By Herman Opondo
The Centre for Strategic and International Studies (CSIS) recently published an analysis on achieving universal energy access in Africa amid global decarbonization. The reading was so interesting that the African Energy Security Coalition followed this up with a position paper on how Africa could bolster its energy access.
Africa faces a profound energy crisis, with 75% of the world’s population without electricity living on the continent. The situation is especially dire in sub-Saharan Africa, where 600 million people lacked access to electricity in 2022.
As Africa’s population is projected to reach 2.5 billion by 2050, the continent’s energy demand will soar, exacerbating existing challenges unless significant interventions are made. This position paper outlines the critical insights and recommendations needed to address Africa’s energy deficiency while aligning with global decarbonization goals.
Demand is Outstripping Supply
Despite efforts to increase electricity access, Africa’s energy crisis is deepening. Population growth, coupled with economic challenges such as those brought by the COVID-19 pandemic, has reversed progress. In 2021, more people in sub-Saharan Africa were without electricity than in 2019, highlighting the urgent need for accelerated and sustained interventions.
The Energy Paradox
Africa is paradoxically rich in energy resources yet remains the most energy-deficient continent. The continent holds significant reserves of minerals critical for renewable energy technologies and vast oil and gas resources. However, these resources are primarily exported, with minimal benefits to domestic energy consumption. This export-oriented focus leaves African countries vulnerable to fluctuations in global demand and prices, undermining efforts to improve local energy access.
Infrastructure Deficiencies
Weak and ageing infrastructure is a major constraint on energy access in Africa. Countries like Nigeria and South Africa face frequent power outages due to grid instability and outdated systems. The investment required to maintain and expand infrastructure to meet growing demand is substantial, with estimates suggesting Africa will need $400 billion by 2050 for electricity transmission and distribution alone.
High Debt Levels
High levels of debt have significantly limited the capacity of African governments to invest in energy infrastructure. The average debt-to-GDP ratio in sub-Saharan Africa has doubled over the past decade, with rising debt servicing costs further constraining public finances. This financial strain hampers the ability of governments to prioritize energy sector improvements, which are crucial for economic development.
Public Utility Challenges
Public utilities in Africa often struggle with inefficiency, financial mismanagement, and corruption. In many countries, state-owned utilities monopolize the electricity sector, limiting private sector participation and innovation. Addressing these issues is essential for improving energy access and ensuring the financial sustainability of the energy sector.
Given the challenges with grid expansion, particularly in rural areas, decentralized energy solutions such as standalone solar systems and mini-grids should be scaled up. These systems offer a viable path to increasing energy access in remote regions where traditional grid expansion is not feasible.
African countries should explore strategies to retain more value from their mineral resources by developing local industries that can utilize these materials for renewable energy technologies. This approach could reduce reliance on exports and foster energy self-sufficiency.
Significant investments are needed to modernize and expand Africa’s energy infrastructure. International partnerships and financing mechanisms should be mobilized to support large-scale projects that can improve grid stability and reduce energy losses.
African governments must pursue strategies to manage and reduce debt levels, including restructuring existing debt and exploring innovative financing options for energy projects. International financial institutions can play a key role in providing debt relief or favorable loan terms tied to energy sector investments.
Comprehensive reforms are necessary to improve public utilities’ efficiency and financial health. This includes enhancing transparency, reducing corruption, and encouraging private sector participation in the energy sector. Public-private partnerships could offer a pathway to inject much-needed capital and expertise into the sector.
Achieving universal energy access in Africa requires a multifaceted approach that addresses supply-side challenges and the broader economic and structural issues hindering progress. Africa can meet its growing energy demands by prioritizing renewable energy solutions, leveraging local resources, and reforming the energy sector while contributing to global decarbonization efforts. The international community’s support is crucial in this endeavour, as Africa’s energy future will significantly impact global economic and environmental outcomes.
The writer is the Continental Coordinator, the African Energy Security Coalition
