Power Cuts Becoming ‘Exception’ in Sub-Saharan Africa

REUTERS

Power cuts in 15 Sub-Saharan African countries could become an exception rather than the norm in 10 years, with private capital expected to play an increasingly bigger role, PricewaterhouseCoopers (PwC) said in an August 2015 survey.

Africa’s 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, the survey showed.

Three-quarters of respondents said there was “a medium to high probability that the private sector will own and operate” more than half of power-generating projects by 2025. The continent needs about $450 billion over the next 25 years to electrify all urban areas, the report said.

“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.

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 hamper 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, presenting the findings of the first Africa Power and Utilities Sector Survey.

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

The survey found that 96 percent of the officials from Botswana, Ghana, Kenya, Lesotho, Malawi, Mozambique, Namibia, Nigeria, Rwanda, South Africa, Swaziland, Tanzania, Uganda, Zambia and Zimbabwe believed power cuts will be an “exception rather than the norm” by 2025.