‘Power utilities a source of energy crisis in Africa’

Governance of power utilities is at the heart of Africa’s energy crisis, an energy report says.

Fidelity Mhlanga

According to the Africa Progress Report 2015, Power People Planet Seizing Africa’s energy and climate opportunities done by Africa Progress Panel chaired by former United Nations secretary-general Kofi Annan, African governments view utilities primarily as sources of political patronage and vehicles for corruption while providing affordable energy is a distant secondary concern.

“Governance of power utilities is at the heart of Africa’s energy crisis. Governments often view utilities primarily as sites of political patronage and vehicles for corruption, providing affordable energy can be a distant secondary concern,” reads the report.

The report says the international community will channel an additional US$10 billion in aid and concessional finance to support investments that deliver energy access to populations that are being left behind.

African governments should mobilise around US$10 billion to expand on-grid and off-grid energy access with the international community, says the report.

It is estimated that the 138 million households comprising people living on less than US$2,50 a day are spending US$10 billion annually on energy-related products such as charcoal, candles, kerosene and firewood.

Zimbabwe is saddled by a power deficit, producing 1 203 megawatts (MW) against demand of 2 200MW due to obsolete machinery and limited investment in the energy sector.

Power people planet report affirms that African governments spend US$21 billion annually covering utility losses and subsidising oil-based products, diverting resources from more productive energy investments.

Zimbabwe Electricity Transmission and Distribution Company (Zetdc) MD Julian Chinembiri told parliament last month, that the company is owed over US$300 million by domestic customers, public lighting US$27 million, mining and industries US$244 million, while commercial and agriculture owe the utility US$351 million and US$75 million respectively.

Zimbabwe Electricity Supply Authority was under the spotlight after it emerged that the power utility flouted tender processes.

According to the report, some 130 independent power providers (IPPs), are now operating across Sub-Saharan Africa with a new generation of private equity investors also emerging.

In Zimbabwe only eight of 22 licensed IPPs are operational IPPs as government’s desire to see IPP projects coming up to complement power supplies from Zimbabwe Power Company.

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