HomeIndustry SectorsGenerationElectricity for all at US$48 billion per annum

Electricity for all at US$48 billion per annum

of the Paris-based
International Energy
Paris, France — ESI-AFRICA.COM — 11 October 2011 – The world’s entire population can have electricity and cleaner stoves by 2030 if US$48 billion is invested in energy each year, the International Energy Agency (IEA) said in its first estimate of the cost of ending energy poverty.

This sum is about the same as the combined annual capital spend of Europe’s two biggest oil companies “’ Royal Dutch Shell plc “’ and five times the US$9.1 billion that was invested in 2009 to boost energy access in developing nations. There are 1.3 billion people, or 20% of the world population, living without electricity, and 2.7 billion that lack clean cooking facilities, the IEA said.

“The obstacles to providing modern energy access to everyone are surmountable and national governments should publish targets and provide more seed capital to incentivise private investors,” IEA Chief Economist Fatih Birol said in an interview here.

“Providing energy for all is crucial for social and economic development, and beyond that it’s a moral obligation,” he added. “An illustration of the inequality is that 791 million people in sub-Saharan Africa excluding South Africa use about as much energy each year as 19.5 million people in New York State,” Birol pointed out, citing IEA data.

Vietnam is an example of a success story, according to the IEA report titled “Energy for All, Financing Access for the Poor”. The share of the population with electricity has risen to 98% from less than 5% in the past 35 years, the agency said.

“The electricity supply has become far more reliable,” Tran Thi Thu Lan, 58, a retired high school teacher in Hanoi, said in an interview. “In the past we had rolling power cuts which made our lives more difficult.”

Bangladesh, Ghana and South Africa have plans to extend electricity to all their populations by 2020, according to the IEA. Indonesia plans to connect 95% of its people to power supplies by 2025, while the Philippines targets 90% of households by 2017, according to the IEA.

In Kenya, 84% of the 33 million population had no access to electricity in 2009, and 83% of Kenyans relied on traditional cooking facilities powered mainly by wood, agricultural and animal waste, the IEA said.

African nations that lack energy reserves face the greatest challenge in providing energy to their people. Oil import bills in sub-Saharan Africa increased by US$2.2 billion last year, outpacing gains in development assistance funding, according to the IEA.

Oil exporters on the continent such as Nigeria and Angola could better use their revenue to end energy poverty, says the report. “The capital cost of providing modern energy services to all deprived households in the 10 largest oil and gas exporting countries of sub-Saharan Africa is about US$30 billion, or about 0.7% of those governments’ cumulative income from oil and gas exports,” IEA data showed.