A new report called “POWER PEOPLE PLANET Seizing Africa’s energy and climate opportunities” published by the Africa Progress Panel offers insights into the enormity of the energy challenges Africa faces. For example, there are 138 million households with people living on less than $2.50 per day, who spend $10 billion per year on energy related expenses such as kerosene, charcoal, candles and firewood.
This is the equivalent of approximately twenty times what American and UK citizens spend – Africans spend $10 per kWh wheras the average price that American pay is $0.12 per kWh and Brits pay $0.15 per kWh.
By electrifying those households, they could immediately save $8 billion per year. That would take between 16 and 26 million people out of poverty.
The report says that it would require investment into power systems from current levels of $8 billion per year to at least $55 billion per year or 3.4 percent of Africa’s GDP in 2013. One wonders what the world is waiting for. I can’t think of a greater market failure.