Creating a Profitable Balance
Capturing the $110 Billion Africa Power-Sector Opportunity with Planning
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More than 600 million people across sub-Saharan Africa lack access to reliable electricity, creating significant cost for homes, businesses, and utilities. Understandably, this has translated into aggressive national installed capacity targets, with nations across East and West Africa aiming for increases of between 1.3 and eight times by 2020.
Our analysis of only those projects very likely to be completed by 2023 suggests that the cost of capacity imbalance will exceed $180 billion, or more than two-and-a-half times the 2016 gross domestic product of Kenya.
Fortunately, there is a simple solution that reduces costs, frees up capital for other urgent needs, makes electricity more affordable, and ensures continued strong investment in the region. Taking a plan-based investment approach in the power sector will save more than $110 billion across East and West African nations if planned investments are changed from 2023 on. If more immediate action were taken, the value of planned-based investments would rise by an additional $68 billion to over $180 billion.