Africa’s renewable energy revolution

African leaders need to consider the fact that one in three Africans, that’s 600 million people, has no access to electricity. Neither do some 10 million small and medium-sized enterprises. Those homes and businesses fortunate enough to have power pay three times as much as those in the United States and Europe; furthermore, they routinely endure power outages that cost their countries from one to four per cent in lost GDP every year.

Despite the fact that Africa is blessed with some of the world’s largest hydropower and geothermal resources (10-15 GW of geothermal potenteial in the Rift Valley alone), bountiful solar and wind resources, as well as significant natural gas reserves, total power generation capacity in Africa is about 80,000 megawatts (MW) (including South Africa), roughly the same as that of Spain or South Korea.

As Africa enters its 20th consecutive year of economic expansion, with the World Bank forecasting that Africa’s GDP growth will remain steady at 4.7 per cent in 2014, and strengthening to 5.1 per cent in each of 2015 and 2016, the continent needs more electric power. Specifically, Africa needs to add 7,000 MW of generation capacity each year to meet the projected growth in demand, yet it has achieved only 1,000 MW of additional power generation annually.

Abundant hydropower in Western Europe gave many countries the economic boost they needed to steadily raise their living standards and power new chapters in their drive for economic development. Hydropower gave Europe a powerful head-start on building affluence and progress. Like Europe and the rest of the world, Africa deserves the same opportunity to exploit this green source of power to improve the lives and economic prospects of its people.

Beyond building these power generation assets, they must be connected to the market, which calls for regional cooperation to build the transmission network. We are working with African leaders and their development partners, as part of our broader initiative of Regional Integration, to create power pools in Africa’s East, West, Central, and Southern sub-regions. Those countries with abundant geothermal, gas, hydro, solar, and wind resources can feed their excess power supply into a common pool, while neighbouring states with lesser endowments of energy resources and generation capacity can benefit from this integrated approach to delivering electricity to their people. It is incumbent upon the individual countries to remove all barriers to these cross-country investments. As noted by both the World Bank and Power Africa Initiative, the benefits of these investments in generation can only be harvested, and transferred to African consumers, if the distribution companies meet the minimum level of efficiency, financial viability, and good governance. The region’s electric utilities – whether they are state-owned or private enterprises – need to be operating at full capacity and undertaking the necessary reforms so as to bring the power to the people of Africa.

In East Africa, for example, the World Bank has mobilized $684 million to build the Eastern Electricity Highway Project (EEHP) to connect Ethiopia’s electrical grid with Kenya, and reduce energy costs and protect the environment while paving the way for more dynamic regional cooperation between the countries of East Africa.

Elsewhere in Africa, as world prices for photovoltaic equipment have fallen, solar power is an increasingly affordable option to add the continent’s energy mix.

In Mauritania, which is in the forefront of the renewable energy movement in Africa, solar energy now powers 30 percent of Nouakchott’s energy use, with 50 percent of the capital city’s energy needs likely to be covered by solar in the next several years. There is also significant potential for large-scale concentrated solar power arrays, as have already been constructed in Morocco.

Expanding Africa’s access to electricity through grid, mini-grid, and off-grid solutions is a key element of our efforts to achieve the twin World Bank Group goals of ending extreme poverty and creating shared prosperity for all people of the continent. Furthermore, by meeting electricity demand with our plentiful renewable resources – hydro, geothermal, solar and wind – Africa can grow in an environmentally sustainable manner, with minimal additions to overall carbon emissions. Africa is poised to achieve green growth – a global public good -- while meeting the energy needs and growth aspirations of its people.

Diop is the World Bank’s Africa Region Vice President