New Research Identifies an Action Agenda for Africa’s Electricity Sector

New Research Identifies an Action Agenda for Africa’s Electricity Sector

To meet the development needs of a growing population, Africa’s electricity sector requires a major transformation.

Despite important changes over the past decade, efforts to expand and modernize the sector need to be redoubled. Indeed, current electrification rates, generation-capacity levels, and security-of-supply indicators underscore that much is yet to be accomplished.

New research identifies five sets of complementary actions to put Africa’s electricity sector on track to sharply increase electrification rates and secure long-term access to affordable and cleaner energy.

Africa’s development needs are as diverse as the countries in the continent. Yet, none of those needs will be met unless a reliable supply of affordable electricity, generated through clean fuels, is available to all.

These are the five recommendations made in the research:

  • Introduction of a combination of supply-side incentives and demand-side subsidies, to help expand electricity markets
  • Digitalization of energy sector planning and management tools, to help deliver energy at the right time, in the right place, at the lowest cost
  • Integration of local-content requirements in renewable-energy policies, to capture employment benefits and ensure that state-of-the-art technologies are fully adopted by African countries
  • Strengthening and expansion of regional power pools through African-led international partnerships, to expand electricity access and reduce electricity bills
  • Expansion of investments in off-grid and interconnected clean-energy mini-grids, to account for the different socio-economic realities across urban, peri-urban and rural areas

All countries struggle to meet three goals: Security of reliable and affordable energy supplies, universal access to modern forms of energy, and reduction of polluting emissions. Africa’s development challenges magnify the task of achieving these goals. What’s important to remember, for African and all other countries alike, is that these three goals cannot be achieved in isolation from one another.

An essential Sustainable Development Goal

Achieving universal access to clean and affordable energy, as outlined in Sustainable Development Goal (SDG) 7, is a pre-condition for reaching most of the other 16 SDGs. Access to energy positively affects everything from health to the fight against poverty and pollution to opportunities for education and climate action.

Investment in, and integration of, clean energy across Africa can enable the full suite of SDGs and make the energy future of the continent one that facilitates equity and climate justice. But there is a need for international support and partnerships to ensure funding and investment in the information systems required to make this happen.

Even though rural electrification has seen significant progress, at least 250 million people in Africa still live without electricity. Because of the COVID-19 global health pandemic, an additional 80 million people on the continent have fallen into extreme poverty.

Africa’s electricity sector has to undergo a profound transformation, with the twin objective of addressing electricity access and security of supply in ways that are compatible with a healthy climate.

An independent champion

Power, agency and politics play out in ways that are not necessarily conducive to meeting key societal goals related to environmental quality, employment, and equity. Specifically, the research lists incumbents in the energy sector resisting change, information asymmetries among different stakeholders invariably punishing prospective new entrants in the energy sector, and priorities and procedures on the part of bilateral and multilateral lenders that are unduly rigid.

The time is right. Earlier this year, the African Single Electricity Market was launched. There is a need to capitalize on the opportunities it offers to leapfrog to an electricity sector for the future. Africa has the energy endowment to do so, and the technologies are there. Therefore, as we write in the article, leadership has to be up to the mark.

The stakes are high, because electricity has spillover effects on the entire economy—from a macro-economic point of view, but also, and especially, from the point of view of the livelihoods of the poorest communities in the continent.

Energy, and especially electricity, is central to human development. The tragic COVID-19 global health pandemic, which is pushing many in Africa into extreme poverty, is magnifying the impact that electricity access has on livelihoods.

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