How might Covid-19 reshape the energy sector in Africa?

24 March 2021

Africa has not been spared the COVID-19 pandemic. The question is whether the pandemic will cause a setback in the transition to a more secure and sustainable energy system or whether it will catalyse change. In any case, global carbon emissions are expected to rebound more slowly than after the financial crisis of 2008 and 2009. If the pandemic continues beyond 2021, it will mark the beginning of the slowest decade of energy demand growth in a century.

The economic gains of recent years are at risk everywhere. Improving infrastructure is rightly among the proposed countermeasures and should be a major component of any recovery plan, both to respond to the pandemic and to build long-term resilience. Energy potential in Africa can turn the COVID-19 crisis into an opportunity for the continent and its population.

The AfDB will support the establishment of the Off-Grid Infrastructure Reconstruction Platform (OGRP), with a blended funding of US$50 million, following the adverse effects of the Covid-19 pandemic.

This initiative aims to provide assistance and recovery capital to energy access companies, supporting them during and after the pandemic.

The $20 million concessional package will be complemented by their own capital and instruments, which will provide $30-40 million in additional commercial financing and more affordable debt products, according to the document. In addition, through its partners, the recovery platform will support energy access companies that market and deploy solar home systems, green mini-grids, clean cooking systems and other decentralised renewable energy solutions.

The platform will provide immediate relief and recovery support and lay the foundation for a green and inclusive post-pandemic economic recovery.

It is imperative that the COVID-19 pandemic does not dampen efforts to increase energy access and clean cooking solutions which remain a major challenge in Africa. Today, around 548 million people still live without access to electricity and 894 million people lack clean cooking solutions.

The immediate priority for the African continent is to save lives, bring the health emergency under control and alleviate associated economic hardship. However, the recovery measures adopted should also address long-term development and create resilient economies. Utilising the locally available renewable energy resources that Africa is richly endowed with can alleviate immediate energy challenges, while creating jobs, advancing industrial development and promoting human welfare. It is estimated that renewable energy deployment could create an additional 2 million green jobs in Africa and Infrastructure Consortium for Africa (ICA) contribute it.

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