WEF wrap: Africa’s energy poverty: a vastly complex, yet simple, equation

'More than 60% of Africa - more than two Americas or half of China - is with without any access to any form of energy'.

A recurring theme at the World Economic Forum on Africa was just how much fixing the region’s infrastructure bottleneck would add a tailwind to the continent’s already-above global average growth.

Panel discussants, interactive sessions and interviews yielded the same message—fix the infrastructure, especially electricity, and poverty in the region would be history. Nigeria, Africa’s biggest economy, barely scrapes 4,000MW, or an eighth of the capacity of rival South Africa, which is itself struggling to meet demand.

A major conference in Addis Ababa is expected to come with innovative ways of financing Africa’s growth, with a big focus being on channeling trillions into infrastructure. The outgoing president of the African Development Bank, Donald Kaberuka, told Mail & Guardian Africa that refocusing the bank towards infrastructure, including energy, was a key plank of his legacy.

Africa’s energy challenge is framed by a current population of 600 million people without power, which is expected to balloon to 1 billion people once population growth and urbanisation are taken into account.

This places a huge strain on the continent’s ability to grow economies, lift millions of people out of poverty and provide opportunities for its predominantly youth population to gain and education.

The energy conundrum is a vastly complex equation that calls for co-operation, and at times compromise, between public and private sector partners, which does not yet even begin to touch on the technical complexities of powering the continent.

“More than 60% of Africa - more than two Americas or half of China - is with without any access to any form of energy. With the rate of population growth as well as the rate of urbanisation, that figure is likely to go above 1 billion, of which half a billion will be in cities by 2030,” Jasandra Nyker, CEO of Biotherm Energy, said in a panel discussion at the World Economic Forum on Africa in Cape Town.

Shorter time
“We have heard many times before about the African Renaissance, but to ensure that we create a game-changing environment we all need access to electricity. To alleviate our energy poverty, we need access to energy in a much shorter time frame.”

Biotherm develops wind and solar energy projects in a number of countries on the continent and is one of the players participating in South Africa’s independent power producer (IPP) programme. Renewable projects are renowned for coming on line a lot quicker than fossil fuel, nuclear and gas-powered projects.

At a second panel discussion focusing on the challenges of powering Africa, the tensions between the public and private sector came to the fore.

Panel moderator, and chairman of Mail and Guardian, Trevor Ncube commented on a seeming lack of urgency on the continent to address the power deficit.

Namibia’s finance minister, Calle Schlettwein, responded from the audience that this was not the case but rather a process delayed by the need to ensure an equitable deal was struck with independent power producers.

“Financiers insisted on a guarantee of price, they insisted on no taxes at all and on a policy freeze, and that was the basic framework. That was too greedy, if I may say so. We must have a toning down of the ambition on the side of the financiers,” he said.

Policy certainty
Panel member Linda Mabhena-Olagunju, managing director of DLO Energy Resources, an IPP, said the request for policy certainty was needed to give investors the confidence that later changes would not adversely affect the revenue model.

“People want to come into Namibia and play on the rest of the continent, but if there is not a stable environment for investors there is no need we wouldn’t come in,” she said.

What is clear from the two panel sessions on Africa’s energy environment was that the question is far less about the type of technology needed, but about ensuring that policy certainty is achieved and that the regulatory environment is in place to attract the private sector.

Bigger questions such as regional integration and regional grids barely merit mention. The multiple challenges around power generations pale in comparison with the bigger issue of a distribution network.

Simply even having a network that wind or solar projects can feed into is in itself a major obstacle. In most cases they just don’t exist.

This presents opportunities for those who are motivated enough. Such as Michael Nganga of social enterprise GiveWatts that has developed a solar LED lamp that allow communities in the remotest regions to have a sustainable, affordable light.

Simple solution
“The big question we want to answer is what does Africa need most: we nee more engineers, we need more doctors, we need more teachers,” he said. “We cannot rule out the change that someone who needs a light now can wait until the grid gets to them. We need to push to make it happen.”

This simple solution to a very significant problem highlights the level of innovation, but equally the desperation of communities who are being left in the dark while policymakers and political leaders dither on this issue.

The frustration felt by ordinary people on the continent was most poignantly stated by the pained comment from an Angolan audience member: “The point is that we have to resolve this problem. We are tired of hearing about all the plan and projects and nothing is working.”

There is little doubt that the challenge is not one of appropriate technology, or the availability of solutions, nor even a lack of capital. Investors, independent power producers and providers of all manner of engineering equipment and skills are at the ready. The question is: are Africa governments? And if not, why not?

—Lee Mwiti contributed to the writing of this report.

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