African
governments, investors and international financial institutions must
significantly scale up investment in energy to unlock Africa’s potential as a
global low-carbon superpower.
That
is the main message of a new report from Kofi Annan’s Africa Progress Panel; “Power,
People, Planet: Seizing Africa’s Energy and Climate Opportunities”.
The
report calls for a ten-fold increase in power generation to provide all
Africans with access to electricity by 2030. This would reduce poverty and
inequality, boost growth, and provide the climate leadership that is sorely
missing at the international level.
“We
categorically reject the idea that Africa has to choose between growth and
low-carbon development,” said Kofi Annan, Chair of the Africa Progress Panel.
“Africa needs to utilize all of its energy assets in the short term, while
building the foundations for a competitive, low-carbon energy infrastructure.”
In
Sub-Saharan Africa, 621 million people lack access to electricity – and this
number is rising. Excluding South Africa, which generates half the region’s
electricity, Sub-Saharan Africa uses less electricity than Spain. It would take
the average Tanzanian eight years to use as much electricity as an average
American consumes in a single month. And over the course of one year someone
boiling a kettle twice a day in the United Kingdom uses five times more
electricity than an Ethiopian consumes over the same year.
Power
shortages diminish the region’s growth by 2-4 per cent a year, holding back
efforts to create jobs and reduce poverty. Despite a decade of growth, the
power generation gap between Africa and other regions is widening. Nigeria is
an oil exporting superpower, but 95 million of the country’s citizens rely on
wood, charcoal and straw for energy.
The
report reveals that households living on less than US$2.50 a day collectively
spend US$10 billion every year on energy-related products, such as charcoal,
kerosene, candles and torches.
Measured
on a per unit basis, Africa’s poorest households are spending around US$10/kWh
on lighting – 20 times more than Africa’s richest households. By comparison,
the national average cost for electricity in the United States is US$0.12/kWh
and in the United Kingdom is US$0.15/kWh.
This
is a significant market failure. Low-cost renewable technologies could reduce
the cost of energy, benefiting millions of poor households, creating investment
opportunities, and cutting carbon emissions.
The
report says Africa’s leaders must start an energy revolution that connects the
unconnected, and meets the demands of consumers, businesses and investors for
affordable and reliable electricity.
The
ten-member Africa Progress Panel advocates at the highest levels for equitable
and sustainable development in Africa. The Panel releases its flagship
publication, the Africa Progress Report, every year.
The
2015 Africa Progress Report urges African governments to: Use the region’s
natural gas to provide domestic energy as well as exports, while harnessing
Africa’s vast untapped renewable energy potential; Cut corruption, make utility
governance more transparent, strengthen regulations, and increase public spending
on energy infrastructure; Redirect the US$21 billion spent on subsidies for
loss-making utilities and electricity consumption – which benefit mainly the
rich – towards connection subsidies and renewable energy investments that
deliver energy to the poor.
The
report also calls for strengthened international cooperation to close Africa’s
energy sector financing gap, estimated to be US$55 billion annually to 2030,
which includes US$35 billion for investments in plant, transmission and
distribution, and US$20 billion for the costs of universal access.
A
global connectivity fund with a target of reaching an additional 600 million
Africans by 2030 is needed to drive investment in on- and off-grid energy
provision.
Aid
donors and financial institutions should do more to unlock private investment
through risk guarantees and mitigation finance.
Time to end
‘climate negotiating poker’
The
report challenges African governments and their international partners to raise
the level of ambition for the crucial climate summit in Paris in December, and
calls for wholesale reform of the fragmented, under-resourced and ineffective
climate financing system.
G20
countries should set a timetable for phasing out fossil fuel subsidies, the
report states, with a ban on exploration and production subsidies by 2018.
“Many
rich country governments tell us they want a climate deal. But at the same time
billions of dollars of taxpayers’ money are subsidising the discovery of new
coal, oil and gas reserves,” Mr Annan said. “They should be pricing carbon out
of the market through taxation, not subsiding a climate catastrophe.”
While
recognising recent improvements in the negotiating positions of the European
Union, the United States and China, the report says that current proposals
still fall far short of a credible deal for limiting global warming to no more
than 2˚C above pre-industrial levels.
It
condemns Australia, Canada, Japan and Russia for effectively withdrawing from
constructive engagement on climate.
“By
hedging their bets and waiting for others to move first, some governments are
playing poker with the planet and future generations’ lives. This is not a
moment for prevarication, short-term self interest, and constrained ambition,
but for bold global leadership and decisive action,” Mr Annan said.
Mr
Annan added, “Countries like Ethiopia, Kenya, Rwanda and South Africa are
emerging as frontrunners in the global transition to low carbon energy. Africa
is well positioned to expand the power generation needed to drive growth,
deliver energy for all and play a leadership role in the crucial climate change
negotiations.”