Op-Ed: This is how Africa can accelerate energy access

By Mansoor Hamayun, Chief Executive, Bboxx and Adjadi Bakari Shegun, Senior Energy Advisor, Government of Togo

The scale of our global challenges is so significant and we really need to think about the how in meeting the Sustainable Development Goals (SDGs) as time is running out and we have less than 10 years to act.

In order to achieve our common goal of combatting energy poverty, it is crucial that the industry and governments come together to adopt new ways of accelerating energy access.

We are working to solve a major problem: energy poverty. Currently, 850 million people live without access to energy, of which 650 million are in Africa. An additional billion people are connected to an unreliable grid.

So, in order to close the energy access gap, we are today calling on the sector to adopt new ways of accelerating the pathway towards energy access as means to alleviate poverty and to unlock the potential of citizens, communities and countries. This marks a concerted push towards achieving SDG7 – for affordable, reliable and sustainable energy – over the next decade, and is the main driver to tackling in particular, SDG1, no poverty but also SDG8, decent work and economic growth and SDG13, climate action, among others.

As we firmly set our sights on positively impacting more people, partnerships with governments, manufacturers, distributors, investors and more are integral to this next chapter.

We first partnered one year ago on the CIZO project which has really showed the impact of subsidies to help increase energy access and reach the poorest. What makes the CIZO project unique is the use of mobile money, remote monitoring data and direct payment to customers. It allows full transparency. Customers know the real cost of a service and can choose with which company they want to use the subsidy money.

The Government of Togo translated that ambition into money and funded the CIZO project themselves as the development community was unwilling to do so, their requirements were not fit for purpose, or frankly they were just too slow to help achieve the SDGs by 2030.

So how do we make subsidies scalable?

The only answer is if subsidies are no longer a cost but an investment − that investors providing the subsidy could get a return. Without subsidies, we can’t reach everyone and the planet will miss meeting the Sustainable Development Goals by 2030.

This why the Affordability Accelerator Fund has been born. It will transform subsidies into an investment class. It achieves this through the operator sharing a percentage of its revenue back to the Affordability Fund that provides the subsidy.

Why should an operator share a percentage of its revenue back to the Affordability Fund? Because it helps the operator increase the size of its market, decrease the credit risk and ultimately generate value for its shareholders. For that the Affordability Accelerator Fund deserves a percentage of the revenue. The Affordability Fund solves the issue of the gap between economic output of a solution and the time it takes until it becomes productive.

With the right capital structure, the Affordability Accelerator Fund could also allow a certain proportion to be raised using sustainability bonds.

We are working together to make this a reality this year. We encourage the development world and others to join us. It’s not just for us, it’s for the entire sector from solar home systems to minigrids and even beyond. We need all of us and more to hit the Sustainable Development Goals by 2030. In the future we are sure this concept can be extended to other SDGs as well.

Our partnership on the Affordability Accelerator Fund was announced at GOGLA, the Global Off-Grid Solar Forum, in Nairobi. It is a clear response to GOGLA’s Market Trends Report which highlights the current $11 billion affordability gap, estimating that the sector would need to grow at an accelerated rate of 13%, with up to $7.7 billion in external investment to companies and up to $3.4 billion of public funding to bridge that gap.

We therefore look forward to collaborating with more partners across the industry and using this innovative model as a catalyst for change.

This approach would enable subsidies to reach everyone, with subsidies becoming an investment and structuring the capital to allow it to scale to billions of people which is what is needed to end energy poverty. And this is what the world needs to end poverty as a whole.

Related Content

Cannon Asset Managers CEO on how to position your portfolio for a depression

In 2006, little known economics professor Nouriel Roubini warned that the US housing market was at risk of collapsing. Fast forward two years and it did, triggering the global financial crisis. Roubini, now known is Dr Doom is forecasting another economic depression, contradicting the consensus view the recovery from Covid-19 will be V-shaped. Dr Adrian Saville, CEO of Cannon Asset Managers joins CNBC Africa for more.

How Covid-19 is driving demand for internet services

With students working from home, companies across industries forced to move online and video conferencing services being more utilized now than ever; broadband, WiFi and mobile data capacity seems to be getting tested like never before. So can internet service providers stand up to the test? Robert Nkeramugaba, Senior Network Operations Manager, BSC joins CNBC Africa for more.

Uganda moves to phased reopening amid rising of COVID-19 cases

In Uganda, according to president Yoweri Museveni, the country will go ahead with its plan to re-open the country despite recording more than 150 Covid-19 cases in three days. Moreover, European Union gives Uganda about $198 million to fund coronavirus response. CNBC Africa spoke to Qatahar Raymond Mujuni, a journalist for more.

COVID-19 lock-down: Rwanda permits taxi-moto operations & inter- provincial travel

This morning it was announced that taxi motos are now permitted to accept passengers again after over two months of being off the road due to the dangers around the spread of Covid-19. This is good news not only for many of the 45,000 taxi-motorists in the country that depend on the income, but also for the thousands of citizens that they transport daily. CNBC Africa spoke to analyst, Moses Gahigi for more.

Subscribe to our newsletter

Sign up for free newsletters and get more CNBC AFRICA delivered to your inbox

More from CNBC Africa

When a barrel of oil was cheaper than your coffee | CNBC International

Demand for oil has fallen to unprecedented levels, resulting in oil prices turning negative for the first time in history. From the price war between Saudi Arabia and Russia to the pandemic, CNBC’s Nessa Anwar explores what this might mean for the commodity in the long-term. ----- Subscribe to us on YouTube: http://cnb.cx/2wuoARM Subscribe to CNBC International TV on YouTube: https://cnb.cx/2NGytpz Like our Facebook page: https://www.facebook.com/cnbcinternational Follow us on Instagram: https://www.instagram.com/cnbcinternational/ Follow us on Twitter: https://twitter.com/CNBCi...

COVID-19: Reopening aviation in South Africa

South Africa’s aviation sector partially reopened from Covid-19 lock-down’s this week, with the resumption of domestic business travel being allowed to take off. To understand what steps have been taken to maximise passenger safety at the country’s airports we speak with Refentse Shinners, Group Executive of Corporate affairs at the Airports Company of South Africa.

What It’s Like To Be A Professional Amazon Reviewer

Sean Cannell makes tens of thousands of dollars a month as a professional Amazon reviewer. As part of the Amazon Affiliate program, Cannell reviews camera gear on his Think Media YouTube channel and makes a cut of every sale those reviews generates o

Rebuilding South Africa’s construction sector

The COVID-19 pandemic, coupled with South Africa’s slowing economy has created a double setback for the construction industry. That’s according to financial services group Old Mutual. Last month construction firms, Group Five and Esor, both in business rescue announced that they would be delisting from the JSE. Today, WBHO warned annual profits would plunge 150 per cent, reflecting the impact of the Covid-19 lock-downs. Ian Woodley, Analyst: Old Mutual Equities and Arthur Karas, Portfolio Manager: Old Mutual Investment Group Macro Solutions join CNBC Africa for more.

Partner Content

Sanlam Emerging Markets and its partners on the African continent invest over $12 million to fight COVID-19

As we go through this global pandemic together, it is the little things we miss. A high five, a handshake, a walk...

VIVO CEO is a dynamic leader for this innovative global brand

May 2020 -- Six months ago the vision for vivo in South Africa was just beginning to...

Trending Now

Is there space for specialty items in post-Covid-19 Rwanda?

The Kigali Farmers and Artistans Market is a monthly event which brings over 250 independent vendors together to create a shopping opportunity for items such as handmade art, clothing and accessories; juices, natural cosmetics, artisanal food items, and fresh produce. By now the event should not only have expanded to Mombasa, but this month would've been their 3 year anniversary. Now with over 2 months out of commission, what have they done to survive? And will there be a market for what they offer when they return? Kigali Farmers and Artistans Market Founder, Florence Mwashimba joins CNBC Africa for more.

Nokanda becomes first locally made App to rank #1 on Google Play Store Rwanda

This week, Made in Rwanda cashless payment app, Nokanda, a product of software company, Hexacomb; rose to the number one spot on Google Play Store’s, “Top Free” category in Rwanda. The ranking, which often belongs to social media giants such as, WhatsApp and Facebook reflects a change in priorities for mobile users in the country. CNBC Africa spoke to Ernest Kayinamura, founder and CEO of the company for more.

Jack Ma Foundation on how the COVID-19 crisis is driving innovation in Africa

As soon as the first cases of COVID-19 were announced on the continent, The Jack Ma Foundation was one of the first responders in providing PPE aid support to all African countries. Jean Pau a Senior Advisor for International Programs at Jack Ma Foundation spoke to CNBC Africa's Armold Kwizera on the philanthropic decisions of the foundation.

How COVID-19 is impacting education outcomes in the Commonwealth

The Commonwealth of Learning was created by the Commonwealth Heads of Government in 1987 to promote the development and sharing of open learning and distance education knowledge, resources and technologies. As the world grapples with the COVID-19 pandemic, we find out what this means for the future of education. Asha Kanwar, President & CEO, Commonwealth of Learning joins CNBC Africa’s Kenneth Igbomor for this discussion....
- Advertisement -