Unlocking Africa’s energy potential: The finance imperative

From the Executive Director

Dear Friends,

Greetings from the secretariat of the Africa Progress Panel.

It has been an incredible few months. The launch of our 2015 report, Power, People, Planet: Seizing Africa’s Energy and Climate Opportunities, met with great success. I am very grateful for the extensive support that we received from countless people and institutions. A wide range of voices is crucial to help us spread the report’s messages and change policies.

The launch took place at the World Economic Forum Africa, in Cape Town. (You can see a video of the launch here.) Panel members Michel Camdessus, Graça Machel and Linah Mohohlo delivered the report’s key message: that Africa has a chance to show the way to a low-carbon future – while putting in place the policies needed to reduce its vulnerability to the effects of climate change.

Our Panel members have been very active. Kofi Annan and Bob Geldof spoke on BBC Newsday, and Graça Machel and I spoke on CNBC Africa. The Washington Post published an opinion article by Kofi Annan and Robert Rubin, and Business Day Africa an opinion article by Michel Camdessus and Linah Mohohlo.

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We have had substantial media impact in many countries and the report continues to be cited extensively. At the policy level, we are finding that the report’s narrative is very timely; we have already gained much traction in our discussions with diverse policy makers and influencers.

The widespread impact of the report via our social media platforms reflects that the messages in the report are resonating deeply. The statistics are revealing. Over a period of just 10 days at the time of the report launch:

– On Facebook, our launch campaign was seen by over 7.1 million people. Kofi Annan’s video was viewed 207,000 times and our seven mini videos were viewed 410,000 times combined. In total, our video content for the campaign over the ten days was viewed 616,000 times.
– On Twitter, the launch campaign was seen by over 4.5 million people. Kofi Annan’s video alone reached 1.8 million people, with 35,200 people watching it. The video was also retweeted over 3,700 times and favourited over 2,700 times. Our campaign was listed as a “creative win” by Twitter on their official blog.

In total, the 10-day campaign reached over 11.6 million people through social media, with the launch video alone reaching over 2 million people. Over 60,000 people downloaded the report within the first five days.

I would encourage you to look at Kofi Annan’s video and share it as much as you can. Thanks!

We are now spreading the key messages of our report by reaching out to policy makers across the globe. We work in many different ways, including mobilizing and convening key influencers, promoting policy messages across diverse groups, as well as undertaking strategic discrete interventions.

Our next stop is the Third International Conference on Financing for Development, in Addis Ababa, which takes place this week. Much is at stake. The aim of this meeting is to contribute to and support the implementation of the post-2015 development agenda.

A critical focus of the meeting in Addis will be financing energy in Africa, where 621 million people lack access to electricity.

Africa’s energy challenges are immense. 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.

Energy-sector investment in Sub-Saharan Africa is inadequate, at only US$8 billion a year or 0.4 per cent of gross domestic product. A ten-fold increase in power generation is needed to achieve the United Nations sustainable development goal of universal access to energy by 2030; if current trends continue, the goal won’t be reached until 2080.

Africa’s energy financing gap – the extra investment it needs to bring modern energy to all – stands at $55 billion per year until 2030. That sounds like a large sum, but it would deliver high social and economic returns. Our report outlines how governments, private investors and aid agencies could mobilize the finances needed to bridge the gap.

For example, African governments could increase tax revenues to cover almost half of the amount. They could also cut corruption, make utility governance more transparent, strengthen regulations, and increase public spending on energy infrastructure. The US$21 billion spent on subsidies for loss-making utilities and for electricity consumption – which benefit mainly the rich – could be redirected towards connection subsidies and renewable energy investments that deliver energy to the poor.

Strengthened international cooperation is essential to close Africa’s energy sector financing gap. A more efficient and equitable global tax system would contribute substantially. The current system allows global companies to dodge their tax obligations. Stemming illicit financial flows from Africa, which stood at US$69 billion in 2012, would also make a difference.

Once strong global development goals are in place, backed by smart financing and a fair climate deal, African countries will be in a better position to transform their economies. In fact, Africa’s leaders have an amazing opportunity to show the rest of the world the way to a sustainable future. Africa can leapfrog over the damaging energy practices that have brought the world to the brink of catastrophe.

If financed correctly, Africa can both grow and show the way, by embracing a dynamic energy mix. And the continent’s energy potential will transform lives.

Caroline Kende-Robb

Caroline Kende-Robb served as Executive Director of the Africa Progress Panel from September 2011 to January 2017.

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