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Estimating Investment Needs for the Power Sector in Africa 2023-2030

Octobre 2024
Banque Africaine de Développement (63 pages).

This study is a contribution to the ongoing discussion on the costs and implications of addressing the two fundamental energy challenges facing the African continent, namely achieving universal access to electricity in line with Sustainable Development Goal number 7 and expanding power systems to support economic growth without getting locked into a high-emissions pathway.
Specifically, the study aims to derive insights from economic least-cost expansion modelling to:
- Estimate economic least-cost investment requirements and related emissions; and
- Explore existing structural barriers to and enablers of the energy transition.
The headline estimates indicate a Base Case investment requirement of about USD 454 billion, or USD 64 billion per year from 2023 until 2030, if an optimal investment plan is realized. Behind this headline, there are several interesting results and findings. The timeline for SDG 7 is slipping. Significant progress has been made in electrification across the Continent over the past decade, with the share of connected households increasing from 25.7 percent in the year 2000 to 50.6 percent in 20202. Even so, it is estimated that nearly 195 million new connections will be required from 2023 till 2030 to achieve universal access and keep pace with population growth. The Base Case of this study includes an unprecedented expansion of off- and mini-grid connections through a significant mobilization of private investments and expansion of supply chains, supported by robust and harmonized regulatory frameworks and incentives.