WASHINGTON – Anybody who knows sub-Saharan Africa will tell you that the main obstacle to additional economic growth is lack of electricity. More than 600 million Africans are not connected to the grid. And the impact of this is devastating. Just look at any satellite picture of Africa at night. What you see is a huge dark continent. No lights means no electricity; and this means no economic activities, at night and during the day.
A relatively small number of mostly urban African citizens (around 25 or 30%) have electricity. But supply is unreliable. Most factories, workshops, hotels, hospitals and other businesses must have back up generators that kick in during the frequent power failures. Reliance on generators, while essential, is horribly expensive. Imagine any US small factory having to run diesel generators almost every day in order to keep its machines running and meet its production targets because the local utility would send power to customers only a few hours a day.
Because of all this, when President Obama launched his $ 14 billion “Power Africa” initiative during a trip to South Africa, (Capetown, June 30, 2013), everybody paid attention. At the time it seemed that the US administration had finally decided to concentrate limited foreign assistance funds for Africa on one big ticket issue that, when properly addressed, would have enormous “force multiplier” effects.
It was also of great interest that the US government would work in close partnership with major US corporations. So, this was not just foreign aid. This was presented as an American public and private effort aimed at boosting Africa’s economic growth potential.
Electricity is of course essential. The difference between having it and not having it is huge. Access to reliable and affordable energy would allow immense economic progress for hundreds of millions in Africa, while improving everything: manufacturing, business, education, health care, financial services, you name it.
A bad plan
Upon review, however, Power Africa had enormous structural weakness. Its big budget would result from the consolidation of the grants, loans and investment activities of a variety of US federal agencies, while setting up –from scratch– cooperation mechanisms with major private sector companies (including General Electric and Symbion Power) that were expected to fork about $ 7 billion in new power generation investments.
And this is only half the story. The multiple US partners in this huge and untested arrangement would have had to interface with a variety of African stakeholders, (central and local governments, public utilities, private companies, chambers of commerce, financial institutions, and various NGOs), in several countries.
At some point, all this would have resulted in the creation and approval of an agenda, with feasibility studies, budgets, financial arrangements, and finally allocation of resources and construction of new power plants and distribution lines.
The complexity of all this is mind-boggling. The notion that US federal bureaucracies would be able to pull this off within a reasonable time frame was a dream.
And a dream it was. So far, two years later, not much has been done. Sure enough, there have been interventions here and there. Technical assistance has been provided for this or that project.
However, almost nothing when it comes to large “greenfield” projects. Critics argue that many of the projects that Power Africa would like to list as its own in fact were already in the making when this new initiative came about, therefore Power Africa cannot take any credit for them.
Are we talking about failure? May be not total failure. But, if there are any achievements, they are not even remotely on the scale of what was announced by President Obama back in June 2013.
Additional proof of this is that Power Africa is seldom mentioned. A recent story in The Economist (The leapfrog continent, June 6th, 2015), is entirely devoted to Africa’s electricity needs. The article describes in some detail Africa’s power generation projects, while analyzing large plans being worked on, from South Africa to Ethiopia, with a special focus on the role of renewable energy.
Well, guess what, The Obama administration Power Africa initiative and its projected $ 14 billion dollars of new investments in electrical power generation is not even mentioned in this long piece entirely devoted to Africa’s energy needs. Not even mentioned. Talk about irrelevance.
And this was supposed to be the new grand plan for Africa coming from America. Some plan.