African Development Bank will manage Africas New Deal on Energy along with investing US$12bn in energy funding over the next five years
Africa has been well-recognised as a huge resource potential for the energy sector and yet the economic conditions do not yet allow the complete utilisation of this potential. It is these circumstances that have given rise to 'New Deal on Energy', unveiled during the World Economic Forum in Davos this week.
The deal focuses on four main aims - to increase on-grid generation by adding 160GW of new capacity by 2025; to increase on-grid transmission and grid connections that will create 130mn new connections by 2025 (more than double the current amount); to increase off-grid generation to add 75mn connections in the ten years and to increase access to clean cooking energy for around 130mn households.
All this would require an investment of US$60-90bn a year compared to the US$22bn devoted to the energy sector last year. This difference is intended to come from multiple sources; money raised from within the continent and beyond, government and financial institutions.
The new deal will also focus on setting up a favourable energy policy environment for the along with keeping the energy resource and technology neutral. There are plans to dedicate efforts to ensuring changes in regulation to make the sector more attractive for private capital.
