JOHANNESBURG - Africa needs cumulative investments of $2.6 trillion between 2019 and 2040 to meet rising energy demand and provide more accessible facilities to citizens as the continent's population expands, a report released on Monday shows.
In its Africa Energy Outlook 2019 report, the International Energy Agency (IEA) said Africa was experiencing the fastest progression of urbanisation the world over, and that its overall population was projected to expand by 600 million before 2040, accounting for half of the global increase.
These shifts, it said, would drive the continent’s economic growth, infrastructure development and, consequently, energy demand, which was predicted to rise by 60 percent.
"While this energy gap remains a major barrier to Africa’s sustained economic development, it inversely presents opportunities for many African nations such as current advancements in the liquefied natural gas (LNG) market, potential for realising onshore value, while simultaneously driving innovation in the raising of extensive financing for African projects, to name a few," the report stated.
With appropriately funded, developed and executed policies, Africa not only had the potential to close the energy gap by providing millions of its people with access to electricity by 2030, but could become the first continent to boost its economy largely through the use of modern, low-carbon energy sources.
Africa’s abundant supply of natural gas enabled the continent to increase industrial operations along with flexible electricity supply that complemented renewables.
"Africa has an opportunity to pursue a considerably lower carbon strategy in comparison to its global counterparts, subsequently leapfrogging the fossil fuel sector and affording its people with clean, reliable and accessible energy, further reducing the energy gap and ultimately raising the standard of living of its residents," the report stated.
Having substantial reserves of minerals, such as platinum and cobalt, required in rapidly expanding and critical clean energy technologies, the continent represented a pivotal player in the current and future global energy realm, it added.
Although current government budgets and development funding may be inadequate to finance investments required to address the region's rising power demands, mobilising private capital was a realistic alternative.
Next year's Africa Energy Indaba, the continent’s definitive energy forum, providing an agenda to influence energy policy, would provide a multitude of business opportunities for those invested and seeking to invest in the energy sector, the report added.