fbpx

Private Sector Could Own More Than Half African Power Generation By 2025

Private Sector Could Own More Than Half African Power Generation By 2025

Africa Solar Power

East Africa’s first giant solar power field in Rwanda (Photo: Youtube/gigawattglobal.com)

From VOANews. Story by Reuters.

Africa’s installed power-generation capacity is expected to quadruple from 90 gigawatts in 2012 to 380 gigawatts in 2040, boosted by private investment, green energy initiatives and cross-border energy trade.

Three-quarters of respondents in a PricewaterhouseCoopers (PwC) survey said there was “a medium to high probability that the private sector will own and operate” more than half of African power generation projects by 2025.

PwC surveyed 51 senior officials from governments, power utilities, regulators and independent power producers in some of the worst affected countries in Africa, where electricity constraints cause frequent power cuts and dent economic growth.

“They felt that there are a lot of opportunities for Africa to leapfrog forward,” said Angeli Hoekstra, PwC’s Africa Power and Utility leader, who presented the findings of the first Africa Power and Utilities Sector Survey.

The investment required to improve electricity access in Africa will be “immense,” and the continent needs about $450 billion over the next 25 years to electrify all urban areas, the report said.

Respondents said they hope private sector investments will help improve power production, noting that access to funding for new capital projects is a problem. They cited a lack of regulatory change, the “failure to implement cost-reflective tariffs and overall difficulty of raising finances” as barriers to investment.

“In Africa, the challenges of financing infrastructure are compounded by limited institutional capacity, fragmented regulatory systems and often underdeveloped banking and capital markets outside of the larger economies of South Africa and Nigeria,” the survey said.

Hoekstra said governments hoped to take advantage of cost reductions in green energy generation.

“Security of supply and affordability will remain the main areas of focus for Africa now and in five years’ time,” he said.

Power cuts will be an “exception rather than the norm” by 2025, according to 96 percent of survey respondents from the following countries: Nigeria, South Africa, Zambia, Kenya, Mozambique, Botswana, Lesotho, Namibia, Uganda, Swaziland, Ghana, Malawi, Rwanda, Tanzania and Zimbabwe.

Read more at VOANews.