A Review of the Nigerian Energy Industry

Africa needs $450bn to plug power deficit

Power generation plant.
Power generation plant.

04 September 2015, Kampala, Uganda – Africa is likely to be a key attraction when players in the power generation, transmission and distribution convene for the 12th edition of the Elecrama World Electricity Forum, in Bangalore, India in February.

Producing only a third of the power needed in the continent for the next 15 years, industry analysts forecast a $450 billion opportunity for electrical equipment and services value chain to meet the shortfall.

Speaking in Kampala this week, at the end of a roadshow that also took him through Nairobi and Dar es Salaam, Mr Uttam Kumar, the chief executive of Elecrama 2016, a trade and networking forum for the energy sector, said Africa needs to add 250 gigawatts by 2030 to light up the two-thirds of her population that currently lacks access to electricity.

“To meet this demand, an additional investment of $450 billion in the power sector is needed,” Mr Kumar said, adding that Africa can take advantage of the recent evolution of renewable energy technology and reduced cost to leapfrog the path taken by industrialised economies.

According to Mr Aaditya Dhoot, the chairman of Elecrama 2016, at 1,750 gigawatts, Africa’s onshore wind resources exceed the continent’s total demand for the foreseeable future and at the forum, sector planners can catch up on the technology, best practices, new systems and forecasting trends in the future of electricity.

Some African economies are incurring a penalty of between one and five per cent of their GDP through power blackouts and reliance on expensive diesel electricity generation. But with its vast wind resources and good planning, the share of renewable energy could increase by upto 50 per cent of supply by 2030 peaking at 73 per cent by 2050.

India’s $22 billion electrical equipment manufacturing industry is looking at these numbers with keen interest. According to Dr Ramesh Chandra, India’s High Commissioner to Uganda, with only 16 per cent of Ugandans connected to the grid but with a cascade of power projects lined up for development, the country will be a beneficiary of between $300-400 of Indian government credit for power sector development.

More than 120 countries are expected to participate in Elecrama 2016 with over 10,000 products and solutions spanning the entire value chain on display.
*Michael Wakabi – The East African

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