Access to Electricity is Critical to Africa’s Growth

As Africa thrives under surging economic and population growth rates, we face the challenge of ensuring that everyone benefits optimally from the gains of development. Utilities are key to growth. Their provision—or the lack of—can make the difference between life and death, between a prosperous society with expanding opportunity, and one where people struggle with poverty and vulnerability.

Electricity can increase household per capita income by 39 percent. Businesses operate at higher levels of productivity, farmers can run cleaner irrigation systems and processing machines that improve their yields and thus, their income. In rural communities, the farmer who once lost half of her produce due to inadequate climate controlled storage solutions, suddenly reduces her losses while increasing her income when she gains access to electricity and refrigeration. She can then have better nutrition from her subsistence farming, invest more in education, health, and the general well-being of her family and community. With eighty percent of Africa’s economy relying on agriculture, imagine the total impact on farmers’ lives if they all had access to electricity, how it would impact their yields and translate into greater economic growth.

“There are about 1.3 billion people without reliable power sources globally, most of them in Africa and Asia.”

According to the World Bank, there are about 1.3 billion people without reliable power sources globally, most of them in Africa and Asia. This translates into 600 million people—70 percent of the population of sub-Saharan Africa—without electricity, which is critical in powering water supplies, telecommunication services, and strengthening health care delivery services. Access to power catalyzes economic development in rural areas and creates more jobs and new industries. Children’s interest and performance in school improve. Households have fewer respiratory ailments and accidents. And women feel safer and more mobile, especially at night.

In an ideal world where we have access to these critical utilities, we would meet our development targets very easily. However, this is not the case. I recently spoke at the African Utility Week and shared six ideas on our quest for reliable utilities in Africa:

• We need more innovative approaches and partnerships such as Smart Power for Rural Development, a $75 million initiative we launched this April with local and national NGOs, industry leaders, and government actors. The initiative pursues a solution that promotes decentralized, renewable energy mini-grids—installations that generate and distribute electricity to serve thousands of rural Indian households.
• Innovative partnerships will help increase water, electricity, and telecommunications coverage by offering methodologies for liaising with poor communities to develop demand-responsive infrastructure services, and for monitoring service expansion programs.
• Philanthropic organizations like ours, with risk capital for investment, should support public-private partnerships, de-risk innovative ideas to catalyze greater commitment by others, and in turn create greater impact for all of our development initiatives.
• Electrification should be a key part of African governments’ economic development agenda. They have a key role in aligning policies to build an enabling regulatory environment in support of the creation of markets for mini-grids; to increase opportunities for interactivity between mini-grids and the national grid; to ensure budgetary allocation to enable this; and to develop expansion programs with committed funding streams.
• Africa relies heavily on wood or other biomass for cooking and heating, a cause of outdoor and indoor air pollution, wreaking havoc on our health and the environment. We need to tap into alternative energy sources by investing more in solar technologies, clean energy, affordable smart meters, and more efficient battery storage. Off-grid solutions will decrease our high dependence on fossil fuels, which makes it expensive to generate and provide electricity.
• We need to invest in a skills revolution to enable us exploit these alternative sources, through training in relevant technical expertise.

Today, there is a growing global movement of investors interested in what Africa has to offer: entrepreneurs, companies, and impact investors looking for new sectors, opportunities, and markets. As we flow in this current of growth, we must bear in mind that if Africa is to meet the UN Sustainable Development Goals—and to be transformed holistically—we will need to cater to the role utilities play.