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| Will Barack Obama's Power Africa turn the lights out on energy poverty? | Will Barack Obama's Power Africa turn the lights out on energy poverty? |
| (3 months later) | |
| On Sunday, standing in the shadow of the Ubungo power plant in Dar es Salaam, Barack Obama launched a multi-billion dollar effort to "plug Africa into the grid of the global economy". | On Sunday, standing in the shadow of the Ubungo power plant in Dar es Salaam, Barack Obama launched a multi-billion dollar effort to "plug Africa into the grid of the global economy". |
| At face value, the US president's Power Africa initiative is welcome. It's an ambitious, aspirational commitment to "double access to power in sub-Saharan Africa". No doubt action is needed – if trends continue, more people in Africa will be without access to modern energy services in 2030 than today. Obama prioritising energy is therefore cause for celebration. | At face value, the US president's Power Africa initiative is welcome. It's an ambitious, aspirational commitment to "double access to power in sub-Saharan Africa". No doubt action is needed – if trends continue, more people in Africa will be without access to modern energy services in 2030 than today. Obama prioritising energy is therefore cause for celebration. |
| But what can be done to ensure that the potential of Power Africa is realised – that it delivers for poor people across the continent rather than for the portfolios of US exporters, such as General Electric? | But what can be done to ensure that the potential of Power Africa is realised – that it delivers for poor people across the continent rather than for the portfolios of US exporters, such as General Electric? |
| Striking a balance | Striking a balance |
| Rightly, the initiative recognises the importance of off-grid solutions in Africa's sustainable energy future. But of the $7bn dedicated to Power Africa over the next five years, the amount allocated to decentralised solutions looks disproportionately small. Establishing a $2m off-grid fund will do little to address the policy, finance and capacity challenges – such as ease of doing business, availability of startup capital, or the absence of a rural energy agency – of scaling up off-grid options, including micro-hydro schemes and solar home systems. International Energy Agency modelling gives equal priority to on- and off-grid energy investment (pdf) as it estimates that, to reach universal energy access by 2030, 55% of new connections will need to be off-grid. | Rightly, the initiative recognises the importance of off-grid solutions in Africa's sustainable energy future. But of the $7bn dedicated to Power Africa over the next five years, the amount allocated to decentralised solutions looks disproportionately small. Establishing a $2m off-grid fund will do little to address the policy, finance and capacity challenges – such as ease of doing business, availability of startup capital, or the absence of a rural energy agency – of scaling up off-grid options, including micro-hydro schemes and solar home systems. International Energy Agency modelling gives equal priority to on- and off-grid energy investment (pdf) as it estimates that, to reach universal energy access by 2030, 55% of new connections will need to be off-grid. |
| Services not just supply | Services not just supply |
| Big grid generation alone will not end energy poverty. Nor will the traditional emphasis on energy supply. Connection to the grid does not equate to energy access unless it is reliable and people can afford to meet their energy needs, including lighting, heating, cooking and communication. Planning and measuring progress therefore needs to focus on access to energy services, not connections to energy supplies. | Big grid generation alone will not end energy poverty. Nor will the traditional emphasis on energy supply. Connection to the grid does not equate to energy access unless it is reliable and people can afford to meet their energy needs, including lighting, heating, cooking and communication. Planning and measuring progress therefore needs to focus on access to energy services, not connections to energy supplies. |
| This service-focused approach has been championed by the UN sustainable energy for all initiative through the global tracking framework, which sets out a new way of defining and delivering energy access. Power Africa runs the risk of being an innovative mechanism using an outdated concept of access; grid electricity is just one piece of the puzzle, and to truly power Africa it's necessary to invest in energy for community services, such as health and education, alongside energising homes and businesses. | This service-focused approach has been championed by the UN sustainable energy for all initiative through the global tracking framework, which sets out a new way of defining and delivering energy access. Power Africa runs the risk of being an innovative mechanism using an outdated concept of access; grid electricity is just one piece of the puzzle, and to truly power Africa it's necessary to invest in energy for community services, such as health and education, alongside energising homes and businesses. |
| Who benefits, who delivers? | Who benefits, who delivers? |
| $5bn of the $7bn Power Africa fund will "support US exports for the development of power projects". With the initiative announced during a US-African trade mission, Obama made no secret that "my own nation will benefit enormously if you reach full potential". General Electric, frequently mentioned by Obama during the launch, will no doubt be among the beneficiaries. | $5bn of the $7bn Power Africa fund will "support US exports for the development of power projects". With the initiative announced during a US-African trade mission, Obama made no secret that "my own nation will benefit enormously if you reach full potential". General Electric, frequently mentioned by Obama during the launch, will no doubt be among the beneficiaries. |
| There are two issues at stake here. First, can such a high proportion of tied aid be healthy, or represent value for money? Second, can overreliance on the private sector be justified when public and civil society organisations have a better track record of delivering for the poorest people? | There are two issues at stake here. First, can such a high proportion of tied aid be healthy, or represent value for money? Second, can overreliance on the private sector be justified when public and civil society organisations have a better track record of delivering for the poorest people? |
| Belief among governments and donors in the power of markets to mobilise capital fails to recognise the role of the public sector and civil society in delivering services in the developed world. Obama's administration would do well to reflect on their own national development. At the beginning of the 1930s, only one in 10 rural farms in the US had access to electricity; 20 years later, almost all had access and rural electrification was complete. How? Through a Roosevelt New Deal programme, providing subsidised finance to farmers' co-operatives to build, operate and maintain power lines in areas where private companies would not venture. | Belief among governments and donors in the power of markets to mobilise capital fails to recognise the role of the public sector and civil society in delivering services in the developed world. Obama's administration would do well to reflect on their own national development. At the beginning of the 1930s, only one in 10 rural farms in the US had access to electricity; 20 years later, almost all had access and rural electrification was complete. How? Through a Roosevelt New Deal programme, providing subsidised finance to farmers' co-operatives to build, operate and maintain power lines in areas where private companies would not venture. |
| Today, civil society remains a major power producer in rural areas of the US, with co-operatives providing power to an estimated 42 million people in 47 states (accounting for about 11% of the total kilowatt hours sold in the country). | Today, civil society remains a major power producer in rural areas of the US, with co-operatives providing power to an estimated 42 million people in 47 states (accounting for about 11% of the total kilowatt hours sold in the country). |
| In low-density populations across Africa, just as in the US, the private sector will struggle to make a profit (US co-ops serve an average of seven consumers per mile of line, compared with an average of 34 consumers for investor-owned utilities). Alongside investing in the private sector, will Power Africa support others who have expertise in delivering to remote, rural communities? | In low-density populations across Africa, just as in the US, the private sector will struggle to make a profit (US co-ops serve an average of seven consumers per mile of line, compared with an average of 34 consumers for investor-owned utilities). Alongside investing in the private sector, will Power Africa support others who have expertise in delivering to remote, rural communities? |
| For those who, like Practical Action, have been long-term advocates for energy-enabling development, it is exciting to see funds on the table. Power Africa clearly positions the US administration as a serious player in the drive to deliver energy access. But it is not alone; it sits alongside equally heavy-hitting commitments from, among others, the European commission, which has pledged to deliver modern energy services to 500 million people in developing countries by 2030. The ability to power Africa will, in no small part, depend on a coherent and complementary approach – the international energy community needs to aspire to connect donor dots as well as African homes, community services and businesses. | For those who, like Practical Action, have been long-term advocates for energy-enabling development, it is exciting to see funds on the table. Power Africa clearly positions the US administration as a serious player in the drive to deliver energy access. But it is not alone; it sits alongside equally heavy-hitting commitments from, among others, the European commission, which has pledged to deliver modern energy services to 500 million people in developing countries by 2030. The ability to power Africa will, in no small part, depend on a coherent and complementary approach – the international energy community needs to aspire to connect donor dots as well as African homes, community services and businesses. |
| • Helen Morton is head of global advocacy at Practical Action | • Helen Morton is head of global advocacy at Practical Action |
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