The International Energy Agency (IEA) has just released a report emphasising the urgent need for substantial investments in clean power projects to address Africa’s surging energy demand.
The report states that meeting Africa’s growing energy needs will require more than doubling current annual investments. A significant focus on clean technology is essential to these investments. To achieve this, the report calls for swift action to overcome financial barriers and ensure that investment reaches the necessary levels.
Between now and 2030, a sizable investment will be needed to connect all African homes and businesses to electricity. Despite Africa’s significant resources, the continent still faces energy poverty, with approximately 600 million Africans lacking access to electricity and over 1 billion relying on traditional methods such as open fires and wood, charcoal, kerosene, coal, and animal waste for cooking.
The report also highlights the affordability challenges faced by many households. Currently, only half of the households without electricity access can afford basic energy services without additional financial support. Fewer could still afford modern cooking solutions. This lack of reliable and affordable energy hampers agricultural productivity. It also impedes industrial growth and limits the ability of countries to attract and develop new sectors of their economies.
Investments in the energy sector across the continent have been declining since their peak in 2014. In fact, it is currently down by 34%. Concessional capital from international sources will be crucial for mobilising an increase in funding. Approximately $30 billion per year will be needed between now and 2030 for clean energy projects to attract commercial funding.
