How Can African Countries Participate in U.S. Clean Energy Supply Chains?

Summary

The United States is prioritizing the development of new clean energy industries and supply chains to address climate change and geopolitical challenges, alongside a renewed focus on enhancing economic and strategic relationships with African countries. This convergence presents opportunities for African nations to integrate into the US clean energy sector.

Key Points:

1. Policy Focus: Recent US legislation, including the Inflation Reduction Act, Infrastructure Investment and Jobs Act, and the CHIPS and Science Act, aims to build out clean energy industries and secure supply chains.

2. African Potential: Many African countries possess abundant natural resources essential for clean energy technology production, such as minerals critical for batteries and solar panels.

3. Three Opportunities:

   • Transition Minerals and Battery Manufacturing: African countries can supply processed transition minerals to US manufacturers, aligning with US strategic objectives for diversified mineral sources.
   • Research, Development, and Commercialization: Collaboration through partnerships and state-level initiatives can facilitate technological innovation, particularly in hydrogen and renewable energy sectors.
   • Data Collection and Analytics: Enhancing data sharing on mineral allocation and demand forecasting supports both US policy-making and counters competitive energy diplomacy.

4. Recommendations:

   • Reform AGOA: Consider the AGOA framework for sourcing minerals, fostering a trade agreement akin to Japan’s Critical Minerals Agreement.
   • Mineral Security Partnership: Extend membership to select African countries, paired with investment promotion strategies.
   • Support for African Institutions: Strengthen the African Minerals Development Centre and other bodies for resource management and thought leadership.

Conclusion

The integration of African countries into the US clean energy supply chains represents a significant shift from traditional economic relationships. By leveraging existing resources and capacities, and through strategic partnerships, both regions can benefit from enhanced cooperation, leading to more sustainable energy systems and strengthened bilateral ties.