According to African Energy Indaba (AEI) chairperson Brian Statham, the best way to boost socioeconomic development of the energy sector requires greater thinking within the sector itself.
The African Energy Indaba, held this year on the 20th and 21st of February in Johannesburg, explored the resilience of the sector, as well as how its different components can interact to create and add value for a sustainable future. The African Energy Indaba is the continent’s premier energy conference and exhibition: bringing together leading African and global energy players to unlock energy and business opportunities across the African continent. The aim of the Indaba was to find sustainable and pragmatic solutions to the various issues facing the African energy sector, such as the continents lack of formal energy in many parts, widespread poverty and harsh climactic conditions, as well as inadequate infrastructure.
Furthermore, the African Energy Indaba addressed the difference in performance of national energy sectors across Africa. “The diversity in energy sources provides an opportunity, provided that there is a focused exchange of knowledge, experience and technology. The continent needs an interconnection of energy systems in order for this diversity to be fully used.”
According to David Mahlobo, minister of energy, “Infrastructure development is pertinent to the development agenda of African countries. Apart from providing critical social and welfare services, infrastructure is an important enabler of economic growth by creating a supportive platform for the growth of business, facilitating job creation, enhancing trade opportunities, attracting investment and ultimately reducing poverty. Energy is an enabler for all this,” For this to work, Africa’s investment climate needs to strengthen to minimize perceived risks. Mahlobo says that, “Energy projects face comparatively tougher upfront funding gaps than do many other infrastructure projects because of investors lack of confidence in long-term expectations on secure revenue streams. High investment risk may also result in undervalued assets, leaving reduced financial incentives for the investor.” Policy harmonization regionally and within Africa is key to minimizing this perceived risk.
Mahlobo argues that private-public partnerships are essential to development. He states that, “Without the private public partnerships, it is not possible for out utilities and governments to fund the energy infrastructure requirements”. Africa thus requires partnerships with international orgnaisations, other governments and private businesses.
Investments in Africa’s energy sector are expected to filter in soon. Mahlobo states that, “The African continents population will have grown by 800 million by 2040. The middle-class is forecasted to increase, and this will trigger economic growth, urbanization, industrialization and modernization. This phenomenon can be realized if we have adequate energy to fuel the African economies.”