Getting to dawn in Sub-Saharan Africa: OPIC’s Whalen on the changing investment climate on the continent
OPIC Vice President, Structured Finance, Michael Whalen wrote about Africa’s energy deficit in Project Finance International’s 2014 Yearbook, where he said that an improving investment climate and the U.S. Power Africa initiative have created momentum for increased electrification “after years of missed opportunities.”
“For a long time global appetite for project finance in Africa was strongly concentrated in natural resource production and processing,” Whalen wrote. “…The recent past has shown a shift away from that trend and suggests the future may be quite different for Africa.”
Whalen also stressed that while Power Africa’s goals of doubling access to electricity on the continent are ambitious, “they are ultimately only a down payment to the more than $300 billion in investment estimated by the International Energy Agency as being required for Africa to achieve universal electricity access by 2030.”
Whalen provided this graphic that shows installed electricity capacity in different African countries, plotted against population and GDP. While the Power Africa focus countries are distinguished by color, it is important to note that OPIC’s pledge to the initiative spans the continent.
Whalen also offered some context on the data: “Describing Africa’s energy consumption in terms of gigawatts tells part of the story but it may not adequately express how much all aspects of life and work across the continent are constrained by such limited power supply.” He said that the per-capital energy consumption for residents of Sub-Saharan Africa is roughly the equivalent of a single standard light bulb providing four hours of illumination per day for a year.”
This shortage, he said, “limits agricultural production, the delivery of quality healthcare, small business activity and overall economic growth.”