transparent and fair pricing mechanisms for electricity tariffs and transmission charges are crucial. This involves setting tariffs that reflect the true cost of service and ensuring that prices are not manipulated by dominant market players. Laws and regulations must explicitly provide for open access to the transmission and distribution networks. This includes clear rules for grid connectivity, capacity allocation, and dispute resolution mechanisms.

 

Interviewer: How does your model of purchasing power from renewable IPPs and selling it to utilities and private sector off-takers enhance energy reliability and sustainability in the region? What are some strategies Africa GreenCo Group uses to find buyers and manage risks in the electricity market?

Ana: Our model enhances energy reliability and sustainability by aggregating renewable energy supply from various IPPs and diversifying the customer base, including utilities, private sector off-takers, and, ultimately, the regional power pool. This reduces the risk of default and ensures a continuous power supply even if one of the buyers fails to meet its obligations. 

We find buyers by leveraging our extensive network within the SAPP and engaging with large industrial consumers and commercial entities seeking reliable and sustainable energy sources. To manage risks, we conduct thorough credit assessments, diversify our off-takers, and maintain a liquidity buffer to support our payment obligations and mitigate the impact of defaults. Our liquidity buffer is channeled through GuarantCo, an AA-rated entity that gives significant comfort to the lenders of the underlying generation projects regarding our bankability.

 

Interviewer: From your experience, in what ways can improved infrastructure development enhance energy access and reliability across Africa, particularly in rural and underserved regions?

Ana: Improved infrastructure development is crucial for enhancing energy access and reliability. Investments in transmission and distribution networks can reduce losses and extend grid reach to rural and underserved areas. Decentralized renewable energy systems, such as mini-grids and off-grid solar solutions, provide immediate and long-term benefits to remote regions. Furthermore, infrastructure enhancements for energy storage and smart grid technologies can stabilize supply, integrate renewable energy sources, and ensure energy availability when and where it is most needed.

 

Interviewer: What governance models and policy reforms do you think are needed to support a fair and equitable energy transition that benefits all Africans?

Ana: To support a fair and equitable energy transition, governance models should promote transparency, accountability, and inclusivity. Establishing independent regulatory bodies to oversee the energy sector and ensuring policies are developed through inclusive consultations with all stakeholders are vital. And these especially have to be conducted on a bottom-up basis. 

Policy reforms should create favorable investment climates by providing incentives for renewable energy projects, ensuring cost-reflective tariffs, and providing open access to encourage private sector involvement. Additionally, policies supporting capacity building and local content requirements can guarantee that the energy transition benefits are widely shared and contribute to socio-economic development across the continent.

 

Ana Hajduka is one of the speakers at the upcoming Africa Energy Leadership Summit, which has for its theme “Investments, integration, infrastructure, and governance to fuel the energy transition.” The summit will be held as part of the first-ever Africa Energy Expo, taking place in Kigali, Rwanda, from November 4 to 6, 2024. 

Africa Energy Expo, endorsed by the Rwanda Ministry of Infrastructure and supported by the Rwanda Convention Bureau, will gather key African decision-makers to tackle the continent’s energy and power infrastructure gap. The event supports COP27 Africa climate pledges and the Africa Power Vision. 

 

Join us at the Africa Energy Expo from 4 - 6 November in Kigali Centre Rwanda and experience the Africa energy landscape at its finest. The event will serve as a scene-setter to the Africa Power Vision by bringing key energy stakeholders together to increase the level of international support and facilitate access to modern, affordable and sustainable energy solutions in Africa.