African countries will need to quadruple their rate of investment in their power sectors for the next two decades to bring reliable electricity to all Africans, a new International Energy Agency (IEA) study published said.
If African countries continue on their policy trajectories, 530 million Africans will still lack electricity in 2030, the IEA report said.
It said bringing reliable electricity to all Africans would require annual investment of around Sh12 trillion ($120 billion.)
“We’re talking about 2.5 per cent of GDP that should go into the power sector,” Laura Cozzi, the IEA’s Chief Energy Modeller, told journalists ahead of the report’s launch. “India’s done it over the past 20 years. China has done it. So it’s something that is doable.”
Taking advantage of technological advances and optimising natural resources could help Africa’s economy grow four-fold by 2040 while requiring just 50 per cent more energy, the agency said.
Africa’s population is growing at more than twice the global average rate. By 2040, it will be home to more than two billion people.
Its cities are forecast to expand by 580 million people, a historically unprecedented pace of urbanisation. While that growth will lead to economic expansion, it will pile pressure on power sectors that have already failed to keep up with demand.
Nearly half of Africans - around 600 million people - do not have access to electricity. Last year, Africa accounted for nearly 70 per cent of the global population lacking power, a proportion that has almost doubled since 2000.
Some 80 per cent of firms in sub-Saharan Africa suffered frequent power disruptions in 2018, leading to financial losses that curbed economic growth.
The IEA recommended changing how power is distributed, with mini-grids and stand-alone systems like household solar playing a larger role in complementing traditional grids.
According to IEA Executive Director Fatih Birol, with the right government policies and energy strategies, Africa has an opportunity to pursue a less carbon-intensive development path than other regions.
“To achieve this, it has to take advantage of the huge potential that solar, wind, hydropower, natural gas and energy efficiency offer,” he said.
Despite possessing the world’s greatest solar potential, Africa boasts just five gigawatts of solar photovoltaics (PV), or less than one per cent of the global installed capacity, the report stated.