Though the Electrify Africa Act to bring electricity to 50 million Africans for the first time might be federal legislation, that doesn’t mean that the US government is working alone. High investment costs and the magnitude of the energy deficit require that the US government work with other partners, including private companies, to achieve the bill’s ambitious but attainable goals.
In fact, private companies are already working closely with both the US government and national governments across the African continent to provide millions of Africans with reliable and affordable access to electricity.
So why are the public and private sectors working so closely together? To start, it makes total economic sense. Roughly $30 billion needs to be invested annually in order to provide basic universal access to electricity in Africa by 2030. Public funds can’t single-handedly provide all of the financing required, so leveraging private sector resources will be a big help in closing the gap.
However, the relationship goes both ways – while national governments often rely on the private sector to invest resources upfront into energy projects, companies are often equally as dependent on the government to ensure there is sufficient legislative support to be able to effectively implement and manage long-term projects in the electricity sector.
At a recent event hosted by the National Rural Electric Cooperative Association (NRECA), Ambassador of Tanzania Liberata Mulamula expressed her country’s excitement over private sector engagement and called for a strategic framework to guide state partnerships with private companies, both foreign and domestic. She noted that where there are risks, there are opportunities and that she and her colleagues are determined to put Africa on the map for trade and investment.
At the same event, Dan Waddle, Senior Vice President of NRECA International, emphasized the importance of private sector involvement in Africa’s energy sector for reasons beyond internal business interests. He explained that smaller businesses and cooperatives will also be key partners in bringing access to electricity and that they will “become engines of economic growth for the communities they serve.”
There is a real opportunity here for the energy sector to generate growth and prosperity across the continent, not only for the beneficiaries of the companies themselves, but most importantly, for local citizens too. Energy is one area where the private sector can contribute towards development more than ever before – in part because energy is so central to many aspects of development. Harnessing public-private partnerships will make a real difference in people’s lives from improved access to decent healthcare and education to the provision of basic human needs.
Ambassador Mulamula ended the panel on an especially poignant note given the wintery weather this time of year: “When there’s a snowstorm in the US and the electricity goes out, it’s declared a state of emergency. In Tanzania, it’s the same as every other day”.