UN Agency roots for strong policies to light up Africa

Yohannes Hailu, an energy policy expert at the Private Sector Development and Finance Division of ECA. [Courtesy]

The United Nations Economic Commission for Africa (UNECA) has called for the implementation of supportive policies and strong regulations to boost private investment in the energy sector in Kenya and other African countries.

This will accelerate the process of electricity connections in the continent, the agency says.

Despite the immense potential for development in the electricity sector, the continent remains one of the least electrified regions globally.

According to Yohannes Hailu, an energy policy expert at the Private Sector Development and Finance Division, (PSDFD) of ECA, there is low private sector investment in energy infrastructure and service delivery on the continent.

Consequently, to change this scenario, he urged African countries to reform the policy and regulatory frameworks to ensure adequate openness, and attractiveness, which will ready the African market for private investments, energy experts agree.

According to him the socio-economic transformation of African countries will depend upon the ability to accelerate infrastructural development and industrialisation, enabled by “access to modern, reliable and affordable energy within an energy transition system.”

This requires substantial investment, including a robust role from the private sector, the UNECA energy expert said.

Policy and regulatory frameworks thus play a crucial role in the building of an enabling business environment, he emphasized.

Based on assessment in 16 countries undertaken by the UN Economic Commission for Africa (ECA) and RES4Africa Foundation, Mr Hailu said key areas for improvement related to market openness such as policies and plans, sector regulation, market organization, private sector participation models and procurement models.

“In addition, there is a need for attractiveness through contracts and economic regulation, incentives and credit enhancement. Readiness such as the presence of permits and authorization administration, technical codes and grid access is also important to fast-track private investment through a better enabling environment,” he said.

Mr Hailu further revealed that the African Union Commission and the ECA have developed the Continental Regulatory Framework to Crowd-in Private Investment in Africa's Electricity Markets.

This framework assists Member States in their efforts to enhance regulatory planning.

Furthermore, the ECA and RES4Africa have developed a regulatory planning tool called ROAR, which helps strengthen institutional capacity for planning and implementing reforms.

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