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Renewables to Drive Power Generation Growth in Africa, IEA Says

Renewable energy will satisfy much of Africa’s expanding power needs by 2040 as the continent unlocks vast hydropower resources, the International Energy Agency said.

Energy demand south of the Sahara Desert will grow 80 percent as the economy quadruples in size during the period, the Paris-based institution said in a report released today. Renewable energy will supply almost half of the growth.

The findings are the most detailed study yet of Africa’s energy demand and suggest the continent will take “a major step forward” in spreading electricity to rural areas and bringing people out of poverty, the IEA said.

“Many governments are now intensifying their efforts to tackle the numerous regulatory and political barriers that are holding back investment in domestic energy supply,” the report said. “But inadequate energy infrastructure risks putting a brake on urgently needed improvements.”

The IEA, which advises industrial nations on energy policy also sketches the scale of the challenge in bringing the African continent closer to the energy standards enjoyed in industrial nations.

Sub-Saharan Africa accounts for 13 percent of the world’s population and 4 percent of energy demand. Only 290 million of the region’s 915 million people have access to electricity. Two thirds of the cash put into energy is for developing resources to export.

Energy Boom

Since 2000, energy use in sub-Saharan Africa has risen by 45 percent. The IEA expects the capacity of power generation connected to traditional grids to quadruple by 2040 from about 90 gigawatts today, about half of which is in South Africa. It expects more than a half billion people will remain without power in 2040.

Other renewable sources led by solar energy will also make a growing contribution to power supply. Only about 10 percent of the potential hydropower resources are being exploited now, the IEA said.

Large hydro and fossil fuel power plants will improve coverage in urban areas while other clean energy sources lead electrification in rural areas. Mini-grids and off-grid systems will provide power to 70 percent of those gaining access in rural areas, of which two-thirds will be powered by solar, wind and small hydroelectric plants.

Those technologies are becoming more attractive against diesel generators because of their falling costs, the IEA said.

Copyright 2014 Bloomberg

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