Power Africa sheds light on new opportunities

barack obama

US President Barack Obama

01 March 2014, Washington — Power Africa, an initiative to improve reliable access to electricity for millions of Africans, has been investing in a range of energy projects that partners hope will boost economic growth in African nations.

“Reliable electricity allows businesses to operate productively and generate jobs. Access to electricity also is essential to support vital community services such as hospitals, health clinics and schools. Electricity powers street lights to improve safety and increase business activities at trading centers,” Daniel Yohannes, chief executive officer for the Millennium Challenge Corporation (MCC), said on the MCC website.

“By powering Africa, we are doing more than providing light. We are providing hope and promising futures,” Yohannes said.

Power Africa, announced by President Obama in June 2013, initially involves six African countries — Ethiopia, Ghana, Kenya, Liberia, Nigeria and Tanzania — with the goal of adding more than 10,000 megawatts of clean, efficient electricity generation capacity.

The multiyear effort draws on the expertise of 12 U.S. government entities, including the departments of State, Agriculture, Commerce, Treasury and Energy, the Millennium Challenge Corporation, the U.S. Agency for International Development and the Overseas Private Investment Corporation. Power Africa also works with major funders like the African Development Bank and the World Bank. In all, the United States has committed more than $7 billion in financial support and loan guarantees to Power Africa through 2018.

Officials say that Power Africa will bridge the gap between Africa’s power shortage and its economic potential by working with partners to help countries responsibly unlock the region’s substantial wind, solar, hydropower, natural gas and geothermal resources, build power generation and transmission facilities and expand the reach of minigrid and off-grid solutions.

Some of Power Africa’s notable investments so far include the Aeolus Kenya wind project, one of the largest wind power generation projects to be built in sub-Saharan Africa. Kenya’s government, project funders and Aeolus Kenya Ltd. are finalizing agreements to fund the building of the Kinangop Wind Park. Power Africa’s role is to support the implementation of a grid management program. The 60-megawatt wind farm will generate enough renewable electricity to power the equivalent of 150,000 homes in the country, according to General Electric, the company that will supply the project’s wind turbines.

Ethiopia’s government, the Ethiopian Electric Power Corporation and Reykjavik Geothermal have agreed to establish the Corbetti Geothermal Power Plant, a 1,000-megawatt venture that is the first independent power project in Ethiopia’s history. Power Africa will provide technical advice to move the project forward.

In Tanzania’s agricultural corridor, Power Africa approved a loan guarantee for the Kiwira River Hydro Project. This guarantee will facilitate local finance for the 10-megawatt minigrid project.

Power Africa partners recognize that business and government need to make long-term commitments to solve Africa’s energy deficiency. Those include building institutional capacity to attract investment, conducting feasibility studies, promoting transparency and removing regulatory roadblocks. And they include two-way trade missions and loan guarantees. Those measures combined can help attract additional investment to help Africa’s economies to grow, officials say.

About the Author