Lack of power shorts African growth

POWER shortages across Africa slashed regional growth by between 2% and 4% every year, according to research by Kofi Annan’s Africa Progress Panel.

The former UN secretarygeneral’s Africa Progress Report, released at the World Economic Forum on Africa this week, said energy infrastructure shortages left more than 600 million people in sub-Saharan Africa literally powerless, and severely curtailed economic growth.

For South Africans enduring indefinite power cuts thanks to Eskom’s poor planning and bumbling efforts to build the Medupi and Kusile power plants, the fact that other African countries are also squeezed will be cold comfort.

According to the report, the sub-Saharan region could produce just 90 gigawatts of power — and half of this is generated by South Africa.

Bank of Botswana governor Linah Mohohlo said countries were investing just 0.4% of GDP on energy. A figure of between 3% and 4% was needed if Africa wanted to meet its energy needs, she said.

Graça Machel said that at the current rate of electrification, it would take until 2080 for all Africans to have access to electricity.

“We can’t take the risk of leaving to other generations what we have the capacity to do today,” she said.

The report found that frequent power cuts led to a loss of about 6% of turnover for large firms and up to 16% for smaller businesses. The overall cost of Africa’s energy deficit totalled $38-billion in 2010.

Africa’s unreliable power supply had created a “buoyant market in diesel-powered generators”, the report said.

“Around 40% of businesses in Tanzania and Ethiopia operate their own generators, rising to over 50% in Kenya.”

But the cost was four times that of grid-supplied electricity. The report cited research showing that diesel fuel made up about 60% of operating costs for cellphone networks in the region.