With extraordinary conditions and almost unrivalled endogenous resources, including some of the largest hydroelectric resources in south-eastern Africa, the potential for successful implementation and exploitation of renewable energy sources (solar and wind) is enormous. It can and must be encouraged. Following Ministerial Resolution No. 61/2023 (in force since 1 January 2024) or, better still, the Republic of Mozambique’s Just Energy Transition Strategy, which focusing on the 2015 Paris Agreement, aims to ‘clearly guide the development of the country’s energy sector and ensure a fair and equitable transition’, 2025 is already a year of investment and a renewable-based energy transition is underway.
Commonly referred to as ETS (without reference to the official designation ‘Fair’, which is expected to be achieved), the Energy Transition Strategy builds on the country’s immense potential of endogenous resources, seeking to respond to a growing need to satisfy domestic energy consumption, which, in a macroeconomic context, is intended to be environmentally and economically viable. Mozambique wants a future, self-sustainability and growth. It has extensive arable land and abundant water sources, with three deep seaports (Maputo, Nacala and Beira), rich deposits of liquefied natural gas (LNG), biomass and minerals (the country’s main exports being titanium, vanadium steel, niobium, aluminium, graphite and coal, with applications in the aviation, aerospace, electronics, metallurgy, energy, transport and construction industries, among others).
It is the responsibility of the State, under the terms of Article 203(e) of the Constitution of the Republic of Mozambique (CRM), to ‘stimulate and support the exercise of business activity and private initiative and protect the interests of consumers and the general public’, and this should be done in accordance with the Constitution.of the Constitution of the Republic of Mozambique (CRM), to ‘stimulate and support the exercise of business activity and private initiative and protect the interests of consumers and the general public’, which should be framed and pursued with a view to the ‘rational use of all natural resources’ (Article 90 of the CRM).
However, transition requires investment, as well as stable economic conditions and targeted taxation (albeit phased). With a view to increasingly greener taxation, stimulating innovation for sustainable development involves reconciling the use and protection of endogenous resources (and the environment) with the economic growth that is essential for States, which will be responsible for promoting this by encouraging behaviour more in line with their objectives.
For the period 2023-2050, the ETS has identified three strategic objectives for the country: (i) National development (promoting and accelerating universal access through clean domestic energy sources and the competitiveness of productive sectors), (ii) Regional Energy Hub (providing low-carbon energy to SADC countries – Southern African Development Community) and fostering (iii) Global Energy Transition (exporting green products to decarbonise global supply chains). This will be based on fourteen development programmes organised into four pillars (‘Modern energy system based on renewable energy sources’, ‘Green industrialisation’, ‘Universal access to modern energy’, ‘Adoption of clean energy for vehicles’).
The ETS thus appears to be aligned with the threefold function that can be identified in modernised (green) energy policies: (i) protecting the environment and reducing energy dependence on foreign sources; (ii) promoting growth and employment; and (iii) contributing to the reduction of external imbalances, always depending on the geographical, economic and political context of a given State.
By providing incentives for efficient resource management, ‘green taxation’ contributes to making natural capital profitable and preserving it, ensuring the proportional and sustainable use of land and territory, and facilitating an energy transition and low-carbon economy. This is equally or even more important given the needs of populations living in the most vulnerable communities and/or territories, where investment in infrastructure is crucial given the finite nature of endogenous resources or their dependence on the ability to adapt. The example of biomass (justified by the country’s extensive forest cover), in addition to representing the basis of the traditional coal and wood sectors, also represents the emerging sectors of modern biomass production (briquettes, energy pellets, fuel alcohol, ethanol, among other biofuels). Deforestation resulting from timber extraction and the conversion of forest areas to agriculture must always be balanced, and investment, for example, in climate funds for carbon capture projects focused on the export of green fuels is a must.
Growth policies are thus taking on a new environmental dimension, gradually positioning Mozambique as a more competitive, innovative and inclusive (and tendentially low-carbon) player, favouring global and domestic access to more and diversified energy sources and making a significant contribution to a positive trade balance. It may make sense to activate fiscal mechanisms in the form of incentives, tax reductions and/or duties on certain supply flows for appliances, machinery and other equipment intended exclusively or mainly for the capture and use of solar, wind and geothermal energy and other alternative forms of energy or pellets and briquettes produced from biomass, or exemptions.
The full adoption of ETS measures will reinforce the path that Mozambique has been following, gradually moving down (from an average of 39th position between 1993 and 2011 to 66th in 2022) from the top positions to lower positions in the Global Climate Risk Index (GermanWatch, online, February 2025), which analyses and ranks the extent to which countries (171) and regions have been affected by the impacts (human and economic costs) of extreme weather events. Ambitious goals, stability and predictability in investments risk turning Mozambique into a renewable powerhouse. The transition has only just begun.
