Finding: Money, Not Technology, Keeps Africa in the Dark

About 600 million Africans live without electricity. Sub-Saharan Africa is home to around eight in ten of all people in the world who have no power. This is often described as a technology problem. Our finding is that it is above all a money problem.

What we found

Solar panels, mini-grids, hydro, geothermal and gas plants already work across Africa. What is missing is affordable finance. Borrowing costs for African projects are often three to four times higher than in advanced economies, and sub-Saharan Africa receives only about 2% of global clean energy investment. High interest rates make power expensive, and expensive power keeps projects on paper.

Proof from Africa

• Ethiopia financed much of the Grand Ethiopian Renaissance Dam with its own resources, including bonds bought by ordinary citizens. It is now Africa’s largest hydropower plant.
• Kenya built a geothermal sector in the Rift Valley that supplies a large share of the country’s electricity.
• Morocco built Noor Ouarzazate, one of the world’s largest concentrated solar complexes.

What can be done

1. Let African pension funds and savings invest in African power, with clear protection.
2. Use public guarantees to lower the risk, and therefore the price, of private finance.
3. Start with mini-grids where the national grid will not arrive for years.

Take this with you

• Africa does not lack energy. It lacks affordable money to use it.
• Every new connection is a clinic, a classroom and a small business.