A better path for Africa’s energy future

PUBLISHED: Fri, 26 Jan 2018 18:10:49 GMT

By Rachel Kyte, CEO and Special Representative of the UN Secretary-General for Sustainable Energy for All

Africa Rising is Africa’s clarion call for economic development across the continent and the rest of the world. With the economic case for expanding access to clean, reliable affordable electricity never stronger, 2018 is a year where we should see breakthroughs.

Sustainable Energy for All is working with partners across Africa to strengthen data and evidence to support government policymakers to shift towards more integrated energy plans that promote electricity access and exploit the remarkable plunge in renewable energy prices. We have also tracked the amount of finance flowing to close energy access gaps – hint, not enough is landing in African countries with the largest gaps in a form or a price that is useful. African governments are not investing enough in their own energy future, either.

The bad news then is that there is much to do. The good news is that it’s all within our reach. Across the continent, we see examples of policy reforms that are working, investment climates that are attracting long-term financing and innovation that is poised to grow exponentially. The priority for 2018 must be speed and scale.

Consider the positives – the trends that we must seize on:

  • Solar and wind energy costs are plummeting, as are the costs of storage which opens more opportunities to deploy these technologies together.
  • More commitments by African leaders, including in Ethiopia, Ghana, Rwanda, Senegal and Zambia, to prioritise making reliable, affordable and clean energy available to all, especially remote and marginalised populations.
  • Financial innovation backing clean energy growth and development, such as Nigeria’s first-ever green bonds and the African Development Bank’s new lending for off-grid electricity and partnerships to mobilize blended finance.

With all that in mind, here’s are a few no-regret measures for 2018 that can help move us along even faster toward a sustainable energy future for all.

  1. Embrace integration: Government leaders in Africa have a golden opportunity to re-think their national electrification strategies. Embracing integrated strategies, using both centralized and decentralized energy sources, will allow for a speedier and cheaper pathway to close energy access gaps, especially in rural area where grids are still a distant prospect.
  2. Embrace the moment: Across the world, we are seeing low auction prices for renewable energy projects. The IFC-backed Scaling Solar program helped Zambia secure solar at 6 cents per kilowatt hour, the lowest solar prices to date in Africa. Others can learn from the success of Chile, Argentina and India, as well as South Africa, as they embrace grid connected renewables, and have effectively used power purchase agreements (PPAs) with transparent processes to attract long-term investors.
  3. No more harmful subsidies: Don’t subsidize dirty energy for poor people; subsidize clean energy services for the poorest. Move more quickly to remove harmful fossil fuel subsidies and put in place systems that support those on low incomes to access clean cooking fuels and electricity. Those who have done it or who have experimented, from Morocco to Malawi, from Indonesia to Mexico to Angola, can be sources of inspiration and confidence.
  4. Lay the table: The recent RISE report showed that African countries lagged behind their Asian peers in having supportive policy environments for attracting more renewable energy, energy efficiency and greater energy access. Among those moving to improve the fastest are Kenya and Morocco, which have made strong progress in recent years enabling grid-scale and decentralized renewable efforts to flourish. Replicating these successes, as well as ensuring that national investment climates are sound, is essential to increase financial flows into what should be a growth sector – a 600 million person market of low income Africans who don’t have energy services today.
  5. Don’t forget clean cooking: While finance flows for electricity access in Africa are weak, investment in clean cooking solutions is nearly non-existent, according to our recent research. It’s time to build big markets for clean cooking fuels in place of charcoal and other traditional biomass fuels whose use kills millions of people worldwide every year. Governments such as Rwanda’s, that have made clean cooking a high priority will benefit from a growing coalition of organizations and businesses who are scaling use of clean fuels, including with fuel pellets and liquid petroleum gas.

Africa is at a crossroads on energy. For many decades, the path of choice for closing energy access gaps in Africa was centralized fossil fuel projects and costly distributed diesel and kerosene. Yet, after all that investment, Africa’s energy is not reliable and affordable enough – and far too many people are still in the dark with no power at all.

Today, there is a better path, and many are showing the way with more renewables into electric grids; a stronger embrace of off-grid solar for household access; and subsidy reforms. By embracing a viable, clean energy future, not a myopic dirty past, African governments can leapfrog into a new energy future and make Africa Rising a reality.

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