By Judith Pryor
Vice President, Office of External Affairs, Overseas Private Investment Corporation
There is a popular satellite photo of the earth at nighttime that really captures the severity of Africa’s power shortages. While much of the rest of the world shines brightly, the African continent sits mostly in darkness. It is easy to look at that image and conclude that the challenge of such widespread energy poverty that has left hundreds of millions of people in the dark is almost too daunting to address. But when I travel to Africa, see its vast natural resources, meet its enterprising people, and visit some of the power projects that OPIC has helped support, I get really excited about Africa’s future.
During my most recent trip to Africa, I visited the Olkaria geothermal power plant in Hell’s Gate National Park in Kenya, which was recently expanded with the help of an OPIC loan. Olkaria is probably not what you think of when you think of a power plant. First time visitors may be more likely to notice the zebras and giraffes wandering around, but in fact, this is the site of abundant hot springs and volcanoes, which are tapped to produce electricity. Hot steam is transported from the site via pipeline, which has even been elevated in places to make way for migrating giraffes. Only in Africa, you might say! Olkaria has significantly expanded Kenya’s electricity supply and helped it to generate more than 12 percent of its electricity from geothermal power. Impressive, yes, but the Kenyan government plans to get more than a quarter of its national energy supply from geothermal by 2030.
With a long history of supporting electricity plants in Africa, from Kenya to Togo, OPIC understands that powering Africa is not only possible, it is a major business opportunity for U.S. businesses like Nevada-based Ormat Technologies Inc., which operates the Olkaria plant in Kenya. We work to catalyze the private sector investment that is essential to getting such high cost, complex projects off the ground and seeing them through to completion — and we are looking forward to playing a key role in President Obama’s Power Africa initiative, which aims to double access to power on the continent.
My recent trip to Kenya coincided with a visit from several congressional staff members researching legislation to solidify the U.S. commitment to Africa’s energy access. I was happy to be able to show them the Olkaria plant, which is delivering electricity to millions of Kenyans, while also creating jobs in both Kenya and the U.S. In fact, the plant manager who showed us around the rural Kenyan facility was an Ormat employee from Nevada. Supporting investments that bring economic benefits to both the host countries and to the U.S. is at the heart of OPIC’s work.
In addition to our work in Kenya, OPIC supports power projects in other Sub-Saharan African countries, like Tanzania and Togo. And we are eager to do more. While Africa has seen significant economic progress in recent years with many countries enjoying growth rates that are among the highest in the world, this progress is limited by severe power shortages. More than half the population of Sub-Saharan Africa — about 600 million people — lack a regular source of electricity. That’s about equivalent to the population of all of Western Europe plus Japan and South Korea, and this many people living without power greatly limits productivity, agricultural production, the delivery of quality healthcare, small business activity and many other aspects of life and work.
Africa’s energy future will be assisted by the Power Africa initiative, and also by cooperation between African governments to build regional lines of transmission to bring power from the source to underserved populations. The way I see it, this next-step infrastructure is not an obstacle, but another opportunity for OPIC and our Power Africa partners to mobilize even more private sector investment.
OPIC supports many renewable power projects like wind, solar, geothermal and biomass, and also recognizes that traditional thermal power sources will be essential to illuminating this continent. As the Olkaria geothermal power plant in Kenya shows, there are multiple ways to bring power to Africa.