A Roadmap to Prosperity (By Wale Shonibare) – Africa.com
By Wale Shonibare, African Development Bank (African Development Bank website) Director, Energy Financial Solutions, Policy and Regulation
Africa is blessed with bright sunshine and rich natural resources. Yet despite all this, there remains a pressing issue that threatens the continent’s growth and prosperity: the lack of reliable and sustainable electricity. As we prepare for the Africa Energy Summit (https://apo-opa.co/3PEPMUY) taking place in Dar es Salaam, Tanzania, from 27 to 28 January 2025, the urgency of addressing Africa’s energy needs cannot be overstated. Without power, Africa cannot realize its development aspirations and occupy its rightful place at the global table. This summit is a critical step towards unlocking Africa’s vast potential and empowering its people.
Energy poverty and the harsh reality of Africa’s power sector
Today, nearly 600 million Africans – about half the continent’s population – still lack access to electricity. For these people, daily life is a struggle illuminated by the dim glow of kerosene lamps or the intermittent hum of diesel generators. Not only are these stopgap measures costly, they also pollute and perpetuate a vicious cycle of poverty and environmental degradation. At the current rate of electrification and Africa’s rapid population growth, the number of people without electricity will remain essentially the same unless we take bold and immediate action.
The reason why this challenge is so significant in Africa is that for decades, the electricity sector has faced numerous interrelated challenges, including low access, lack of maintenance, lack of investment, non-cost-reflective electricity prices, unaffordable subsidies, and Lack of electricity etc. Financial sustainability. Most African utilities are in financial trouble – they struggle to cover their operating costs and cannot cover the capital expenditures needed to stay afloat, forcing them to rely on public subsidies.
At the same time, most financing for energy projects today is in hard currency, which is not always sustainable as energy services are paid for by local residents in local currencies, leading to currency mismatches caused by fluctuations in local currencies versus international hard currency. Furthermore, in most African countries, regulatory agencies are subject to political interference, which affects their decision-making and ability to implement policies that support long-term industry development.
I firmly believe that without access to reliable, affordable and sustainable electricity, Africa will not be able to achieve its development aspirations. Energy access is a cornerstone of economic transformation, creating opportunities for education, health, gender equality and income generation. This is a prerequisite for creating a green and resilient future where poverty becomes a thing of the past.
Task 300 (https://apo-opa.co/3PEPMUY): A bold vision for the future
To address this urgent need, the African Development Bank Group, the World Bank and other partners have launched an ambitious initiative called Mission 300 (https://apo-opa.co/3PEPMUY). The initiative aims to provide electricity to 300 million Africans by 2030. Mission 300 is not just a number; It represents life change, economic revitalization and community empowerment.
The plan focuses on accelerating electrification through a combination of grid extension and distributed renewable energy solutions such as mini-grids and stand-alone solar home systems. These solutions are particularly effective in reaching vulnerable and remote areas where traditional grid infrastructure is impractical. Complementing these efforts are investments in generation, transmission, regional interconnections and sectoral reforms to ensure that electricity supply is not only reliable, but also affordable and sustainable.
Partnerships and reform: keys to success
Mission 300 can only succeed with the combined efforts of governments, private sector stakeholders and international partners. Governments must take the lead in implementing key reforms to improve the efficiency of the energy sector and the strength of utilities. Transparent and competitive bidding processes for new generation generation capacity and cost recovery mechanisms for utilities are crucial. Regulators must adopt appropriate flexibility and innovation to respond to the rapidly changing technology and business environment. Governments and development partners must step up calls for regional power trade to facilitate a shift to a single-buyer model and allow variable renewable energy (VRE) to be sustainably integrated into weak grids to help shape African countries’ energy transition pathways .
Private sector engagement is critical to solving Africa’s energy challenges, especially given Africa’s rapid population growth and the need for increased investment. The private sector already plays a vital role in expanding access to renewable energy, particularly through decentralized energy solutions, an area where traditional utility-scale projects face constraints due to infrastructure constraints. At the same time, multilateral development banks and philanthropic organizations must step up to unlock private capital for the energy sector through targeted financing instruments, risk mitigation tools, technical assistance and policy advocacy.
The recently launched Technology Facilities Accelerator Fund (https://apo-opa.co/3CaOjmm) is a promising step in this direction, providing technical assistance to governments and helping to streamline the process of achieving Mission 300 goals.
Decisive moment: Africa Energy Summit
The upcoming Africa Energy Summit is a critical moment for the continent. Hosted by the Government of the United Republic of Tanzania, the African Union, the African Development Bank Group and the World Bank Group, the summit will bring together heads of state, energy experts and private sector leaders to create universal access to energy pathways.
At the summit, a number of African governments will present their national energy compacts, outlining their reform commitments and near-term actions to achieve their energy goals. The compacts will showcase the innovative strategies and partnerships being deployed to advance universal energy access in a reliable, affordable and sustainable way. The summit will also highlight the critical role of international partners such as the Rockefeller Foundation and Sustainable Energy for All (SEforALL) (https://apo-opa.co/40D8wdO) and the Global Energy Alliance for People and Planet (GEAPP), who are mobilizing resources and expertise to support this mission.
It is worth noting that the summit will announce some new spending commitments and innovative initiatives aimed at encouraging African countries to mobilize more domestic resources to fund the accelerated rollout of green energy infrastructure across the continent.
Why now?
The convergence of technological breakthroughs, digitization and innovative financing models makes now the perfect time to address Africa’s energy challenges. Achieving Mission 300 will not only shine a light on homes and businesses, but also drive progress in education, healthcare and gender equality. It will reduce emissions, improve welfare, boost income generation and financial inclusion across the continent.
As we gather in Dar es Salaam, let us be reminded that access to energy is not just a technical challenge; This is a moral imperative. By working together, we can transform Africa’s energy landscape and create a brighter, more prosperous future for millions of people.
Let’s make Mission 300 a turning point. Let’s secure 13 landmark contractual agreements (https://apo-opa.co/3C1OzUL) The agreement signed this week points the way to lighting up the rest of our continent.
Distributed by APO Group on behalf of the African Development Bank Group (AfDB).
About the African Development Bank Group:
The African Development Bank Group (AfDB) is Africa’s premier development finance institution. It consists of three different entities: the African Development Bank (AfDB), the African Development Fund (ADF) and the Nigeria Trust Fund (NTF). The African Development Bank operates in 44 African countries and has an external office in Japan, contributing to the economic development and social progress of its 54 regional member countries.
For more information: African Development Bank website
