Africa Energy Outlook 2019

Africa Energy
Outlook 2019
World Energy Outlook Special Report

Africa Energy
Outlook 2019
www.iea.org/africa2019
Africa Energy Outlook - Cover Layout.indd 4 31-10-2019 17:09:18

INTERNATIONAL ENERGY
AGENCY
The IEA examines IEA member IEA
the full spectrum
countries: association
of energy issues
including oil, gas countries:
and coal supply and Australia
demand, renewable Austria Brazil
energy technologies,
Belgium China
electricity markets,
energy efficiency, Canada India
access to energy, Czech Republic Indonesia
demand side Denmark Morocco
management and
Estonia Singapore
much more. Through
its work, the IEA Finland South Africa
advocates policies France Thailand
that will enhance Germany
the reliability,
Greece
affordability and
sustainability of Hungary
energy in its 30 Ireland
member countries, Italy
8 association
Japan
countries and
beyond. Korea
Luxembourg
Mexico
Netherlands
New Zealand
Norway
Poland
Portugal
Slovak Republic
Spain
Sweden
Switzerland
Turkey
United Kingdom
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Foreword
As Africa’s population rapidly expands and urbanises, its need for reliable and sustainable
energy supply will become greater than ever. This energy is needed not only to drive the
continent’s economic development but also to provide modern energy services to the large
numbers of Africans currently living without them. Africa is set to emerge as a key driver of
global energy demand growth, one that is home to abundant reserves of fossil fuels, solar
power and minerals that will be vital for clean energy transitions worldwide. And even
though Africa has produced just 2% of global energy-related carbon dioxide (CO₂)
emissions, the continent is disproportionately on the front line when it comes to the effects
of the world’s changing climate.
The International Energy Agency (IEA) has long paid close attention to Africa’s energy
sector. We have been working on energy access issues on the continent for nearly two
decades, notably through our pioneering analysis in the World Energy Outlook series. This
new special report is significant in its unrivalled breadth and depth, with a particularly
granular focus on sub-Saharan countries.
Africa’s growing urban populations will require ever more energy to power industrial
production, air conditioning and expanding use of transport. In our Stated Policies Scenario,
based on current and announced policies, African energy demand grows twice as fast as
the global average over the next two decades. That includes an additional 500 million
people who are expected to live in areas requiring some form of cooling. Despite a shift to
modern and more efficient energy sources over this period, the continent’s current policy
settings aren’t enough to put it on track to meet its development needs and provide
reliable and modern energy services for all.
Effective energy policy choices are essential to deliver Africa’s inclusive growth ambitions
(such as those contained in the region’s Agenda 2063 strategic framework), and to help
meet other major sustainable energy and development goals. This is why we introduce the
Africa Case in this report, a new scenario built around Africa’s own vision for its future. It
incorporates the policies needed to develop the continent’s energy sector in a way that
allows economies to grow strongly, sustainably and inclusively. Doing so does not mean
African economies have to become ever more energy intensive. Africa stands on the cusp
of a unique opportunity: the possibility of becoming the first continent to develop its
economy primarily by using energy efficiency, renewables and natural gas – all of which
offer huge untapped potential and economic benefits.
For example, Africa has the richest solar resources on the planet, but has installed only
5 gigawatts of solar photovoltaics (PV), accounting for less than 1% of global capacity. With
the right policies, solar could become one of the continent’s top energy sources. Natural
gas, meanwhile, is likely to correspond well with Africa’s industrial growth drive and need
IEA. All rights reserved.
for reliable electricity supply. Today, the share of gas in sub-Saharan Africa’s energy mix is
among the lowest in the world. But that could be about to change, especially considering
the supplies the continent has at its disposal: it is home to more than 40% of global gas
Foreword 3
discoveries so far this decade. Africa’s rich natural resources aren’t limited to sunshine
and other energy sources. Its major reserves of minerals such as cobalt and platinum
that are crucial for clean energy technologies mean the continent holds the key
ingredients for global energy transitions.
This Africa Energy Outlook contains quantitative analysis of important factors influencing
energy development in Africa. This includes detailed modelling of 11 sub-Saharan countries
that enabled us to produce comprehensive, data-rich profiles from which we extracted
important implications for Africa and the world. The profiles are a notable highlight of the
report, providing a much greater level of detail than any other analysis of energy in Africa.
This report comes at an important time in the IEA’s deepening engagement with Africa. It
reflects the continent’s increasing role in global energy affairs and the strengthening
relationships between African energy decision makers and the IEA. South Africa and
Morocco are now part of the IEA family. In May 2018, the IEA and the African Union
Commission co-hosted their first joint ministerial summit at which African Union
Commissioner Dr Amani Abou-Zeid and I signed a strategic Memorandum of Understanding
to guide the two organisations’ future collaborations. A second ministerial forum will be
held in 2020.
I hope this new report serves as both an anchor for our new programme of work with
African countries and also as a means to guide the continent towards a more secure and
sustainable energy future.
Dr. Fatih Birol

Executive Director
4 Africa Energy Outlook 2019 | Special Report

Acknowledgements
This study was prepared by the World Energy Outlook (WEO) team in the Directorate of
Sustainability, Technology and Outlooks (STO) in co-operation with other directorates and
offices of the International Energy Agency. The study was designed and directed by
Laura Cozzi, Chief Energy Modeller. Stéphanie Bouckaert, Tae-Yoon Kim, and
Kieran McNamara were the principal authors. Tim Gould, Head of Division for Energy
Supply and Investment Outlooks, provided essential guidance.
The other main authors were: Lucila Arboleya Sarazola (investment), Yasmine Arsalane
(power), Arthur Contejean (energy access), Timothy Goodson (electricity demand and
buildings) and Molly A. Walton (resource management).
Other key contributors were: Thibaut Abergel (cities), Zakia Adam (country profiles, data
management), Ali Al-Saffar (urbanisation and industrialisation), Bipasha Baruah (gender),
Michela Cappannelli (biogas), Haoua Cisse Coulibaly (policies), Davide D’Ambrosio
(country profiles, data management and visualisations), Amrita Dasgupta (transport),
Chiara Delmastro (cooling), Marina Dos Santos (policies), John Dulac (cooling), Jinsun Lim
(climate impact on hydro), Luis Munuera (visualisation), Paweł Olejarnik (supply
modelling), Apostolos Petropoulos (transport), Andrew Prag (climate impact on hydro),
Arnaud Rouget (energy access), Marcela Ruiz De Chavez Velez (industry),
Andreas Schröder (industry) and Wilfred Yu (power). The study also relied on support from
across the entire WEO team. Teresa Coon and Eleni Tsoukala provided essential support.
Edmund Hosker carried editorial responsibility. Debra Justus was the copy-editor.
The IEA is especially grateful to H.E. Dr. Kandeh Yumkella for valuable input and guidance
throughout the project.
Mechthild Wörsdörfer, Director of STO, provided guidance throughout the project.

Valuable comments and feedback were provided by other senior management and
numerous other colleagues within the IEA. In particular, Paul Simons, Nick Johnstone,
Laszlo Varro, Peter Fraser, Brian Motherway, Rebecca Gaghen, Alessandro Blasi and Joel
Couse.
Thanks go to the IEA’s Communication and Digitalisation Office for their help in producing
the report and website materials, particularly to Jad Mouawad, Jethro Mullen, Astrid
Dumond, Jon Custer, Christopher Gully, Isabelle Nonain Semelin and Sabrina Tan. Diana
Browne and Ivo Letra provided essential support to the production process. IEA’s Office of
the Legal Counsel, Office of Management and Administration and Energy Data Centre
provided assistance throughout the preparation of the report. Uğur Öcal and Ryszard
Pośpiech also provided support.
Valuable input to the analysis was provided by David Wilkinson (independent consultant),
Emmanouil Christinakis (independent consultant), Dr. Andriannah Mbandi (Stockholm

Environment Institute), Jacqueline Senyagwa (University of Cape Town), Andreas Sahlberg,
Babak Khavari, Alexandros Korkovelos and Mark Howells (KTH Swedish Royal Institute of
Acknowledgements 5
Technology), Jose Ignacio Perez-Arriaga, Fernando de Cuadra-García, Andrés González-
García and Pedro Ciller-Cutillas (MIT-Comillas Universal Energy Access Lab), Markus Amann,
Peter Rafaj, Gregor Kiesewetter, Wolfgang Schöpp, Chris Heyes, Zbigniew Klimont, Jens
Borken-Kleefeld and Pallav Purohit (International Institute for Applied Systems Analysis).
The work could not have been achieved without the support and co-operation provided by
many government bodies, organisations and companies worldwide, notably: Eni; European
Commission; Ministry of Economic Affairs and Climate Policy, Netherlands; Ministry of
Economy, Trade and Industry, Japan; and Schneider Electric. Activities within the IEA Clean
Energy Technologies Programme provided valuable support to this report.
A high-level workshop on the Africa Energy Outlook, was held in Paris on 17 April 2019. The
participants offered valuable new insights, feedback and data for this analysis.
Further details on these events are available at www.iea.org/weo/events.
Many senior government officials and international experts provided input and reviewed
preliminary drafts of the report. Their comments and suggestions were of great value. They
include:
Thomas A. Frankiewicz US Environmental Protection Agency (EPA)
Amani Abou-Zeid African Union Commission, Ethiopia
Olalekan David Adeniyi Chemical Engineering Department, Federal University of
Technology, Nigeria
Wisdom Ahiataku-Togobo Ministry of Energy, Ghana
Safiatou Alzouma Nouhou Africa Renewable Energy Initiative (AREI)
Pedro Antmann World Bank
Edi Assoumou Mines ParisTech, France
Douglas K Baguma Innovex, Uganda
David Bénazéraf Sahel and West Africa Club (SWAC), OECD
Chakib Benmoussa Kingdom of Morocco
Christian Besson Independent consultant
André Kabwe Bibombe Energy Commission, DR Congo
Rina Bohla Zeller Vestas, Denmark
Edward Borgstein Rocky Mountain Institute, Sustainable Energy for Economic
Development (SEED) program (AFRICA)
William Brent Power for All
Irene Calvé Saborit Sunkofa Energy
Ute Collier Practical Action
Emanuela Colombo Politecnico di Milano, Italy
Anne-Sophie Corbeau BP
Jon Lezamiz Cortazar Siemens Gamesa
Christian de Gromard Agence Française de Développement (AFD), France

Joseph Essandoh-Yeddu Energy Commission, Ghana
Capella Festa Schlumberger

Silvia Francioso GOGLA
Mike Fulwood Nexant
Peter George Clean Cooking Alliance
Olivia Gippner DG Climate Action, European Commission
Kazushige Gobe Japan Bank For International Cooperation (JBIC)
Monica Gullberg Swedish International Development Cooperation Agency
(SIDA)
Andrew Herscowitz Power Africa, US Agency for International Development
Martin Hiller Renewable Energy and Energy Efficiency Partnership
(REEEP)
Kamiishi Hiroto Japan International Cooperation Agency (JICA)
Nastassja Hoffet Ministère de l’Europe et des Affaires Etrangères, France
Dona Jean-Claude Houssou Ministry of Energy, Benin
Samuel Igbatayo Afe Babalola University, Nigeria
Emmanuel K. Ackom UN Environment Programme (UNEP), Technical University
of Denmark Partnership (DTU)
Talla Kebe United Nations, Office of The Special Advisor On Africa
Daniel Ketoto Government of Kenya/Office of the President
Christoph Kost Institute for Transportation & Development Policy (ITDP)
Ken Koyama Institute of Energy Economics, Japan
Francesco La Camera International Renewable Energy Agency
Glada Lahn Chatham House
Per Landberg Norwegian Agency for Development Cooperation (NORAD)
Richard Lavergne Ministry for Economy and Finance, France
David Lecoque Alliance for Rural Electrification
Nikolaj Lomholt Svensson Embassy of Denmark in Ethiopia
Emadeldin Ahmed Mahgoub Agricultural Research Corporation (ARC), Sudan
Molka Majdoub African Development Bank
Mouhamadou Makhtar Ministère du pétrole et des énergies, Senegal
Senatla Mamahloko Council for Scientific and Industrial Research (CSIR), South
Africa
Martin Haigh Shell
Anne Marx Lorenzen Danish Ministry of Climate, Energy and Utilities
Atef Marzouk African Union Commission
Dimitris Mentis World Resources Institute (WRI), United States
Michelle Michot Foss University of Texas
Asami Miketa International Renewable Energy Agency
Arthur Minsat Organisation for Economic Co-operation and Development
Simone Mori ENEL
Isabel Murray Department of Natural Resources, Canada

Rose Mutiso Energy for Growth Hub
Glory Oguegbu Renewable Energy Technology Training Institute (RETTI)
Acknowledgements 7
Karin Ohlenforst Global Wind Energy Council (GWEC)
Sheila Oparaocha ENERGIA/HIVOS
Moussa Ousman Ministry of mines, Energy, and Hydraulics, Central African
Republic
Isaiah Owiunji World Wide Fund for Nature (WWF), Uganda
Cathy Oxby Africa Green
Pak Yongduk Korea Energy Economics Institute (KEEI)
Jose Ignacio Perez Arriaga Comillas Pontifical University’s Institute for Research in
Technology, Spain
Lapo Pistelli ENI
Jem Porcaro Sustainable Energy for All
Elisa Portale World Bank
Seth Roberts Saudi Arabian Oil Company
Amir Sadeghi International Monetary Fund (IMF)
Papa Samba Ba Ministère du Pétrole et des Énergies, Senegal
Thomas Scurfield National Resource Governance Institute, Tanzania
Carsten Staur Danish Ambassador to the OECD
Jessica Stephens Africa Minigrid Developers Association
Robert Stoner MIT Energy Initiative, United States
Dinesh Surroop University of Mauritius
Minoru Takada UN Department of Economic and Social Affairs
Rianne Teule SNV Netherlands Development Organisation
Wim Thomas Shell
Nikos Tsafos Center for Strategic and International Studies (CSIS)
Bob van der Zwaan Energy Research Centre of the Netherlands
(ECN part of TNO)
David Victor UC San Diego School of Global Policy and Strategy, United
States
Roberto Vigotti RES4MED&Africa
Abdulmutalib Yussuff Project Drawdown
Faruk Yusuf Yabo Federal Ministry of Power, Works & Housing, Nigeria
The individuals and organisations that contributed to this study are not responsible for any
opinions or judgments it contains. All errors and omissions are solely the responsibility of
the IEA.
This document and any map included herein are without prejudice to the status of or
sovereignty over any territory, to the delimitation of international frontiers and boundaries
and to the name of any territory, city or area.

Table of Contents
Foreword 3
Acknowledgements 5
Executive summary 13
Introduction 19
1 Africa today 27
1.1 Context 29
1.1.1 Economic growth and industrialisation 29
1.1.2 Demographics and urbanisation 31
1.1.3 Infrastructure and investment 32
1.2 Access to modern energy 35
1.2.1 Clean cooking 37
1.2.2 Electricity 41
1.2.3 Affordability: energy prices and fossil fuel subsidies 47
1.3 Energy trends in Africa today 49
1.3.1 Energy demand 49
1.3.2 Power sector 55
1.3.3 Fossil fuel resources and supply 66
1.3.4 Renewable resources and supply 72
1.3.5 Environment 75
2 Urbanisation, industrialisation and clean cooking 79

2.1 Introduction 81
2.2 Urbanisation and industrialisation, drivers of growth 83
2.2.1 Residential sector 88
2.2.2 Transport sector 92
2.2.3 Productive uses 96
2.3 Clean cooking: the role of cities and higher incomes 102
2.3.1 Increasing access to clean cooking options 104
2.3.2 Rapid urbanisation requires better use of charcoal 107
2.3.3 Rural areas – how to unleash the potential of biogas? 110
3 Access to electricity and reliable power 113

3.1 Introduction 115
3.2 Outlook for electricity access 116
Table of Contents 9
3.3 Outlook for electricity demand 118
3.3.1 Electricity demand growth by sector 120
3.3.2 Electricity demand growth by region 122
3.4 Outlook for electricity supply 126
3.4.1 On-grid supply 128
3.4.2 Role of decentralised systems to reach universal access to
electricity 134
3.5 Reliability 135
3.6 Affordability 139
3.7 Investment needs for reliable, sustainable and affordable power 141
3.8 Sources of finance for power investment in sub-Saharan Africa 143
3.8.1 Investment framework and market structure 143
3.8.2 Private financing is concentrated in IPPs, mostly in
South Africa 145
3.9 Closing the investment and financing gap 147
3.9.1 Improve the financial and operational performance of
utilities 147
3.9.2 Enhance policy and regulatory frameworks to improve
bankability 149
3.9.3 Create supportive enabling environments for rural electricity
access 150
3.9.4 Strengthen provision of long-term finance 152
4 Natural gas and resource management 155

4.2 The role of natural gas in Africa’s energy mix 159
4.2.1 Prospects for gas in key regions 161
4.2.2 Outlook for natural gas demand, production and
infrastructure developments in Africa 168
4.2.3 Conclusions 170
4.3 Maximising the value of Africa’s resources 171
4.3.1 Outlook for fossil fuel production 173
4.3.2 Strategic responses for resource-holders in Africa 176
4.3.3 Conclusions 184

5 Implications for Africa and the world 187
5.2 Implications for the world 187
5.2.1 Africa as a key driver for global energy demand growth 188
5.2.2 Mobilising investment for reliable power: challenging but
achievable 192
5.2.3 Not a major emitter, but climate change matters greatly
for Africa 194
5.2.4 Achieving sustainable development goals requires
Africa’s success 200
6 Regional and country energy profiles 205

6.1 Sub-Saharan Africa 208
6.2 Angola 212
6.3 Côte d’Ivoire 216
6.4 Democratic Republic of the Congo 220
6.5 Ethiopia 224
6.6 Ghana 228
6.7 Kenya 232
6.8 Mozambique 236
6.9 Nigeria 240
6.10 Senegal 244
6.11 South Africa 248
6.12 Tanzania 252
Annexes
Annex A. Tables for scenario projections 257
Annex B. Definitions 263
Annex C. References 275
Table of Contents 11
Executive Summary
How Africa meets the energy needs of a young, fast growing and increasingly urban
population is crucial for the continent’s – and the world’s – economic and energy future.
One-in-two people added to the global population between today and 2040 is set to be
African, and by 2025, Africa’s population exceeds that of both India and China. The
continent’s urban population is set to grow by more than half a billion over that period,
much higher than the growth seen in China’s urban population during the country’s two-
decade economic and energy boom. These profound demographic changes are set to drive
economic growth, infrastructure development and, in turn, energy demand.
Five years since its first special report on Africa, the International Energy Agency (IEA) has
updated and upgraded its work in this new World Energy Outlook Special Focus. This
reflects not only Africa’s increasing importance in global energy affairs but also the
deepening relationships between African energy decision makers and the IEA. This report,
the most comprehensive to date, contains a unique richness of data and analysis. The
centrepiece is a set of detailed, comprehensive outlooks covering 11 sub-Saharan
countries1 that were developed in consultation with our African partners.
Thanks to natural resource endowments and technology improvements, Africa could
pursue a much less carbon-intensive development model than many other parts of the
world have. The challenges and opportunities differ widely across a diverse continent. But
renewables, together with natural gas in many areas, are poised to lead Africa’s energy
consumption growth as the continent moves away from the traditional use of biomass that
currently accounts for almost half of final energy consumption.
Africa’s energy prospects depend on the way that government policies shape investment
flows and the availability and affordability of modern energy sources. Our analysis is
based on two scenarios:
 The Stated Policies Scenario reflects our measured assessment of today’s policy
frameworks and plans, taking into account the regulatory, institutional, infrastructure
and financial circumstances that shape the prospects for their implementation.
 The Africa Case is built on the premise of Agenda 20632, the continent’s inclusive and
sustainable vision for accelerated economic and industrial development. Faster
economic expansion is accompanied by the full achievement of key Sustainable
Development Goals by 2030. These include full access to electricity and clean cooking
and a significant reduction in premature deaths related to pollution.
1
These are: Angola, Côte d’Ivoire, Democratic Republic of the Congo, Ethiopia, Ghana, Kenya, Mozambique,
Nigeria, Senegal, South Africa and Tanzania.
2
Agenda 2063 was adopted in 2015 by the Heads of State and Governments of the African Union; it is the
continent’s strategic framework that aims to deliver inclusive and sustainable development.
Executive Summary 13
Africa drives global trends, but a lack of access persists
Whichever pathway Africa follows, the continent becomes increasingly influential in
shaping global energy trends. Growing urban populations mean rapid growth in energy
demand for industrial production, cooling and mobility. Energy demand in Africa grows
twice as fast as the global average, and Africa’s vast renewables resources and falling
technology costs drive double-digit growth in deployment of utility-scale and distributed
solar photovoltaics (PV), and other renewables, across the continent. With the growing
appetite for modern and efficient energy sources, Africa emerges as a major force in global
oil and gas markets. As the size of the car fleet more than doubles (the bulk of which have
low fuel efficiency) and liquefied petroleum gas (LPG) is increasingly used for clean cooking,
oil demand grows by 3.1 million barrels per day between today and 2040, higher than the
projected growth in China and second only to that of India. Africa’s growing weight is also
felt in natural gas markets and the continent becomes the third-largest source of global gas
demand growth over the same period.
A critical task for policy makers is to address the persistent lack of access to electricity
and clean cooking – and the unreliability of electricity supply. These have acted as brakes
on the continent’s development. Nearly half of Africans (600 million people) did not have
access to electricity in 2018, while around 80% of sub-Saharan African companies suffered
frequent electricity disruptions leading to economic losses. In addition, more than 70% of
the population, around 900 million people, lack access to clean cooking. The resulting
household air pollution from traditional uses of biomass is causing 500 000 premature
deaths a year. It also contributes to forest depletion resulting from unsustainable
harvesting of fuelwood, as well as imposing a considerable burden and loss of productive
time, mostly on women.
The momentum behind today’s policy and investment plans is not yet enough to meet
the energy needs of Africa’s population in full. In the Stated Policies Scenario, 530 million
people still lack access to electricity and nearly one billion have no access to clean cooking
in 2030. The continent’s ambition to accelerate an industrial expansion continues to be
hampered in many countries by unreliable energy supply. Only a handful of countries –
including South Africa, Ethiopia, Ghana, Kenya, Rwanda and Senegal – are successful in
reaching full access to electricity by 2030. Solid biomass remains a mainstay of the energy
mix as a primary fuel for cooking as clean cooking policies lag population growth and
premature deaths related to inhaling fumes from cooking end up only 2% below today’s
level by 2040.
The Africa Case points the way to a brighter future

The Africa Case outlines a way to lift these constraints, starting with the achievement of
full access to modern energy by 2030. In the case of electricity, this would require tripling
the average number of people gaining access per year from around 20 million today to over
60 million people. Grid expansion and densification is the least cost option for nearly 45%
of the currently deprived, mini-grids for 30% and stand-alone systems for around a quarter.

LPG is used by more than half of those gaining access to clean cooking in urban areas across
sub-Saharan Africa, while in the rural areas, home to the majority of those without access,
improved cookstoves are by far the preferred solution. Electrification, biogas, ethanol and
other solutions also play important roles.
A focus on energy efficiency can support economic growth while curbing the increase in
energy demand. In the Africa Case, although the size of the continent’s economy in 2040 is
four times larger than today, efficiency improvements help limit the rise in total primary
energy demand to just 50%. As a result, even though economic growth in the Africa Case is
significantly stronger than in the Stated Policies Scenario, energy use is actually lower. This
is linked to an accelerated move away from solid biomass as a fuel and the increased
efficiency of charcoal production and use – and to the wide application of electrification
and energy efficiency policies. These include fuel economy standards for cars and
two/three-wheelers, more efficient industrial processes, building codes and efficiency
standards for appliances and cooling systems.
Renewables push ahead to power Africa’s brighter future

Rising electricity needs, especially in sub-Saharan Africa, require a major expansion of the
power system. Electricity demand today in Africa is 700 terawatt-hours (TWh), with the
North African economies and South Africa accounting for over 70% of the total. Yet it is
the other sub-Saharan African countries that see the fastest growth to 2040. Electricity
demand more than doubles in the Stated Policies Scenario to over 1 600 TWh, and
reaches 2 300 TWh in the Africa Case as electricity supports an increasing range of
residential, service and industrial uses. Most of the additional electricity demand
stems from productive uses and middle- and higher-income households.
Renewables account for three-quarters of new generation, with a key question being
how fast solar will grow. Africa has the richest solar resources in the world, but has
installed only 5 gigawatts (GW) of solar PV, less than 1% of the global installed capacity. In
the Africa Case, solar PV overtakes hydropower and natural gas to become the largest
electricity source in Africa in terms of installed capacity (and the second largest in terms of
generation output). With additions across the entire region, solar PV deployment between
today and 2040 averages almost 15 GW a year, matching the average annual deployment in
the United States over the same period. Wind also expands rapidly in several countries that
benefit from high quality wind resources, most notably Ethiopia, Kenya, Senegal and South
Africa while Kenya is also at the forefront of geothermal deployment.
The development and reliability of Africa’s electricity sector will be shaped by progress in
improving power infrastructure, within and across borders. Supporting a tripling of the
electricity demand as envisaged in the Africa Case requires building a more reliable power
system and greater focus on transmission and distribution assets. A key priority is targeted
investment and maintenance to reduce power outages, a major obstacle to enterprise, and
to decrease losses from 16% to a level approaching advanced economies (less than 10%
today). In addition, some large power-sector projects – especially for hydropower – require
regional integration to go ahead: they would not proceed if assessed only on domestic
needs. That means building up the regulation and capacity to support Africa’s power pools
and strengthen regional electricity markets.
Africa needs a significant scale-up in electricity sector investment in generation and grids,
for which it currently ranks among the lowest in the world. Despite being home to 17% of
the world’s population, Africa currently accounts for just 4% of global power supply
investment. Achieving reliable electricity supply for all would require an almost fourfold
increase, to around $120 billion a year through 2040. Around half of that amount would be
needed for networks. Mobilising this level of investment is a significant undertaking, but
can be done if policy and regulatory measures are put in place to improve the financial and
operational efficiency of utilities and to facilitate a more effective use of public funds to
catalyse private capital. Developing the technical and regulatory capacity to support sector
reform policies, as well as Africa’s own financial sector, is also critical to ensure a sustained
flow of long-term financing to energy projects.
Natural gas can be a good fit for Africa’s industrial growth

Natural gas is facing a potential turning point in Africa. In North Africa, gas already meets
around half of the region’s energy needs, but in sub-Saharan Africa, it has thus far been a
niche fuel. The share of gas in the energy mix is around 5%, among the lowest in the world.
The future could be different. There have been a series of major discoveries in recent years,
in East Africa (Mozambique and Tanzania), Egypt, West Africa (Senegal and Mauritania) and
South Africa, which collectively accounted for over 40% of global gas discoveries between
2011 and 2018. These developments could fit well with Africa’s push for industrial growth
and its need for reliable electricity supply.
Developing gas infrastructure will be a major challenge because of typically small market
sizes and concerns about affordability. Nonetheless, the rapid deployment of renewables
leaves room for gas to grow as a flexible and dispatchable source of electricity. Outside the
power sector, the successful industrialisation foreseen in the Africa Case rests upon the
stable provision of energy, including for energy uses that are hard to electrify. Gas could be
well suited to these roles and, if it is not available, the alternatives in many cases would be
other, more polluting fossil fuels. Much will depend on the price at which gas becomes
available, the development of distribution networks (including small-scale liquefied natural
gas (LNG) distribution), the financing available for infrastructure and the strength of policy
efforts to displace polluting fuels.
In our projections, Africa becomes a major player in natural gas markets as a producer,
consumer and exporter. Gas production more than doubles to 2040 in the Stated Policies
Scenario. It rises further in the Africa Case, to support higher demand from power and
industry. The share of gas in Africa’s energy mix rises to around 24% in 2040 in the Africa
Case (close to the global average today). However, the growth in production is considerably
higher than the rise in demand, and Africa – led by Mozambique and Egypt – emerges as a
major supplier of LNG to global markets.

Energy transitions bring mixed implications for Africa
Development models in Africa that are highly dependent on hydrocarbon revenues are
coming under increasing pressure. Africa has abundant natural resources and the
associated revenues could be an important motor for development. However, changing
global energy dynamics mean that resource-holders cannot assume that their oil resources
will translate into reliable future revenues. This year’s outlook incorporates higher shale oil
production in the United States, which is providing very strong competition for lighter
African crudes. Accelerated energy transitions would result in lower demand and prices for
hydrocarbons and cut sharply into future revenues. Our analysis underscores the need for
strategic thinking on future investments, transparent resource revenue management and
efforts to reform and diversify economies.
Energy transitions are opening up new opportunities for a different set of strategic
resources. Africa is home to many of the mineral resources that are critical in driving global
energy transitions. The Democratic Republic of the Congo accounts for two-thirds of global
cobalt production and South Africa produces 70% of the world’s platinum. Rising demand
for the minerals that can support global energy transitions offers an opportunity for
minerals-rich countries in Africa, but responsible stewardship of these resources is vital.
These supply chains are coming under increasing scrutiny, and adequate oversight will be
needed to ensure that revenues produce visible positive results for local communities and
that negative impacts on the environment are minimised.
Climate change matters in Africa, making resilient policy decisions critical

Africa has been a minor contributor to global greenhouse gas emissions, and this remains
the case to 2040 in all our scenarios. To date, energy-related carbon dioxide (CO₂)
emissions in Africa represented around 2% of cumulative global emissions. Although Africa
experiences rapid economic growth, its contribution to global energy-related CO₂ emissions
increases to just 4.3% over the period from today to 2040 in the Stated Policies Scenario. In
the Africa Case, the continent’s share of cumulative global emissions rises further by just
0.2 percentage points to 2040 despite an economy that grows even more quickly. Looking
beyond CO₂, the transition away from the inefficient combustion of biomass for cooking in
the Africa Case leads to same levels of greenhouse gas (GHG) emissions as in the Stated
Policies Scenario as the increase in CO₂ emissions is offset by reductions in other GHGs
(methane and nitrous oxide).
But Africa is in the front line when it comes to the effects of a changing climate on the
energy sector. Today, Africa has some of the lowest ownership levels of cooling devices of
any region, despite almost 700 million people living in areas where the average daily
temperature exceeds 25 degrees. By 2040, this number approaches 1.2 billion as
population expands and average temperatures increase with climate change. Without
appropriate regulations on the type of equipment used for cooling, this would create a very
strong increase in electricity demand. Increased frequency and intensity of extreme
weather events such as droughts and floods is set to lead to more variability in generation
output, notably hydropower. In Zambia, for example, a severe drought in 2015 led to a
drop in output at the largest hydropower plant, resulting in power blackouts. Uncertainty
over the impact of climate change on the region’s hydrology underlines the need to build
up a diverse power mix and enhance regional connections. Planning and investment
decisions for energy infrastructure need to be climate resilient. Outside the energy sector,
Africa’s ecosystems already suffer disproportionately from climate change and are exposed
to increased risks to food, health and economic security.
Policies will play a crucial role in determining Africa’s energy future

Africa’s energy future is not preordained: many pathways are possible, but effective
policy choices can guide the continent to a more inclusive and sustainable energy future
and accelerate its economic and industrial development. The choices that lead in this
direction vary, reflecting the different resource endowments and starting points across a
very diverse African energy landscape. Some have full access to modern energy services
within their grasp, while others have much further to go, or are struggling with instability or
a legacy of conflict. But there are reasons for optimism, both from the dynamism of Africa’s
energy sector and from the technologies that offer a cost-effective way to meet rising
demand in a sustainable way. Whether and how African countries take advantage of these
opportunities will depend in large part on the way that energy policies evolve. With the
right institutional and policy foundations, a well-functioning energy sector can be the
cornerstone of economic development and make a huge difference in the lives of Africa’s
people.

Introduction
Five years after a first special report on Africa in the World Energy Outlook-2014
(WEO-2014) series, the IEA has updated and expanded its analysis of the energy outlook for
the continent in this new report. The renewed focus on Africa in this year’s World Energy
Outlook reflects Africa’s increasing importance in global energy affairs and the deepening
relationships between African energy decision makers and the IEA. Institutionally, South
Africa and Morocco have become IEA Association countries, and the IEA concluded a new
strategic partnership on energy with the African Union in 2018.
At the heart of this Special Focus report are analyses at country level that break new
ground and give important policy insights for global and African energy stakeholders. We
carried out quantitative analysis of a number of important factors and used the results to
develop modelling for eleven sub-Saharan countries for the first time. This enabled us to
produce detailed, comprehensive, data-rich profiles for these countries and draw
implications for Africa and the world. The profiles provide much greater granularity than
the regional analysis carried out in the WEO-2014 Special Report. We draw on these
profiles in the analysis and discussion in the chapters that follow, and present the detailed
output of our analysis for each country in an easy-to-read graphic format in Chapter 6.
This introduction covers:
 Context: Africa’s population is growing rapidly. Its economies have the potential to do
the same, and their demand for energy is set to grow very fast. Africa is also an
important supplier of energy and has seen major recent gas discoveries. At the same
time it still faces significant challenges in terms of access to electricity and clean
cooking for all.
 Structure: This Special Focus begins by looking at the energy landscape of Africa today
and then moves on to look at a variety of future energy challenges.
 Focus countries and country profiles: The report looks at Africa as a whole, but
focuses on sub-Saharan Africa, and on the eleven countries selected for detailed
country profiles. These profiles reflect modelling capabilities developed for the first
time for this report.
 Scenarios: We use the Stated Policies Scenario, as elsewhere in the WEO, and a new
Africa Case developed for this Special Focus that reflects Agenda 2063, in which African
leaders set out their vision for the future growth and development of the continent.
Introduction 19
Context
In 2000, Africa’s population of around 820 million accounted for about 13% of the world’s
6.1 billion people. In 2018, this share had increased to around 17%, as its population
expanded at more than twice the global rate. Africa has the world’s fastest growing and
youngest population. The last two decades have seen the number of people living in cities
increase by 90% and this trend continues over the next two decades. By 2040, an additional
580 million Africans will be living in cities, an amount greater than the entire population of
the European Union today, and a pace of urbanisation that is unprecedented.
Despite its large and growing population, Africa accounts for a very small share of global
energy sector investment. In 2018, around $100 billion was invested in the energy sector in
Africa, or about 5.5% of the global total. Of this, $70 billion was invested in fossil fuels and
$13 billion in renewables. Another $13 billion was spent on electricity networks.
Africa accounts for a relatively small, but nonetheless growing share of the world’s carbon
dioxide (CO₂) emissions. In 2010, the continent accounted for 3.3% of global energy-related
CO₂ emissions; by 2018 this share had increased to 3.7% or around 1.2 gigatonnes (Gt) CO₂.
North Africa accounted for the largest share of the continent’s energy-related
CO₂ emissions, with 40% or around 490 million tonnes (Mt) CO₂ and South Africa accounted
for 35% (420 Mt CO₂).
Figure I.1 ⊳ Africa’s share of selected global indicators
2000
GDP 2010
2018
Energy 2000
2010
demand 2018
2000
Population 2010
2018
Population relying 2000
on traditional 2010
use of biomass 2018
Population 2000
without access 2010
to electricity 2018
10% 20% 30% 40% 50% 60% 70%
Africa accounts for a low share of the world’s energy demand

and a high share of the population without access to modern energy services

Africa is among the regions most exposed to the effects of climate change. Its ecosystems
already suffer disproportionately from global climate change and future impacts are
expected to be substantial. This will have implications for food security, migration and
ultimately development. All African countries signed the Paris Agreement and, through
their Nationally Determined Contributions (NDCs), they committed to contribute to the
global effort to mitigate GHG emissions (IPCC, 2019). The majority of countries that have
already enhanced the ambition stated in their NDCs in 2019 are in Africa.
The continent has made progress on metrics such as economic growth, income per capita,
educational attainment, access to clean drinking water, child mortality and life expectancy.
While the region is also home to a growing share of the world’s energy-poor, new
renewable energy technologies, innovative digital technologies and finance tools halted the
growth in the number of people without access to electricity in 2013, giving new impetus
towards achieving the UN Sustainable Development Goal 7 (access to affordable, reliable
and sustainable modern energy for all by 2030). In East Africa, countries such as Kenya,
Ethiopia and Uganda have made remarkable progress in providing modern energy services
to millions over the past five years. Nonetheless, much remains to be done to deliver
universal access to electricity, and in particular to expand access to clean cooking, where
progress is being outpaced by population growth.
Africa’s vast natural resources mean that low-cost clean energy technologies have plenty of
potential. Solar is rightly seen as a huge opportunity for Africa, both at utility-scale and off-
grid. Deployment is low today, but it is expanding fast. Recent new utility-scale capacity
additions include the first phases of the 1.6 gigawatt (GW) solar photovoltaics (PV) park at
Benban in Egypt and the 510 MW Noor solar concentrating solar power development in
Morocco, both of which are among the world’s largest of their kind. In East Africa, Kenya
commissioned the 310 MW Lake Turkana Wind Power plant and the 185 MW Olkaria
Geothermal Power Plant, both among Africa’s largest in their respective technologies.
Large-scale projects have successfully been confirmed in other countries and many more
are under way in Angola, Ethiopia, South Africa, Senegal, Uganda and Zambia, among
others.
There have been a number of natural gas discoveries, most notably in Mozambique and
Tanzania but also in Egypt, Mauritania, Senegal and South Africa. These finds accounted for
over 40% of global gas discoveries between 2011 and 2018 and the majority have occurred
since our last focus on Africa in 2014 (Box I.1). The possible benefits are many: natural gas
can provide the continent with an additional source of electricity for baseload and flexibility
needs, it can supply feedstock for industrial growth and bring new export opportunities and
revenues; and, when combined with the continent’s huge renewable energy potential, gas
can offer a new pathway towards the provision of modern energy services for all. In
addition, many of the minerals essential to modern energy transitions are found in large
quantities in Africa, including uranium and strategic metals and minerals such as cobalt,
copper and platinum.
Introduction 21
Box I.1 ⊳ A retrospective assessment: Africa Energy Outlook 2014
The New Policies Scenario in the Africa Energy Outlook (IEA, 2014) provided a set of
projections that were based on the policies firmly in place or planned at the time (the
same principles that apply to this edition’s Stated Policies Scenario). When we look back
at those we find:
 Electricity access has progressed more rapidly than projected in 2014, as countries
have stepped up their policy efforts in the meantime. A combination of lower cost
renewable technologies and new business models helped to facilitate progress. In
the case of clean cooking, progress was not as strong as projected in 2014.
 Since 2014, accelerated global deployment has made renewable technologies a
much more cost-effective option to support Africa’s energy and development
objectives. The outlook for natural gas is also affected by new discoveries not just
in Mozambique and Tanzania (covered in the 2014 report) but also in Egypt,
Mauritania and Senegal and South Africa.
 Another consideration is energy prices. The 2014 report was written at a time
when oil prices were relatively high and the focus of the analysis was on
responsible and transparent management of revenues. Since then, the net income
from oil and gas production has been very volatile, with the impacts of low fossil
fuel prices amplified by domestic challenges in major producer economies. The
combined net income from oil and gas production of the top-ten producing
countries in Africa declined by 70% between 2014 and 2016.
Structure
The first part of this Special Focus on Africa, Chapter 1, analyses the changing dynamics and
energy landscape of Africa today. It sets out the existing economic and demographic
architecture, the continent’s key energy demand and supply trends, the scale of its energy
resources and assesses the factors that are likely to influence the future energy landscape.
The second part, consisting of three chapters, seeks to capture a sense of the continent’s
diversity by exploring in detail a number of themes, which touch on some of the most
fundamental energy challenges facing sub-Saharan Africa. These include the outlook for
energy demand, with a focus on urbanisation, industrialisation and access to clean cooking
(Chapter 2); access to electricity and reliable power together with investment and financing
for power supply (Chapter 3); and natural gas and resource management (Chapter 4).
Woven through these themes are insights on gender and other forms of social inequality,
which present major impediments for optimising economic and human development in
African countries.
Chapter 5 sets out the implications for Africa and the global energy sector of the analysis
contained in the preceding chapters. Chapter 6 presents a comprehensive profile of the
energy sector not only in sub-Saharan Africa but in each of our eleven focus countries.

These profiles provide a snapshot of the energy sector in each and help identify not only
the challenges ahead but also highlight the huge potential of the continent’s plentiful
natural resources.
Focus countries and country profiles

This special report covers Africa as a whole, but much of the detailed analysis and
discussion focusses on sub-Saharan Africa and on the eleven countries highlighted in our
country profiles: Angola, Côte d’Ivoire, Democratic Republic of the Congo (DR Congo),
Ethiopia, Ghana, Kenya, Mozambique, Nigeria, Senegal, South Africa and Tanzania. These
eleven sub-Saharan countries are a diverse group: some are among the world’s fastest
growing economies while others are among the poorest in the world. Together, they
represent three-quarters of sub-Saharan Africa’s 2018 gross domestic product (GDP) and
energy demand, and two-thirds of population. They also account for the majority of
Africans without access to modern energy services. They are also home to a large share of
the continent’s abundant energy and mineral resources, with the potential not only to
transform Africa, but also to make a substantial contribution to the world’s energy
transitions.
For the purpose of this Special Focus, North Africa, South Africa, ten additional sub-Saharan
countries and the rest of sub-Saharan Africa have been modelled separately. Each of these
countries and groupings was assessed on the basis of a number of factors including:
demographics (population, urban population, age profile); economy (size and structure of
the economy, GDP per capita, level of foreign direct investment, transport infrastructure);
key energy indicators (total final energy consumption, energy consumed by end-use,
consumption of energy per capita), scale of power sector (installed generation capacity,
renewable energy capacity and potential, level of electricity exports and trade); the level of
access to both electricity and clean cooking; fossil fuel resources; and the full range of
energy and environment policies and strategies. For ten African countries (except South
Africa), this led to the development of detailed modelling capabilities for these countries
for the first time.
Understanding the scenarios

This Special Focus provides a framework for analysing the outlook for Africa’s energy
sector, particularly sub-Saharan Africa. It sets out what the future could look like based on
different scenarios or pathways, with the aim of providing insights to inform decision
making by governments, companies and others concerned with energy. The two scenarios
assessed in this Special Focus are:
The Stated Policies Scenario provides a measured assessment of where today’s policy
frameworks and announced policies, together with the continued evolution of known
technologies, might take the energy sector in sub-Saharan Africa in the coming decades.
Given that announced policies are by definition not yet fully reflected in legislation or
Introduction 23
regulation, the prospects and timing for their full realisation are based upon our
assessment of the relevant political, regulatory, market, infrastructural and financial
constraints. This scenario does not focus on achieving any particular outcome: it simply
looks forward on the basis of announced policy ambitions in various sectors.
The Africa Case is built on the premise of Agenda 2063 (Box I.2), and takes into account
each country’s own vision for economic growth, based on regional economic blueprints and
typically incorporating an accelerated industrial expansion. Enhanced economic growth
also increases the means to achieve the ambitions included in energy master plans and
other policy announcements, so these are more fully realised than in the Stated Policies
Scenario (Table I.1). The Africa Case also incorporates key sustainable development goals
by 2030, including achieving full electricity and clean cooking access as well as significant
reductions in pollution-related premature deaths. As a tangible representation of the
Agenda 2063 vision, it presents a pathway to attain inclusive and sustainable economic
growth and development.
Box I.2 ⊳ Agenda 2063: the future that Africa wants
In 2015, the Heads of State and Governments of the African Union adopted Agenda
2063. It sets out a vision for “an integrated, prosperous and peaceful Africa, driven by
its own citizens and representing a dynamic force in the international arena”. Closely
linked to the United Nations Sustainable Development Goals, it is an ambitious vision
and one which will require significant political will if its goals are to be realised.
Agenda 2063 builds on previous Pan-African initiatives, but is distinct in many respects:
it sets out clear goals, implementation plans and targets alongside elements of
accountability; it identifies key flagship programmes as well as monitoring and review
mechanisms; and it proposes a clear resource mobilisation strategy. Successful delivery
of Agenda 2063 is likely to depend on good governance, transparency and effective
intra-African co-ordination, among other things. It will also depend on resources being
available to implement it and in particular on the mobilisation of private sector
resources.
Agenda 2063 emphasises the implementation of the Grand Inga Dam Project as a key
development priority and a means to support regional power pools and help transform
the continent from traditional to modern sources of energy. Energy-related targets
contained in the framework for the first ten years include increasing access to
electricity by at least 50% compared to 2013 levels and increasing the efficiency of
household energy use by at least 30% before 2023.
The Africa Case sees an annual average rate of growth in gross domestic product (GDP) of
6% across sub-Saharan Africa, significantly higher than the 4.3% assumed in the Stated
Policies Scenario. The population assumptions are held constant across the two scenarios
(Table I.2); these are based on the medium variant of the United Nations population
projections.

Table I.1 ⊳ Real GDP growth assumptions by scenario
(compound average annual growth rate)
Country/Region 2000-2018 2018-2040

Stated Policies Africa
Scenario Case
North Africa 3.5% 3.6% 4.8%
South Africa 2.7% 2.5% 3.3%
Other sub-Saharan Africa 5.4% 5.0% 7.3%
Angola 5.8% 3.3% 5.3%
DR Congo 5.3% 5.5% 8.7%
Côte d'Ivoire 3.6% 5.3% 7.9%
Ethiopia 9.0% 6.5% 8.9%
Ghana 6.3% 3.9% 6.3%
Kenya 4.8% 5.9% 9.0%
Mozambique 7.1% 6.0% 8.1%
Nigeria 6.3% 3.4% 5.3%
Senegal 4.6% 6.5% 8.7%
Tanzania 6.5% 5.6% 9.3%
Africa 4.3% 4.3% 6.1%
Note: GDP in PPP terms, $2018.
Table I.2 ⊳ Population assumptions

Total population (million) 2018-2040
2018 2040 Delta (million) CAAGR*
North Africa 196 263 67 1.3%
South Africa 57 71 14 1.0%
Other sub-Saharan Africa 1 034 1 761 728 2.5%
Nigeria 196 329 133 2.4%
Ethiopia 108 173 65 2.2%
DR Congo 84 156 72 2.8%
Tanzania 59 108 49 2.8%
Kenya 51 79 28 2.0%
Angola 31 60 29 3.1%
Mozambique 31 55 24 2.7%
Ghana 29 44 15 1.9%
Côte d'Ivoire 25 42 17 2.4%
Senegal 16 28 12 2.5%
Africa 1 287 2 095 808 2.2%
* CAAGR = compound average annual growth rate.
Introduction 25
Chapter 1
Africa today
Viewing Africa through a new lens?
S U M M A R Y
• The pace of change in Africa’s energy sector has quickened, imparting to the
continent a growing sense of confidence despite many setbacks. Africa’s economy is
also on an upward trajectory, with gross domestic product (GDP) likely to rise by
around 4% this year. East Africa looks to be the fastest-expanding region today, led
by Rwanda, Ethiopia, Kenya, and Tanzania. The way in which the energy sector
develops will have a crucial influence on Africa’s future.
Figure 1.1 ⊳ Selected indicators for Africa, 2000, 2010, 2018
Population GDP Energy demand

1 500 9 000 900
Billion dollars (2018)
Mtoe
Million
1 000 6 000 600
500 3 000 300
2000 2010 2018 2000 2010 2018 2000 2010 2018

North Africa South Africa Other Africa
Africa’s urban population is expanding fast

while energy services and GDP struggle to keep pace
Note: GDP = Gross domestic product in PPP terms, $2018.
• The number of people gaining access to electricity in Africa doubled from 9 million a
year between 2000 and 2013 to 20 million people between 2014 and 2018,
outpacing population growth. As a result, the number of people without access to
electricity, which peaked at 610 million in 2013, declined slowly to around
595 million in 2018. Recent progress has been led by Kenya, Ethiopia and Tanzania,
which accounted for more than 50% of those gaining access. However, sub-Saharan
Africa’s electrification rate of 45% in 2018 remains very low compared with other
parts of the world.
• Since 2015, only seven million people have gained access to clean cooking in
sub-Saharan Africa, meaning that the number of people without access increased to
over 900 million in 2018 as population growth outpaced provision efforts. Progress
has been strongest in parts of West Africa such as Côte d’Ivoire and Ghana which
Chapter 1 | Africa today 27

have promoted liquefied petroleum gas (LPG). However, the problem remains acute
and Sub-Saharan Africa is one of the only regions worldwide where the number of
people without access to clean cooking continues to increase.
• Energy demand in Africa has been driven by the growing needs of North Africa,
Nigeria and South Africa. There are also very strong regional variations. Countries
such as Democratic Republic of the Congo (DR Congo), Africa’s fourth most populous
country, and Mozambique have seen their primary energy demand increase by over
50% between 2010 to 2018, whereas others such as Côte d’Ivoire and Ghana have
witnessed only a gradual increase in energy demand (or even a decline).
• With a fifth of the world’s population, Africa accounts for only 6% of global energy
demand and little more than 3% of electricity demand. Average energy consumption
per capita in most African countries is well below the world average and largely
comparable to that of India. Bioenergy is the largest source of energy in Africa
today, meeting 45% of primary energy demand and over half of final energy
consumption.
• Africa has plentiful renewable energy resources and its economic potential is
substantially larger than the current and projected power consumption of the
continent. Bioenergy, hydropower, solar and wind power account for the bulk of the
resources. East Africa also has rich geothermal resources. To date, limited use has
been made of this vast potential: Africa has only 50 gigawatts (GW) of renewable
capacity, mostly hydropower (36 GW). But this is changing: utility-scale projects
have entered service in Egypt, Ethiopia, Kenya, Morocco and South Africa.
Meanwhile, mini-grids, micro-grids and solar home systems are anchoring efforts to
bring modern energy services and new sources of productive employment to
remote populations, facilitated by digital technologies and payment tools.
• The future of natural gas in Africa is at an important juncture. Since 2010, there have
been major gas discoveries in every part of the continent: immense finds in East
Africa (Mozambique and Tanzania) were followed by more in Egypt, West Africa
(Mauritania and Senegal) and South Africa. While Africa accounts for 6% of global
gas production today, over 40% of global gas discoveries between 2011 and 2018
were in Africa. These resources offer new opportunities for Africa’s energy and
industrial development. The prospects for gas, however, hinge upon well-articulated
strategies to bring the discoveries into production and build infrastructure to deliver
gas to consumers at competitive prices.
• Africa is home to many of the minerals essential to the energy industry, for example,
DR Congo accounts for almost two-thirds of global cobalt production. The continent
also produces a large share of key minerals such as platinum (cars and fuel cells),
chromium (wind turbines) and manganese (batteries), which will play a major role in
powering the global energy transitions.

1.1 Context
1.1.1 Economic growth and industrialisation
1
Africa has experienced relatively low gross domestic product (GDP) growth since 2010, an
average of 3.1% per year compared with a global average of 3.5% per year. GDP per capita
in the continent is less than a third of the global average and in sub-Saharan Africa as low
as a fifth of the global average. Two countries, Nigeria (17%) and South Africa (12%)
account for a large portion of Africa’s economic activity. Recent growth in some countries
has been significantly influenced by their dependence on commodities. The greater this
reliance, the more severe the impact of the 2014 commodity price decline; and the greater
the fall, the more challenging the recovery (Figure 1.2). While countries such as Ethiopia,
Kenya and Rwanda have successfully boosted growth through public investment and a
growing services sector (AUC/OECD, 2018), Nigeria is only slowly pulling out of the
recession that was triggered by a combination of lower oil prices and production outages
associated with conflict (IEA, 2018a).
Figure 1.2 ⊳ Annual GDP growth rates in selected African economies
12%
10%
Selected other African economies
8%
6%
4% Selected commodity-dependent
African economies
2%
South Africa
0%
-2%
2010 2012 2014 2016 2018
Commodity-dependent economies in sub-Saharan Africa
have yet to recover fully from the commodity price fall in 2014
Note: Selected commodity-dependent economies are Algeria, Angola and Nigeria; Selected other African
economies are Ethiopia, Kenya, Rwanda and Senegal.
Despite this, the overall sub-Saharan economy has expanded by more than one-third since
2010, reaching more than $4.3 trillion in 2018. Growth in Nigeria and South Africa has
slowed, but GDP elsewhere is now growing at the fastest pace since 2013. GDP growth for
the continent as a whole is forecast to accelerate to 4% in 2019, up from an estimated 3.3%

in 2018, making it the second fastest-growing region in the world, after Asia. Some
countries are growing much faster than this average. In Ghana for example, the
International Monetary Fund estimates that GDP will rise by almost 9% in 2019, double the

pace of emerging economies as a whole, and well ahead of world growth (IMF, 2019).
Ethiopia, Côte d’Ivoire, Rwanda, Senegal and Tanzania all feature on the African
Development Bank Group’s list of the ten fastest-growing economies for 2018 (AfDB, 2019).
Foreign direct investment (FDI) into Africa rose by 11% to $46 billion in 2018, reversing
declines in 2016 and 2017 while FDI into sub-Saharan Africa increased by 13% to $32 billion
(UNCTAD, 2019).
North Africa and South Africa are relatively industrialised, but other sub-Saharan African
countries represent only a small share of global industrial production, and industry is
hampered in many countries by unreliable electricity supply and high energy costs. The
contribution of different sectors to GDP and employment varies significantly between
individual economies, but for sub-Saharan Africa as a whole the relatively low share of
employment in industrial sectors stands out. By contrast, services contribute 55% to the
economy and a third of employment, while agriculture accounts for only 18% of GDP but
well over half of employment (Figure 1.3).
Figure 1.3 ⊳ Shares of value added and employment by sector in

North Africa and sub-Saharan Africa, 2018
North Africa Sub-Saharan Africa Other dev. economies

100% Agriculture
80% Services
Industry
60%
40%
20%
Value Employment Value Employment Value Employment

added added added
Agriculture accounts for a very large share of employment in

sub-Saharan Africa even when compared to other developing economies
Incomes and personal wealth vary greatly across Africa, but sub-Saharan Africa is home to
some of the world’s poorest people. While global poverty rates have been reduced by more
than half since 2000, and good progress is being made in many African countries such as
DR Congo, Ethiopia and Nigeria, more than 40% of the population in sub-Saharan Africa
continues to live below the poverty line on an income of less than $1.90 a day (UN, 2019a).
Sub-Saharan Africa also remains one of the most unequal regions in the world. Half of the
twenty most unequal countries in the world (measured by the Gini co-efficient) are in
sub-Saharan Africa (UNDP, 2017). Average per capita incomes across sub-Saharan Africa
range from over $10 000 in Mauritius and South Africa to less than $500 in the Central

African Republic, Madagascar and Niger. In 2018, average per capita GDP in sub-Saharan
Africa was around $4 000 ($2018 at power purchasing parity) compared to about $3 700 in
2010. This represents an average annual increase of around 1% a year over the period. This
1
compares with an average annual GDP per capita increase of 2.3% worldwide and 5.5% in
developing Asia over the same period. The small size of the annual increase of per capita
GDP in sub-Saharan Africa may seem hard to square with its faster GDP growth rate: the
reason for the difference is that the population of sub-Saharan Africa grew rapidly over the
period.
1.1.2 Demographics and urbanisation

In 2000, Africa’s population of 817 million accounted for just over 13% of the world’s
6.1 billion people. By 2018, this share had increased to around 17%, as Africa’s population
expanded at more than twice the global rate to reach almost 1.3 billion, of which almost
85% or 1.1 billion live in sub-Saharan Africa. Eleven countries account for almost two-thirds
of sub-Saharan Africa’s population today (Figure 1.4). The average age of the population of
Africa is very young: in 2017, the median age was 17 while children under age 15 accounted
for 41% of the population and 42% of the population of sub-Saharan Africa (UNDESA,
2019).
Almost 60% of Africa’s population lives in rural areas although an increasing share is
moving to the expanding urban areas. Africa already has two megacities in sub-Saharan
Africa (Kinshasa and Lagos) and another in North Africa (Cairo). There are another five large
cities on the continent with a population of between five and ten million each: Alexandria,
Dar es Salaam, Johannesburg, Khartoum and Luanda (UNDESA, 2018).1 Of these, Dar es
Salaam and Luanda are likely to become sub-Saharan Africa’s next megacities. The
implications of an increasingly urban population for the energy sector are profound. In
general, urban residents tend to consume more energy than those in rural areas, in large
part because of differences in income levels. Smart urban planning and sustainable
development offer a huge opportunity to shape patterns of future energy use. However,
there are also likely to be major challenges arising from further strains on air quality,
housing, transport, public utilities and sanitation (see Chapter 3).
The gender equality landscape in African countries is complex and sometimes

contradictory, presenting both challenges and opportunities for the future. Nearly one-in-
four households in Africa are headed by a woman: those in Southern Africa are most likely
to be headed by a woman, while households in West African countries are least likely to be
headed by a woman (Van de Valle, 2015). The percentage of women elected to parliament
in many African countries, (e.g. Rwanda, Namibia, South Africa and Senegal) is among the
highest in the world (IPU, 2019). Countries such as Mauritius, Seychelles and South Africa
have female literacy rates on par with or exceeding those in many developing and emerging
1
Large cities are generally defined as having between five and ten million inhabitants and megacities as
having ten million or more inhabitants.

economies. Conversely, sub-Saharan Africa contains nine of the ten countries with the
lowest levels of female literacy in the world. The complicated gender terrain in sub-Saharan
Africa, evidenced by the existence of high levels of disparity between different groups of
women as well as between regions and countries, has important implications for access to
energy and for socio-economic development.
Figure 1.4 ⊳ Share of urban/rural population in sub-Saharan Africa, 2018
Other Nigeria Ethiopia
Rural
Urban Rural Urban
DR Congo South Africa Kenya
Rural Urban Rural
Rural Rural Urban

Ghana Côte
Urban d'Ivoire
Mozambique Angola
Urban
Rural
Tanzania Urban Urban
Rural Rural
Urban
Rural
Senegal
Urban Rural Urban Rural Urban
Eleven countries account for almost two-thirds of

sub-Saharan Africa’s 1.1 billion people today
1.1.3 Infrastructure and investment

Infrastructure is an essential building block for economic development and quality of life,
but Africa, especially sub-Saharan Africa, lags behind other developing economies in
virtually all aspects of infrastructure quality. Over the past three decades, the level of
per capita power generation capacity in sub-Saharan Africa has remained flat, whereas in
India and Southeast Asia (which had less generation capacity per capita than sub-Saharan
Africa in 1990) it has grown fourfold. Sub-Saharan Africa has made relatively good progress
on telecommunications infrastructure, but still compares unfavourably with other

developing economies. Paved road network density has remained unchanged over the past
three decades despite the growth in population and trade, owing mainly to continued
under-investment in road expansion, maintenance and rehabilitation (Figure 1.5).
1
Figure 1.5 ⊳ Infrastructure quality developments in selected regions
Energy Telecoms Transportation

MW of power generation Number of fixed and mobile km of paved road per
capacity per million people subscriptions per person km2 of land area
800 1.6 0.2
400 0.8 0.1
1990 2018 1990 2017 1990 2011

Sub-Saharan Africa C & S America Southeast Asia India
Slow infrastructure development in sub-Saharan Africa

shows a stark contrast with progress in other developing economies
Note: C&S America = Central and South America; MW = megawatt.

Sources: International Telecommunications Union Statistics; World Bank World Development Indicators
Database.
Making up the deficit of energy infrastructure in Africa will require a massive ramp-up in
investment, but actual spending trends have been moving in the opposite direction. Energy
supply investment in sub-Saharan Africa has dropped by over 30% since 20112, and oil and
gas investments have more than halved because of low oil prices and investor concerns
about regulation and security in major producing countries. Power supply investment
registered strong growth until 2014, but has since stalled. The one bright spot has been
rising investment in solar photovoltaics (PV), which is set to surpass that in hydropower for
the first time in 2019, according to early data. Nonetheless, levels of spending still fall
significantly short of what would be needed in the Stated Policies Scenario, particularly in
the power sector (Figure 1.6).
Attracting capital for oil and gas projects in sub-Saharan Africa has generally been
hampered by uncertainties around fiscal and regulatory frameworks - the design of local
content rules has been a particular source of contention (Box 1.1). Moreover, difficulties in
reaching agreement on contractual terms have often led to reliance in practice on a
2
Energy supply investment includes capital spent on building infrastructure for fuel supply (extraction,
processing and transportation of oil, gas, coal and biofuel) and power supply (generation, networks and
storage).

handful of large companies that have the capacity to bear the risks. As a result, investment
in oil and gas in sub-Saharan Africa has largely been driven by international oil companies.
This contrasts with the prevailing trend in many other resource-rich countries where
domestic companies, and in particular national oil companies (NOCs) take the lead. In those
cases where sub-Saharan countries have established a NOC, they have generally not been
effective in accelerating resource developments in the country due to their limited financial
capacity and lack of technical expertise in handling complex projects (see Chapter 4). The
lack of a competitive service industry is another constraint that has weighed on
development costs. The limited attractiveness of the domestic market also means that
most spending in oil and gas has been directed at export-oriented projects (e.g. upstream
and liquefied natural gas) rather than projects geared towards domestic markets (e.g. gas
pipeline, refineries).
Figure 1.6 ⊳ Historical energy supply investment and average by sector in

sub-Saharan Africa in the Stated Policies Scenario
80
Fuel supply
Coal and biofuels
60 Gas
Oil
40 Power
Fossil fuels
20 Low carbon
Networks
2011 2012 2013 2014 2015 2016 2017 2018 Average needs
(2019-40)
Investments in fuel supply would need to increase by 60% from today’s levels to meet
needs; investments in power would need to grow by two-and-a-half times through to 2040
Investment in power infrastructure in sub-Saharan Africa has mainly been financed by state
budgets with substantial contributions from international donors. Public and international
development finance collectively accounted for over 90% of the capital committed to
power infrastructure in 2017 (ICA, 2017). While public sources of finance have an important
role to play, they are unlikely to be sufficient to address the significant investment gaps
that exist, and need to be supplemented by private sector financing. Africa has so far had
limited success in mobilising private finance. Between 2013 and the first-half of 2018,
power sector investment based on private participation in infrastructure (PPI) models in
sub-Saharan Africa amounted to around $4.5 billion per year on average, less than 10% of
the annual needs between today and 2040. Most of the region’s PPI investment has gone
to a handful of countries with South Africa alone accounting for more than half.

Ultimately whether projects can attract financing depends on whether developers and
investors believe that they will deliver adequate returns and the timely repayment of debt
to lenders. This requires a sound investment framework (e.g. tariff schemes, institutional
1
and regulatory structures) as well as a robust contracting framework (e.g. offtake
agreements and financing structures) to manage risks around future cash flows (see
Chapter 3). The role of public and development finance is also important: these sources can
not only provide necessary capital, but also encourage private sector investment through
targeted interventions such as risk sharing, liquidity support and take-out financing.
Outside South Africa, public and development finance has not been very effective in
catalysing private capital, suggesting that much more needs to be done to plug the
investment gaps in power and energy infrastructure (see Chapter 5).
Box 1.1 ⊳ Governance and policy frameworks
Good governance is closely correlated with faster growth, higher investment and faster
poverty reduction. The World Bank Governance Indicators show that there was little to
no progress in institutional quality across sub-Saharan Africa from 2000 to 2015 (World
Bank, 2018). Progress was however recorded in many countries on perceived
corruption. Côte d’Ivoire and Senegal, for example, are among the countries that
improved their position on the Corruption Perceptions Index while, Angola, Nigeria,
Botswana, South Africa and Kenya all displayed some promising developments
(Transparency International, 2019).
Stable and effective governance and regulatory frameworks are crucial for increasing
competition and attracting investments in the energy sector, and weak governance and
regulatory frameworks at national and sub-national levels continue to impede
performance in the energy sector. A key issue is the need for transparent and
responsible management of hydrocarbon revenues (discussed in more detail in
Chapter 4).
1.2 Access to modern energy

Access to modern energy is a central pillar of efforts to reduce poverty and support
economic growth in sub-Saharan Africa. Modern household energy services have two
components: first, access to clean cooking facilities, where progress remains slow, with
around 900 million people without access today; second, access to electricity, where there
has been strong progress in several countries over the past decade but almost 600 million
people in sub-Saharan Africa remain without access today (Box 1.2). Beyond households,
gaining access to modern energy services is also essential for businesses, farmers and
community buildings.

Box 1.2 ⊳ Defining and tracking household energy access
The IEA defines a household as having energy access when it has reliable and affordable
access to both clean cooking facilities and electricity, which is enough to supply a basic
bundle of energy services initially, and with the level of service capable of growing over
time (IEA, 2019a).3 We consider that this basic bundle of electricity services should
encompass, at a minimum, several lightbulbs, phone charging, a radio and potentially a
fan or television. Access to clean cooking facilities means access to (and primary use of)
modern fuels and technologies, including natural gas, liquefied petroleum gas (LPG),
electricity, bioethanol and biogas, or improved biomass cookstoves which deliver
significant improvements4 compared with basic biomass cookstoves and three-stone
fires traditionally used in some developing countries. This definition of energy access
serves as a benchmark to measure progress towards Sustainable Development Goal
(SDG) 7.1 and as a benchmark for our forward-looking analysis.
The World Energy Outlook (WEO) electricity and clean cooking access databases are
updated annually. They contain the most recent country-level data on the share of
national, urban and rural households with electricity and clean cooking access for the
2000-18 period. The Access to Electricity Database sources data, where possible, from
government-reported values for household electrification.5 It takes into account
connections to the main grid, and where available access through decentralised
systems able to supply the basic energy services mentioned above. Despite their
development benefits, "pico solar" products, mainly solar lanterns which may include
mobile phone chargers, are considered to be below the minimum threshold to count as
having access.
Access to electricity is considered to be binary (a household either has or does not have
access) as the availability and quality of reported data limits the capacity to describe the
level of service, reliability and affordability.6 Within these limits, this Special Focus
3
A full description of the World Energy Outlook energy access methodology can be found at
www.iea.org/energyaccess/methodology.
4
Most improved cookstoves currently in use have not been found to significantly improve household air
pollution and thus are not considered as access to clean cooking. For our projections, only the most
improved biomass cookstoves that deliver significant improvements are considered as contributing to
energy access.
5
The IEA Electricity Access Database, based on administrative data reported by ministries, differs from the
World Bank Global Electrification Database, which derives estimates from household surveys. The IEA
administrative data on electrification provides information from the perspective of supply-side data on
utility connections and decentralised systems distributions, which in particular have the advantage of being
updated annually. More information on the differences between databases can be found in the Tracking
SDG 7 Report, which the IEA chaired in 2019, as one of the United Nations-appointed co-custodians of
SDG 7 (IEA, IRENA, UNSD, WB, WHO, 2019).
6
The World Bank’s Energy Sector Management Assistance Program is undertaking surveys in
several countries to measure energy access according to the "Multi-Tier Framework", a methodology that
measures multiple attributes of the supply and use of electricity and cooking fuels; this initiative is helpful to
map the current levels of access to affordable, reliable and modern energy, though assessment difficulties
are likely to remain on a large scale.

integrates comprehensive analyses on the reliability of power systems, the level of
energy demand from households, and the affordability of energy services, which are all
important in ensuring that access to modern energy services delivers social and 1
economic benefits (see section 1.3.3, and Chapters 2 and 3).
The Access to Clean Cooking Database comes from IEA analysis based on the Household
Energy Database 2018, collected by the World Health Organization, which compiles
data on reliance on primary cooking fuels at urban and rural level using national
surveys. This is complemented by IEA’s World Energy Balances, which contain data on
residential energy consumption, as well as government sources of data.
1.2.1 Clean cooking

Lack of access to clean cooking remains very acute in sub-Saharan Africa with access
increasing only slightly from 15% in 2015 to 17% in 2018 (Figure 1.7). Progress has been
registered in a handful of countries: West Africa has made the fastest progress since 2010,
with almost 3 million people gaining access each year, followed by East Africa with nearly
1.5 million people per year. The number of people without access exceeded 900 million in
2018 as population growth outpaced efforts to provide access. Sub-Saharan Africa is the
only region where the number of those without access continues to rise significantly,
highlighting the urgent need for action. Almost 500 000 premature deaths per year are
related to household air pollution from the lack of access to clean cooking facilities, with
women and children the worst affected. Lack of access to clean fuels is also one of the most
significant contributors in low-income countries to women’s workloads, and poses a barrier
to the economic advancement of women. It leads to women collecting and carrying loads
of wood that weigh as much as 25-50 kilogrammes, which can also damage their health
(UNEP, 2017).
Forest degradation, sometimes leading to deforestation, is another serious consequence of

the unsustainable harvesting of fuelwood, mainly driven by inefficient charcoal production
for cities (see Chapter 2). The forest area per capita in the sub-Saharan African region, a
rough proxy for biomass potential available for consumption, is declining at an annual
average rate of about 3%, almost double the rate seen in other developing regions.
Biomass consumption outstrips the sustainable potential by the largest margin in Nigeria
and Kenya. It is estimated that 27-34% of wood-fuel harvesting in tropical regions is
unsustainable (FAO, 2018). Deforestation and the resultant shortage of fuel affect millions
of people, especially women and children, who bear most of the responsibility for gathering
firewood and cooking.
The shares of cooking fuels in sub-Saharan Africa (excluding South Africa) have remained
relatively stable in recent years (Figure 1.8). Solid biomass – including fuelwood, charcoal
and dung – is the most widely used fuel across the region (Box 1.3). Several governments,
including Ghana, Cameroon and Kenya, are promoting LPG as a better alternative, largely in

Figure 1.7 ⊳ Population without access to clean cooking in Africa, 2018
Around 900 million people are without access to clean cooking in Africa;
in 32 countries more than 75% of the population is without access to clean cooking
This map is without prejudice to the status of or sovereignty over any territory, to the delimitation of
international frontiers and boundaries and to the name of any territory, city or area.
Sources: IEA analysis; World Health Organization (WHO) Household Energy Database.
urban areas. Ghana has been promoting LPG since 1989 and 24% of the population relied
on LPG in 2018; as of December 2017, the government had distributed LPG cookstoves to
150 000 households in 108 districts under the LPG Promotion Programme launched in
2017. It intends to distribute them in all 217 districts of Ghana by 2020 (Asante, et al.,
2018). In other countries, for example Nigeria, LPG uptake primarily displaces kerosene.
Clean cooking has only increased by 0.7 percentage point since 2013 in rural sub-Saharan
Africa, in part because supply chains for cleaner fuels lack the necessary scale to reach
many rural communities.

Figure 1.8 ⊳ Main fuels used by households for cooking, 2018
Urban Rural
Tanzania
1
Fuelwood, straw
Senegal and other waste
Charcoal
Nigeria
Mozambique Coal
Kenya
Kerosene
Ghana
Ethiopia LPG and
DR Congo natural gas
Electricity
Côte d'Ivoire
and other
Angola
50% 100% 50% 100%

Use of clean cooking fuels such as LPG continues to increase in urban areas,
but reliance on traditional use of biomass still dominates in rural areas
Sources: IEA analysis; WHO Household Energy Database.
Box 1.3 ⊳ Traditional and modern uses of biomass
The various forms of bioenergy differ in terms of sustainability. Bioenergy feedstocks

include different products and by-products from the agriculture, forestry and waste
sectors (e.g. wood, charcoal, sugarcane, palm oil, animal waste) and there are many
ways to use them to produce energy (heat, electricity and fuels).
In Africa, as well as developing Asia, solid biomass remains the largest source of energy
used by households (in energy-equivalent terms) and is often burned as fuel in a
traditional manner in inefficient and polluting cookstoves, using very basic technologies
often with no chimney or one that operates poorly. This so-called “traditional use” of
solid biomass is not sustainable and is associated with a range of damaging impacts to
health and well-being. The volumes concerned are generally excluded when presenting
shares of energy from renewable sources.
Solid biomass can also be used for cooking and heating in more advanced, efficient and
less polluting stoves. It can likewise be used as a fuel in combined heat and power
plants or transformed into processed solid biomass (pellets), liquid biofuels or biogas.
These are classified as modern uses of bioenergy.
Bioenergy has the potential to contribute to the decarbonisation of the power, heat
and transport sectors, bringing wider benefits in terms of rural development and
diversification of energy supply. There are a number of potential concerns regarding

sustainability that have to be considered when planning to use biomass, however,
including deforestation, loss of biodiversity, lifecycle greenhouse-gas (GHG) emissions,
land-use changes and air pollution linked to combustion. It is thus important that the
potential benefits of using bioenergy are balanced against the sustainability
considerations that are unique to each bioenergy supply chain application (see
Chapter 2).
Several programmes support the diffusion of improved biomass cookstoves. Nonetheless,

extensive analysis conducted by the IEA for Energy Access Outlook 2017, in collaboration
with the International Institute for Applied Systems Analysis, showed that such
programmes had limited success (IEA, 2017a). Improvements in pollutant levels from
improved biomass cookstoves were often overstated, with virtually no biomass cookstoves
on the market meeting WHO standards for exposure to household air pollution.
Conversely, while their reach has been limited to date, alternative biomass-based cooking
fuels (such as bioethanol, biomass pellets, briquettes and biogas) are increasingly
considered as viable alternatives to the unsustainable use of biomass. Where infrastructure
and production can be efficiently developed, bioethanol in particular could prove to be not
only safer but also cheaper than charcoal or kerosene. KOKO Networks, a company that
focuses on promoting liquid bioethanol as a clean cooking fuel, recently launched
700 distribution points across Nairobi following a successful pilot project. Government
support however will be essential to support production and distribution in many areas,
especially in rural areas. In Ethiopia, for example, following initiatives such as Project Gaia,
the government developed a National Biofuels Policy; promoting ethanol both for stoves
and for blending with gasoline as a transport fuel, and production of ethanol now stands at
around 40 million litres per year.
Very efficient electric cooking solutions are meanwhile increasing the attractiveness of
electric cooking options (Couture and Jacobs, 2019). Increasing the efficiency of electric
cooking could help merge initiatives on access to electricity and clean cooking by facilitating
the integration of very efficient cooking appliances such as pressure- and slow-cookers in
decentralised electric systems.
While clean cooking fuels and technologies are now more available, consumer awareness,
accessibility and affordability remain significant challenges. The provision of clean cooking
solutions does not guarantee that rural and urban communities will stop using traditional
cooking methods. In Kenya, while only 26% of households said that charcoal was their
primary cooking fuel, almost 70% were using it some of the time (Dalberg, 2018); and in an
experiment testing several improved biomass cookstoves solutions some rural Kenyan
households said that, although many of the proposed cookstoves allowed faster and more
efficient cooking, they were much less flexible and adapted to their needs than traditional
three-stone fireplaces (Pilishvili et al., 2016). Many poor and rural recipients of clean
cookstove programmes thus continue to use traditional fuels and solutions for

socio-cultural, economic and pragmatic reasons. Programmes to replace traditional but
unsustainable fuel use are likely to succeed only if they are able to take account of these
barriers to adoption in their design.
1
1.2.2 Electricity
More than two-thirds of people without access to electricity in the world today live in
sub-Saharan Africa. North Africa reached almost universal access to electricity by 2018, but
the electrification rate in sub-Saharan Africa was 45% in that year. Electrification levels in
sub-Saharan Africa remain very low compared to the levels in other developing parts of the
world, most notably the 94% rate reached on average across developing countries in Asia.
Lack of electricity often obliges households, small businesses and community services that
can afford it to use inefficient, polluting and expensive alternative solutions for essential
services.
Despite the comparatively low access rate, sub-Saharan Africa has made progress with the
pace of electrification accelerating over the past five years. The number of people gaining
access to electricity for the first time more than doubled from 9 million a year between
2000 and 2013 to more than 20 million a year between 2014 and 2018, outpacing
population growth for the first time. As a result, the number of people without access to
electricity in sub-Saharan Africa peaked at 610 million in 2013, before slowly declining to
around 595 million in 2018 (Figure 1.9). The region now faces a dual challenge: how to
provide access to the 600 million currently deprived while at the same time reaching the
millions born every year in areas without access to electricity.
Figure 1.9 ⊳ Electricity access by country in sub-Saharan Africa, 2000-2018
1 200
Million people
Total population
1 000
800 With access
600 Without access:

Other sub-Saharan
400 Africa
Uganda
Tanzania
200 Ethiopia
DR Congo
Nigeria
2000 2005 2010 2015 2018
Population without electricity access has plateaued since 2013 thanks to the
acceleration of connections; almost 50% of those without access live in five countries

About half of the sub-Saharan African population without access to electricity live in five
countries: Nigeria, DR Congo, Ethiopia, Tanzania and Uganda (Figure 1.10). Conversely,
Ethiopia, Tanzania and Kenya connected the highest number of people between 2014 and
2018, with these three countries accounting for more than 50% of those gaining access.
Figure 1.10 ⊳ Population without access to electricity by country in Africa, 2018
In sub-Saharan Africa 55% of people lack access to electricity; in thirteen countries,

more than three-quarters of the population do not have access to electricity
The energy challenges facing households vary significantly across Africa. In urban areas, on
average, almost three-quarters of households have access to electricity, whereas in rural
areas this figure falls to one-quarter. In remote rural areas and small cities not connected
to a grid, finding affordable off-grid solutions and business models is key. But there are also
many people living in informal settlements, with grid infrastructure nearby, that are not
connected at all, or are connected illegally to the distribution grid, resulting in a revenue

loss for utilities as well as exposure to hazards such as fires and risk of electrocution for
those with illegal connections (see Spotlight on communities that live “under-the-grid” but
without electricity). Getting or formalising grid access is often complicated not only by the
1
high upfront connection costs for poor households, but also by the quality or absence of
local distribution infrastructure. For households already connected, located mainly in urban
areas, strengthening the reliability of supply from the grid and the affordability of electricity
remains the priority (see section 1.3.3).
East Africa stands out as a beacon of progress. It has more than quadrupled the increase in
its electrification rate, going from an increase of around one percentage point per year
between 2000 and 2013 to more than four percentage points per year from 2014 to 2018.
It contains three strong performing countries in terms of electricity access rate progression:
Kenya, Rwanda and Ethiopia (Figure 1.11). Kenya has performed best in recent years, with
its access rate going from 25% in 2013 to 75% in 2018. Progress in Kenya is attributable to a
combination of factors: a strong grid connection push through the Last Mile Connectivity
Project; continuous support by government for decentralised systems expressed through
exemption from import and value-added taxes for solar products and the adoption of
international standards; and the development of a mature mobile payment infrastructure
that enabled innovative business models and payment mechanisms to emerge. These
factors allowed the country to increase grid connections by almost one million households
per year (or more than five million people), and to provide more than 700 000 households
with access to electricity through decentralised systems by 2018.
Figure 1.11 ⊳ Electricity access progress in sub-Saharan Africa
Electricity access rate by region Progress in key countries, 2013-2018

60% 60 30
Million people
West Africa
Percentage
40 20
40%
20 10
Southern Africa
20%
Central Africa
Kenya
Rwanda
Congo
Togo
Angola
Ghana
Ethiopia
Namibia
East Africa
Progression of electricity access rate
2000 2010 2018 Population gaining access (right axis)
Progress on electricity access has accelerated dramatically in East Africa since 2013
Progress has been much slower in Central Africa, but there are brighter signs in both West
and Southern Africa, which achieved 53% and 48% access rates respectively in 2018. Early
progress in Ghana demonstrated the need for an integrated approach that takes into

account all possible solutions to achieve universal access. In 1991, the Ghanaian
government developed the National Electrification Scheme, a master plan containing six
five-year implementation phases to reach universal access to electricity by 2030 which was
drawn up after a two-year National Electrification Planning Study. This scheme supported
the use of main grid, mini-grid and renewables stand-alone systems according to which was
most appropriate for a given area. Under its Self-Help Electrification Scheme, clearly stated
contributions or commitments were expected from both the government and communities
seeking to get connected to grid electricity. By 2018, 84% of the population had access to
electricity, up from 45% in 2000.
Lessons from other countries confirm the need for strong government leadership; for
adequate planning based on precise analyses of the situation; and for clear allocation of
responsibilities at the national and local levels in order to be able to achieve steady and
effective progress. In Morocco, for example, the national utility (ONEE) increased the rural
electrification rate from 18% in 1995 to 97% in 2009. It implemented a utility-led model
that focused on grid extension for 95% of households and that used solar home systems to
provide access to electricity for those in isolated or dispersed areas on the basis of a fee-
for-service model. In India, a strong push from the government resulted in almost
100 million persons gaining access to electricity in 2018. The Saubhagya Scheme, which ran
from October 2017 to March 2019, connected 26 million households to electricity for free;
almost 99% of these connections were realised through the main grid, while mini-grids and
solar home systems helped reach the remaining 1%, usually in remote areas.
While Morocco and India have provided access to electricity primarily through grid
connections, the geography, demography and level of infrastructure provision in
sub-Saharan Africa points towards the need for strategies specific to each country that
integrate centralised and decentralised solutions to reach universal access. As such,
governments in sub-Saharan Africa are increasingly allowing for flexibility in their policy
design. In Nigeria, the energy ministry has developed a set of policies that cover a wide
range of renewable systems as part of their efforts to reach remote populations across the
country. The Rural Electrification Agency is currently implementing a large-scale strategy
including energy service company-led and utility-led models to accelerate the rate of
electrification through grid extension and green mini-grids, and is targeting market clusters,
manufacturing centres, schools, universities and hospitals, for electrification using solar PV
and hybrid solar PV-diesel systems.
The majority of progress over the past decade has been made as a result of grid
connections7, but the balance has been shifting. Provision of access by means of
decentralised solutions has increased considerably since the IEA’s Energy Access Outlook
was published in 2017 (IEA, 2017a). Around 15 million people are now connected to mini-
grids in Africa (ESMAP, 2019), while the number of people gaining access through solar
7
Connections to the grid have been both formal and informal: in Côte d’Ivoire and Ghana, for example, one
single formal metered connection can legally serve more than one household.

home systems in sub-Saharan Africa increased from two million in 2016 (IEA, 2017a) to
almost five million in 2018 (IEA analysis based on sales data provided by the Global Off-grid
Lighting Association). This route to energy access has been concentrated in a few countries:
1
Kenya, Tanzania and Ethiopia accounted for almost 50% of new connections in 2018. In
Ethiopia, 32% of rural households are connected through solar home systems (Padam et al.,
2018) and in Rwanda around 15%. The market for solar home systems is largely made up of
systems below 50 watts which provide access to energy services such as energy-efficient
televisions and cooling fans.
The digitalisation of communication and financial services has been critical to the
development of mini-grids and solar home systems markets. In some countries in
sub-Saharan Africa, the widespread availability of mobile phones, mobile money accounts,
and associated telecommunication and payment infrastructures have helped the
development of a wide array of energy services (IEA, 2017b). Solar home system providers
are offering customers affordable payment plans over several months or years, often with
an initial deposit followed by daily payments that cost less than customers currently spend
on kerosene (see Chapter 3). Mobile networks enable direct communication with
customers and remote control of devices, enabling solar home systems to be disabled
when the customer fails to pay. By means of such a scheme, the company Fenix
International Inc. has brought affordable solar power to over 500 000 homes in several
regions of sub-Saharan Africa with its ReadyPaySolar Systems (Fenix, 2019).
The relationship between electricity access and priorities such as local development and
human capital is an important element of the United Nation’s 2030 Agenda for Sustainable
Development. The vast majority of rural households in Africa rely on agriculture, and
integrating agricultural needs such as irrigation, agro-processing and storage into the
design of electricity access business models and technologies can have a very positive
impact. Cold storage powered by renewable energy supply, for example, could help reduce
post-harvest losses, which are estimated at between 20% and 50% of food produced
(depending on the food) in sub-Saharan Africa. Electricity can also play an important role in
improving agricultural productivity through irrigation, as several successful examples of
stand-alone solar water pumps show, provided that policy makers also tackle wasteful
irrigation practices.
The absence of electricity access, or access only to intermittent supply, also deeply impacts
the quality of services available to the population. In 2016 in sub-Saharan Africa, around
half of lower secondary schools and 57% of upper secondary schools had no access to
electricity (UNICEF Institute for Statistics, 2019). Moreover, in 27 sub-Saharan African
countries, close to 60% of health centre facilities have no access to reliable electricity
(Cronk and Bartram, 2018). Access to electricity is essential to a proper provision of
essential services: in health centres, for instance, it supports the use of efficient modern
equipment, the preservation of vaccines and medicines, and the ability conduct emergency
medical procedures, for instance during childbirth.

S P O T L I G H T
What approaches can help communities that live
“under-the-grid” but without electricity?
More than half of the urban population in African countries lives in informal
settlements often lacking access to formal electrification services (Tusting et al., 2019).
Furthermore, at least 110 million of Africa’s 600 million people without electricity
access live in informal urban settlements close to or directly under a grid (GTM
Research, 2017). A 2017 World Bank study on infrastructure in Africa discovered that
connection rates for populations living under-the-grid is lower than 50% in most
countries in sub-Saharan Africa, with a few exceptions such as South Africa, Nigeria,
Gabon and Cameroon. Depending on the data source, estimates for under-the-grid
populations without access to legal electricity in other African countries range from
61% to 78% (World Bank, 2017a).
A few studies provide insights into the consumption of poor urban customers and the
reasons why utilities are unwilling or unable to serve them despite the immense
commercial opportunity they represent (Baruah B. , Energy Services for the Urban Poor:
NGO Participation in Slum Electrification in India, 2010). The price of grid connection is
one of the major barriers to connection. Typically, people who live in urban informal
settlements are poor, with low incomes and low power demands, and connection
prices are frequently unaffordable. Before the Last Mile Connectivity Project, the price
of a connection in Kenya was around $400 per household (Lee, Miguel and Wolfram,
2016), nearly one-third the annual average per capita income and over three-times the
mean of the willingness to pay of surveyed Kenyans. In Nigeria, 62% of under-the-grid
households cite high connection costs as the major reason for not being connected to
the grid (GTM, 2017). The Centre for Global Development estimates that there may be
up to 95 million people living in under-the-grid areas in Nigeria, Kenya, Tanzania, Ghana
and Liberia.
There is an urgent need for innovative approaches to provide affordable legal electricity
to those living under-the-grid in African countries. A look at promising practices for
providing legal access to electricity to urban poor consumers offers some guidance
(Shrivastava, 2017). In 2009, Tata Power Delhi Distribution Limited (TPDDL) in India
focused on connecting a particular segment of its customer base living in impoverished
neighbourhoods. The most significant interventions introduced by TPDDL included
reducing new connection charges to INR 350 (about $7 at the time), offering an
affordable 24-month payment plan, waiving outstanding dues, reducing requirements
for proof of identification and residency, relaxing commercial formalities on land rights
and promoting insurance offerings for those with metered connections. Between
2010 and 2015, TPDDL’s unique model connected 175 000 new rate-paying customers
in 217 impoverished neighbourhoods near New Delhi. In the process, the utility
doubled its customer base and increased its revenues fourfold.

Many of the features TPDDL adopted were replicated in Jamaica, Brazil, South Africa,
Philippines and Kenya (in Kenya it was estimated in 2013 that more than three-quarters
of off-grid homes are located within 1.2 kilometres of a power line) (Wolfram, 2013). In 1
2015, Kenya Power & Lighting Co. (KPLC) discovered through a survey that customer
willingness to pay for an electricity connection upfront was only 57%. KPLC responded
by instituting a subsidised connection fee of around $170 through the Last Mile
Connectivity Project and an instalment-based payment plan that led to a thirty-fold
increase in legal electricity connections in impoverished neighbourhoods in one year.
1.2.3 Affordability: energy prices and fossil fuel subsidies

Affordability remains a challenge when it comes to providing households with access and
with modern energy services that they can use. The two central elements here are the cost
of being connected and equipped (connection to the grid, acquisition of the decentralised
system or the stove, appliances); and the cost of the energy used (i.e. electricity supply and
cooking fuel refills). Making access to electricity and clean cooking affordable requires an
understanding of the current payments made by households for similar services and of the
structure of their income. For example, many households in rural areas relying on
traditional use of solid biomass use a stove and a fuel which do not require significant
capital outlay. As noted above, programmes which have proved to work on a large scale
have had to respond to household concerns about capital costs either by subsidising the
costs or by spreading payments over time to reduce the required capital outlay.
On the basis of electricity prices in several countries, it appears that paying for electricity to
power a few basic appliances (four lightbulbs, a fan, a mobile phone charger and a
television) would represent around 10% of the average income of the bottom 40% poorest
households (Figure 1.12), while in Mozambique and Togo it would represent more than
15%. As a result of the high cost of power relative to income, electricity consumption rates
per household in many sub-Saharan African countries are among the lowest in the world.
The average household in most sub-Saharan Africa consumes less than 1 000 kilowatt-
hours (kWh) of electricity each year, less than one-seventh of the average consumption of
households in advanced economies. Other than South Africa, it is only in Angola that
average household consumption exceeds 2 500 kWh, partly because the government
subsidises tariffs.
There are actions that governments can take to improve affordability. Cross-subsidy
schemes could help lower the costs of electricity for the poorest households. So could the
promotion of highly efficient appliances. While such appliances tend to have higher upfront
costs, we estimate that they could cut the proportion of income spent on electricity bills.
Incentives could be provided to poorer households to encourage the purchase of more
efficient appliances instead of or in conjunction with subsidies or cross-subsidies to reduce
the price of their electricity. Digital payments could facilitate such schemes: around 90% of
the 147 000 televisions sold by in the second-half of 2018 sold by solar home systems
companies were through pay-as-you-go mechanisms, with more than 100 000 sold in East
Africa (GOGLA, 2019).

Figure 1.12 ⊳ Electricity expenses required to power basic appliances as a
percentage of household revenues for the poorest 40%
20%
10%
Angola
Indonesia
Tanzania
South Africa
Togo
Nigeria
Kenya
Senegal
Mozambique
DR Congo
South Sudan
Ghana
Zimbabwe
Côte d'Ivoire
Eritrea
India
Philippines
Standard appliances Efficient appliances
Affordability of electricity remains an issue for many people in African countries.

Efficient appliances can help keep costs down
Notes: Electricity consumption is based on a basic bundle of energy services, equating to around 500 kWh
per household annually with standard appliances and 100 kWh with highly efficient appliances. This delivers
four lightbulbs operating four hours per day, a mobile phone charger, a fan operating three hours per day
and a television operating two hours per day. The household revenue is the average gross national income
per household for the bottom 40% of households and is computed using the World Development Indicators.
Sources: IEA analysis using World Bank World Development Indicators in some cases.
End-user energy prices vary significantly across countries in Africa, and reflect differences in
domestic energy resources, levels of energy access, subsidies and taxes. Retail prices for
road transport (gasoline and diesel), for example, are often higher than the world average
(Figure 1.13) There are however exceptions: some major hydrocarbon exporting countries
supply fuels to their domestic markets at prices lower than those in international markets.
Some countries abstain from energy consumption subsidies in order to focus on other
policy priorities. Instead of supporting gasoline and diesel prices, for example, Ghana
prioritises subsidising kerosene and LPG as part of a strategy to promote switching away
from the harmful and unsustainable use of solid biomass.
The interaction of subsidy policies with energy access is a challenge for many sub-Saharan
African countries, raising questions about fiscal priorities and about how best to improve
access to electricity and achieve sustainable development goals. Consumption subsidies for
fossil fuels may once have seemed necessary for development goals, but renewables are
increasingly cost competitive with other forms of generation, and many countries are now
looking instead at an expansion of low-carbon electricity provision, both via centralised
grids and on a decentralised basis (which avoid the costs of transmission and associated
losses as well as incurring lower costs for distribution). The situation is different for clean
cooking, where some of the viable alternatives to solid biomass are fossil fuels, in particular

LPG, but examples in India and in some African countries show how subsidies can quite
effectively be targeted at specific sectors of the population, or limited to a certain number
of LPG cylinders per month.
1
Figure 1.13 ⊳ Gasoline end-user prices in selected African countries, 2018
Global average Gasoline price

Tanzania
South Africa Subsidy
Ghana
Kenya
Mozambique
Gabon
Algeria
Egypt
Angola
Nigeria
Libya
0.3 0.6 0.9 1.2
Dollars per litre (2018)
Gasoline end-user prices vary substantially in African countries
For oil-exporting countries in Africa, many of which subsidise fossil fuel consumption, lower
prices since 2014 have created strong pressure for pricing reforms to improve fiscal
balances and to diversify economies which are highly dependent on hydrocarbons.
However, the reform process remains unfinished business in a number of countries.
Despite being a net exporter of oil, Nigeria imports most of the oil products consumed in
the country (see section 1.3.3) and continues to supply them at subsidised prices; we
estimated the value of these subsidies in 2018 at $2.9 billion section. Fossil fuel
consumption subsidies are much more prevalent in North Africa, in particular in Egypt (with
an estimated consumption subsidy bill of $27 billion in 2018), Algeria ($17 billion) and Libya
($5 billion).
1.3 Energy trends in Africa today

1.3.1 Energy demand
Primary energy demand
In recent decades, African energy demand has been driven by the growing needs of North
Africa, Nigeria and South Africa. In 2018, primary energy demand in Africa was more than
830 million tonnes of oil equivalent (Mtoe): North Africa (24%), Nigeria (19%), and South
Africa (16%) together accounted for almost 60% of this despite making up only 35% of the
population. Average energy consumption per person in most African countries is well
below the world average of around 2 tonnes of oil equivalent (toe) per capita and is broadly
comparable to India’s average of 0.7 toe/capita. In 2018, per capita consumption in

sub-Saharan Africa was highest in South Africa at 2.3 toe/capita and in Nigeria at
0.8 toe/capita (Figure 1.14). Most other sub-Saharan African countries have per capita
consumption of around 0.4 toe/capita and in most a large part of it consists of the relatively
inefficient use of solid biomass.
Figure 1.14 ⊳ Energy consumption per capita and population in selected

sub-Saharan African countries, 2018
2.5
Energy consumption (toe/capita)
2.0
1.5
South Africa
Mozambique
Côte d'Ivoire
DR Congo
Tanzania
1.0
Senegal
Angola
Ghana
0.5
Kenya
Nigeria
Ethiopia Other sub-Saharan Africa
0 200 400 600 800 1 000

Million people
Excluding South Africa, per capita consumption in sub-Saharan Africa

is 65% below the average for developing economies
Figure 1.15 ⊳ Primary energy demand and GDP annual growth in

selected sub-Saharan African countries, 2010-2018
10% TPED
8% GDP
6%
4%
2%
Angola
Tanzania
South Africa
Nigeria
Kenya
Senegal
Ethiopia
Mozambique
DR Congo
Ghana
Côte d'Ivoire
There is wide disparity between annual GDP growth and

primary energy demand in many sub-Saharan African countries
Note: TPED = total primary energy demand.

The rate of growth in energy demand in sub-Saharan Africa has slightly slowed in recent
years and remains lower compared to GDP growth (Figure 1.15). Between 2000 and 2010,
energy demand increased at an annual average rate of 3%, but this slowed to 2.5% from
1
2010 to 2018, with very marked variations. Countries such as the DR Congo (Africa’s fourth
most populous country) saw their primary energy demand more than double between
2000 and 2018, whereas others such as Côte d’Ivoire, Ghana and Mozambique have
witnessed an increase in demand of around half. The smaller increase in demand does not
mean energy services didn’t grow at the same rate: in the case of Côte d’Ivoire, the push
towards LPG for cooking has resulted in a decline in solid biomass use, and this has
produced large efficiency gains.
Traditional biomass is used mostly for cooking in Africa, but is also used in industry. It is by
far the most widely used energy source across Africa, with the exception of North Africa,
where oil and gas dominate, and South Africa, where the energy mix is coal-heavy
(Figure 1.16). In sub-Saharan Africa, bioenergy’s share in the overall energy mix has barely
changed over the last 25 years, and it continues to dominate the primary energy mix,
accounting for 60% of total energy use in the region (if South Africa is excluded, this share
increases to almost three-quarters). There is no other region in the world that relies so
heavily on bioenergy.
Figure 1.16 ⊳ Total primary energy demand by fuel for selected

African regions, 2018
Coal
North Africa Oil
Gas
Nuclear
Hydro
South Africa
Bioenergy
Other renewables
Other sub-
Saharan
Africa
100 200 300 400 500

Mtoe
With the exception of South Africa, the sub-Saharan Africa
energy mix is dominated by solid biomass and oil
Fossil fuels represent almost 40% of the overall energy mix in sub-Saharan Africa and more
than half of the African energy mix. Oil demand stands at almost four million barrels per
day (mb/d). The transport sector accounts for most oil use (60%), but diesel is also
consumed for back-up generators, kerosene or LPG within households for lighting and
cooking, and a variety of oil products are used by industry (Table 1.1). Natural gas overtook

coal as the third fuel in the African energy mix in 2015. Today, natural gas accounts for 16%
of that mix, with nearly 160 billion cubic metres (bcm) consumed each year: almost 80% of
this is consumed in North Africa and over 10% in Nigeria. Coal now accounts for 13% of the
primary energy mix (compared with around a quarter globally), with consumption of almost
160 Mtce. South Africa accounts for the overwhelming majority of the continent’s coal
consumption, where it is used for power generation, industrial processes, transport (after
coal-to-liquid conversion), and household heating.
Table 1.1 ⊳ Total final consumption by fuel and sector in sub-Saharan Africa,
2018 (Mtoe)
Industry Transport Residential Other
Coal 12 0 5 5
Oil 9 69 5 13
Gas 9 0 0 0
Electricity 17 0 10 7
Bioenergy 18 0 281 13
Other renewables - - 0 0
Total 65 69 301 38
Share of total final consumption 14% 15% 64% 8%
Households
The affordability of basic services is an important concern in many African countries, where
there are very low levels of appliance and vehicle ownership (Table 1.2). There are
important disparities between urban and rural areas, reflecting their different levels of
income (see section 1.2.3). There are also major inequalities within urban and peri-urban
areas, where many people live in informal settlements under poor conditions as measured
in terms of access to energy, sanitation and water services. While the situation has
improved slowly over the last ten years, many households still lack appliances that could
improve their quality of life, such as a fan (or even air conditioning) and a refrigerator:
ownership levels of these appliances are far below the average of developing countries.
In many parts of Africa, ownership of a car remains a luxury, while ownership of two/three-
wheelers is comparatively more common. The number of passenger light-duty vehicles is
increasing in many countries as incomes rise, but the efficiency of the fleet is low as many
are older vehicles imported second-hand from Europe and Asia (although some countries,
for example Angola and Mozambique, restrict the importation of older vehicles). Public
transport is also less developed in many places though it could play a pivotal role in
boosting economic and social welfare in one of the world’s most rapidly urbanising region.
Rail networks are scarce, and many were originally built to meet the needs of extractive
industries rather than to provide passenger services. In many parts of the continent,
households rely on buses and minibuses to travel within or between cities. Providing safer
and faster alternatives for transporting large numbers of people would be the first among
the many benefits of investing in mass transport. There are a number of success stories in
the region to inspire the further development of public transport (Box 1.4).

Table 1.2 ⊳ Household size and average household ownership of key items
in rural and urban areas in Africa
Household
Air conditioner Car
Two/three- 1
occupancy wheeler
(ownership per (ownership per (ownership per
(number of people)
1 000 households) 1 000 households) 1 000 households)
Urban Rural Urban Rural Urban Rural Urban Rural
Sub-Saharan Africa 3.8 5.5 68 11 125 21 129 96
Angola 3.7 5.0 164 22 171 12 162 202
Côte d'Ivoire 4.0 5.6 25 10 64 8 161 220
DR Congo 4.3 5.9 9 8 43 1 79 38
Ethiopia 3.2 4.8 13 9 33 2 25 8
Ghana 3.1 4.1 119 33 126 44 91 132
Kenya 3.4 4.4 20 3 109 29 78 107
Mozambique 3.6 4.9 9 8 108 12 111 74
Nigeria 3.9 5.9 92 14 205 64 304 356
Senegal 6.4 11.3 19 9 25 14 112 104
Tanzania 3.8 5.5 16 9 59 14 115 111
South Africa 3.1 3.9 107 34 343 168 31 9
Other 4.1 6.0 62 8 42 1 77 37
North Africa 3.7 5.5 235 58 147 57 60 106
Box 1.4 ⊳ A transport success story: Bus Rapid Transit in Dar es Salaam
Dar es Salaam, Tanzania is growing at an unprecedented rate and is projected to

become a megacity by 2035.8 Most of the expansion has emerged on the edges of the
city, compelling many commuters to travel very long distances to work. After years of
struggling with an outdated and overcrowded transportation system that was
extremely time-consuming to use, the city has introduced a new bus rapid transit (BRT)
system which carries 200 000 passengers a day and has cut average travel times from
the city centre to the terminus from two hours to 45 minutes each way. Recognised by
the Institute for Transportation and Development (ITDP) as Africa’s only “gold
standard” BRT rating, this high-quality transit system of dedicated bus lanes offering
fast, comfortable and cost-effective services at metro-level capacities is a potential
model for other cities.
A similar initiative in Johannesburg in South Africa is called the Rea Vaya or “We are
going” bus system. It runs on low-sulfur diesel and operates on predetermined routes in
dedicated bus lanes, significantly cutting the time spent travelling through the
congested streets. The system is reported by the World Resources Institute to have
saved the country around $900 million so far by reducing travel time, improving road
safety and reducing carbon emissions.
8
A megacity is defined by the United Nations as a metropolitan area with a total population of more than
10 million people.

Households in Africa generally have a low level of energy consumption (Figure 1.17).
Nonetheless, their overall energy use (including passenger transport needs) accounts for
around two-thirds of final energy consumption. The share of households in final
consumption is even higher in sub-Saharan Africa, where it reaches more than 70%, largely
because of the extent of their reliance on inefficient solid biomass for cooking and poor
quality cookstoves.
Figure 1.17 ⊳ Urban and rural household energy consumption per capita
and by fuel for selected African countries, 2018
DR Congo Ghana Nigeria Tanzania

1.0 50%
toe /capita
0.8 40%
0.6 30%
0.4 20%
0.2 10%
Urban Rural Urban Rural Urban Rural Urban Rural

Fossil fuels Bioenergy Electricity Other Share of transport (right axis)
Average household energy consumption varies between urban and rural and across
countries, as does the fuel mix, though generally with a high share of bioenergy
Productive uses
Productive uses, including industry, agriculture and services, account for around a quarter
of total final consumption of energy in Africa. Industry employs only 13% of the workforce
and generates only a third of GDP but it uses almost 70% of the energy that goes into
productive uses. The services sector uses only limited amounts of energy even though it
generates half of GDP. Agriculture employs half of the African workforce, but accounts for
only 16% of GDP and less than 10% of energy for productive uses.
Agricultural productivity per hectare in sub-Saharan Africa is well below that of other
regions in the world: this reflects low energy inputs, but also a lack of modernisation,
limited use of irrigation to raise crops yields and unpredictable weather (IEA, 2017a). As a
result, food production per capita has not changed significantly since 2000.
The lack of transport infrastructure acts as a brake on the development of the African
economy. It hinders the development of trade within the continent as well as export (and
import) of finished goods. Tackling this would help Africa to take advantage of
opportunities arising from the new African Continental Free Trade Agreement (AfCFTA),

which entered into force in May 2019. With the right enabling conditions, the AfCFTA has
the potential to have a significant impact on the continent’s development. The United
Nations Economic Commission for Africa UNECA has predicted that by 2040 it will raise
1
intra-African trade by 15-25%, or from $50 billion to $70 billion, compared to an Africa
without the AfCFTA (UNECA, 2018a).
Figure 1.18 ⊳ Per capita consumption of key materials, 2017

Steel Cement Plastics
Advanced
economies
Developing
economies
Africa
Ghana
Kenya
Nigeria
200 400 400 800 40 80

kg per capita
Demand met via Domestic production Imports
Per capita consumption of key materials such as cement, plastics and steel
in Africa is low compared to developing economies elsewhere
Notes: Plastics consumption is based on 2015 data and includes key thermoplastic resins; developing
economies elsewhere refers to Developing Economies less African economies in the group.
As things stand, sub-Saharan African countries represent a very small share of global
industrial production: they are responsible for around 2% of global cement and aluminium
production and less than 1% of steel production. As a result, Africa continues to rely on
imports of many energy-intensive materials and manufactured goods (Figure 1.18).
1.3.2 Power sector

Electricity demand
Despite being home to almost a fifth of the world’s population, Africa accounts for little
more than 3% of global electricity demand and North African countries (42%) and South
Africa (30%) represent nearly three-quarters of this. Africa’s electricity demand is growing,
but only at half the rate of developing Asian countries: it rose to 3% a year on average
between 2010 and 2018, increasing from 560 terawatt-hours (TWh) in 2010 to around
705 TWh. The latter figure is equivalent to a fifth of electricity demand in Europe in 2018.
Electricity accounts for around 10% of Africa’s total final energy consumption, but per
capita electricity demand in Africa remains very low at around 550 kWh (370 kWh in
sub-Saharan Africa) compared with 920 kWh in India and 2 300 kWh in Developing Asia.

Higher demand from the buildings sector accounted for almost 70% of the increase since
2010, largely, as a result of increased demand (more than 60 TWh) in residential buildings
from appliances, water heating and cooling. Demand in heavy industry was largely stagnant
over 2010-18 with lighter industries making up 90% of the almost 40 TWh demand increase
across industry. South Africa alone accounted for more than 40% of African electricity
demand from industry in 2018 although demand in the sector has been largely flat since
2010. Electricity use in transport remains very low across Africa, but is highest in South
Africa, where parts of the rail network are electrified.
Electricity supply from centralised grids

Electricity generation in Africa increased to 870 TWh in 2018 from 670 TWh in 2010.
Natural gas and coal (the latter largely in South Africa) accounted for 40% and 30% of
generation output in 2018 respectively. Hydropower accounted for a further 16% and oil
for 9%. However, there are large regional differences. In North Africa, for example, natural
gas contributed more than three-quarters to power generation in 2018. South Africa in
contrast is hugely reliant on coal and to a modest extent on nuclear power while in the
remainder of sub-Saharan Africa, hydropower provides over half of generation output with
oil and gas accounting for most of the balance. Although non-hydro renewables in
sub-Saharan Africa (excluding South Africa) increased by 250% over the 2010-18 period,
accounting for slightly more than 7% of all renewables and 4% of total generation output
(Figure 1.19) in 2018.
Figure 1.19 ⊳ Electricity generation by fuel in Africa, 2010-2018 (left)

and in key regions in 2018 (right)
1 000 400 TWh

TWh
800
300
600
200
400
100
200
2010 2012 2014 2016 2018 North Sub-Saharan South

Africa Africa* Africa
Coal Oil Gas Nuclear Hydropower Solar PV Wind Other renewables
Natural gas fuelled most of the increase in electricity supply for the continent on the whole,
but fuel shares varied by region and coal dominated in South Africa
* Excluding South Africa.

Figure 1.20 ⊳ Installed power capacity by fuel in selected regions/countries
2010
1
Africa
2018
2010
South Saharan North
Africa Africa* Africa
2018
2010
Sub-
2018
2010
2018
50 100 150 200 250 GW

Nigeria Angola Ghana Ethiopia bique Congo d'Ivoire Tanzania Kenya Senegal
2010
2018
2010
2018
2010
2018
2010
Côte
2018
2010
Mozam- DR
2018
2010
2018
2010
2018
2010
2018
2010
2018
2010
2018
4 8 12 16 20 GW
Coal Gas Oil Nuclear Hydro Other renewables

Fossil fuels dominate the power mix but the role of non-hydro renewables is increasing
* Excluding South Africa.

Between 2010 and 2018, total installed generation capacity in Africa increased from around
155 gigawatts (GW) to almost 245 GW, or about a quarter of the capacity in European
Union countries. South Africa and North African countries account for around 165 GW of
this installed capacity. The capacity mix by fuel varies across the continent by country and
region. North Africa accounts for almost 85 GW of Africa’s 100 GW of gas-fired power
plants, while the remainder is concentrated in Nigeria, Ghana, Côte d'Ivoire, Tanzania and
Mozambique. South Africa accounts for 85% of the almost 50 GW of coal-fired capacity on
the continent. Oil-fired capacity totals just over 40 GW; its relative importance varies
greatly by country.
Renewable power capacity increased from 28 GW in 2010 to almost 50 GW in 2018.

Hydropower is the largest source of renewable power by far and its capacity increased
from 26 GW in 2010 to 35 GW in 2018, although its share in the overall generation mix has
remained relatively constant at around 15%. Other renewable sources have started to
develop but, for the moment, their share in generation and capacity is low. Although it has
expanded in recent years, wind power development in Africa has been limited in scale
compared to hydro with close to 5.5 GW of installed capacity in 2018, up from almost 1 GW
in 2010. North Africa accounts for around 2.6 GW of this capacity and South Africa for
around 2 GW. The growth of wind power in South Africa is in part a result of its Renewable
Energy Independent Power Producer Procurement Programme that was launched in 2011
and has delivered close to 3 GW of new capacity over the past five years: notable projects
include the Loeiresfotein and Khobab Wind Farms (140 megawatts each) which were
commissioned in 2017. Countries such as Ethiopia, Ghana, Tunisia, Kenya and Morocco are
making efforts to increase their wind deployment by adopting the independent power
producers (IPPs) model (Greentech Media, 2019).
Solar PV installed capacity is around 4.5 GW. Capacity increased in 2019 when the 1.6 GW
Benban Solar project, the largest utility-scale solar PV project on the continent to date,
recently started service in Egypt. South Africa currently has close to 2 GW of installed solar
PV capacity and a number of concentrating solar power (CSP) projects including the
100 megawatt (MW) Xina Solar One project and the 100 MW IIanga-1 plant, which were
commissioned in 2017 and 2018 respectively (IEA, 2018b). These projects brought the
country’s total installed CSP capacity to 0.4 GW, close to 40% of Africa’s installed capacity
of CSP.
Geothermal resources are generally concentrated in the eastern part of Africa where
tectonic regimes indicate potential equivalent to more than 15 GW (Geothermal Energy
Association, 2019). With excellent geothermal resources, Kenya has installed more than
600 MW of capacity: plans are underway to develop an additional 1 000 MW from three
geothermal projects (Geothermal Development Company, 2019). Other countries in East
Africa, including Ethiopia, Djibouti, Eritrea, Tanzania and Uganda are also looking to tap
their geothermal resources.

Electricity trade
Africa is home to five regional power pools: Eastern Africa Power Pool (EAPP); Central
African Power Pool (CAPP); Southern African Power Pool (SAPP); West African Power Pool 1
(WAPP); and Maghreb Electricity Committee (COMELEC) (Comité Maghrébin de l’Electricité)
(Figure 1.21). These pools vary greatly in terms of scale, governance and effectiveness.
Figure 1.21 ⊳ Electricity trade between power pools in sub-Saharan Africa,

2018
Regional power pools help to connect power generation sources across Africa
Sources: World Bank (2017b) and AfDB’s Africa Energy Portal (AfDB, 2018).

The SAPP has 17 members from 12 countries and operates four competitive electricity
markets. Annual power trade amounts to around 3% of the member countries’ demand, of
which a growing portion is traded in the market. The COMELEC is relatively advanced while
the WAPP and EAPP, both comparatively new, are making progress. The WAPP was
established in 1999 and currently has 29 members, utilities and IPPs but remains
underdeveloped compared with SAPP and COMELEC. The EAPP, established in 2005,
comprises 11 state-owned utilities in Eastern Africa. The WAPP and EAPP have been
working to harmonise their regulatory systems and develop market rules (e.g. standardised
contracts and regional wheeling tariff methodology). Various transmission interconnections
are under construction in EAPP, including an interconnection with SAPP (through a
400 kilovolt Tanzania-Zambia line). The CAPP was established in 2003 by utilities of eleven
central African countries and is the least advanced.
Figure 1.22 ⊳ Power traded bilaterally and through competitive markets in the
Southern African, West African and Eastern Africa power pools
8 000 40% Electricity traded

GWh
bilaterally
6 000 30% Electricity traded in

markets
20% Share of trade in

4 000
total electricity
demand (right axis)
2 000 10%
Southern African West African Eastern Africa

Power trade is low across the power pools and,
except for the Southern African Power Pool, only bilateral trade
Note: GWh = gigawatt-hours.
Trade across the region remains low and is mostly realised through bilateral contracts
(Figure 1.22). At present, in sub-Saharan Africa only SAPP has a functioning market. Some
countries remain isolated from regional grids. Even where transmission interconnections
exist, these are sometimes congested and need to be upgraded to facilitate trading. Around
1.8 TWh of electricity were matched in the competitive markets in SAPP in 2016/17, but
were not traded because of transmission constraints (Figure 1.23).9
9
Market players submit bids to buy and sell electricity in the wholesale market. When the power offered
coincides with that requested, or vice versa, the electricity is said to be ‘matched’. Yet, electricity can be
matched but not traded, as technical constraints can come into play, like lack of transmission capacity to
transport the matched electricity.

Figure 1.23 ⊳ Electricity matched and traded in Southern African Power Pool
and share of power traded in competitive markets, 2011-2018
3 000 60% Power matched, not

1
GWh
traded (transmission
2 500 50% constraints)
Power matched, not
2 000 40% traded (other reasons)
1 500 30% Total power traded
1 000 20%
Share of power traded
500 10% competitively in total
trade (right axis)
2011 2012 2013 2014 2015 2016 2017 2018

Power traded in the competitive market has increased,
though transmission constraints risk impeding further exchanges
Note: GWh = gigawatt-hours.

Source: SAPP annual reports (SAPP, 2019).
Most interconnections are state- or utility-owned and publicly funded. Transmission

interconnections are capital-intense investments that require strong co-ordination among
two or more governments and have high perceived risks, including risks related to
transmission pricing. This makes it difficult for them to attract private sector finance, while
domestic utilities are loss-making and have a low ability to raise funds themselves to
finance these assets. This results in low investment and substantial delays. For example, the
Zimbabwe-Zambia-Botswana-Namibia Interconnector (ZiZaBoNa) was initiated with the
signing of an inter-utility memorandum in 2007 but has yet to reach financial closure. The
situation looks set to improve with foreign donors such as the World Bank, the European
Union, the European Investment Bank and US Agency for International Development Power
Africa committed to providing financial and technical assistance for transmission
interconnection projects, including the Cameroon-Chad Electricity Interconnection Project
(PIRECT) and the 225 kilovolt (kV) interconnection of the electricity grids between Guinea
and Mali.
Regional power integration has the potential to reduce the level of infrastructure
investment needed to meet demand by opening up a wider range of sources of supply
(SAPP estimates savings in generation and transmission infrastructure of $37 billion over
the 2017-40 period). It would also help to improve the resilience of countries energy
systems by providing access to diverse and complementary markets, and help countries
take advantage of economies of scale and realise large, low-cost projects that would not be
justified based on domestic electricity demand alone. The potential benefits of the power
pools mean that it makes sense to continue efforts to reduce investment risks and increase

the bankability of projects, despite the challenges. This means improving transmission
infrastructure and finding the right business model to scale up cross-border investments.
Setting up a market in the EAPP and WAPP would allow countries to benefit from price
differences within power pools, but will need improvements in trading regulations,
wheeling methodology and regional grid codes.
Power system performance

According to World Bank Enterprise Surveys, unreliable electricity is perceived as a major
constraint by almost 40% of firms in sub-Saharan Africa (World Bank, 2019). The vast
majority of firms in sub-Saharan Africa experience electrical outages on a regular basis. In
many countries, outages average 200 to 700 hours each year. In some countries they can
be much worse than the average: A typical Nigeria firm experienced more than 32 electrical
outages in 2018. These outages can vary in duration from less than one hour to more than
a day, and in some countries they cost firms as much as a quarter of potential annual
turnover and up to 2% of annual GDP.
Technical electricity losses are also high in Africa: in 2018, average losses amounted to 16%,
which is almost seven percentage points higher than the average losses observed in other
developing countries (Figure 1.24). The scale of these losses also varies significantly by
region. In South Africa, average electricity losses were 9%. This is markedly lower than in
other sub-Saharan Africa and North Africa countries, where electricity losses hovered
between 17% and 19% respectively. Higher losses in these regions are a combination of a
number of factors including poor operational performance on the part of utilities and theft
of electricity from utilities. Reducing the level of losses would bring large efficiency gains.
Figure 1.24 ⊳ Average electricity losses in selected African power systems

today
5% 10% 15% 20% 25%
Ethiopia
Kenya
Ghana
Côte d'Ivoire
Northern Africa
Tanzania
DR Congo
Nigeria
Senegal
Africa
Mozambique
average
Angola
South Africa Developing countries average (excl. Africa)
Potential efficiency gains are possible by addressing the high levels of losses

The frequent power outages in sub-Saharan Africa have resulted in a proliferation of stand-
alone solar capacity and increased use of back-up generators to supplement the power
needs of industry and households (Box 1.5). In Ethiopia, which depends on hydropower for
1
much of its electricity generation, power rationing was in force during part of 2019 as a
result of mechanical difficulties at dams and low water levels resulting from diminished
rainfall (Africa Report, 2019). Kenya, South Africa, Zambia and Zimbabwe also experienced
electricity price hikes or outages during the dry season in 2019 as a result of low water
levels in hydropower systems. This may be a recurring problem if climate change results in
lower rainfall.
Box 1.5 ⊳ Use of back-up generators in Africa
The poor maintenance regime and ageing infrastructure in certain countries means that
electricity outages are an everyday affair for many Africans. On average, many parts of
countries such as Ghana and Mozambique experience outages once or twice a week.
This has a direct impact on the daily lives of citizens and on the ability of the country to
attract business, while the use of diesel fuel in back-up generators contributes
significantly to emissions of CO2 and air pollutant emissions.
IEA analysis estimates that 40 TWh of power was generated from 40 GW of back-up
generating capacity in sub-Saharan Africa in 2018, which is equivalent to 8% of
electricity generation. Nigeria accounted for almost half, generating 18 TWh of power
from about 9 GW of back-up generation (Figure 1.25). Most back-up generation is used
by businesses; households are often unable to afford the extra costs.
Figure 1.25 ⊳ Electricity demand served by back-up generators and share

of hours of electricity supply lost to outages in 2018
5 10 15 20 TWh
Nigeria
Other sub-Saharan Africa Industry
Angola Services
South Africa
Ethiopia Residential
Ghana Share of
DR Congo annual outages
Tanzania (bottom axis)
Senegal
Mozambique
Kenya
Côte d'Ivoire
10% 20% 30% 40%
Unreliable power supply means that businesses and households

turn to back-up generators in many sub-Saharan countries

Mini-grid and stand-alone systems
Grid extension is generally most cost effective when built to serve an area with a high
density of demand. In more isolated (and often rural) areas, decentralised systems may be
more cost effective. There are two main kinds of decentralised system: mini-grids and
stand-alone systems.
Mini-grids are localised power networks, with infrastructure to transmit electricity within a
defined service area. Generally, mini-grids provide electricity at a higher levelised cost than
the main grid. Like any grid, mini-grids need a stable flow of power to function properly and
often use either a small diesel generator or (increasingly) renewable-based power and
battery systems for back-up. Mini-grids also require a certain demand threshold to justify
the initial investment in the network, and therefore benefit from sizeable anchor loads
provided by industrial and commercial customers or public buildings such as hospitals and
schools. Mini-grids can be scaled up in line with rising demand, and eventually be
connected to the main grid.
Electricity access can also be provided through stand-alone systems. These are systems not
connected to a grid and typically power single households. Today, this market is dominated
by diesel generators and solar PV systems (solar home systems). Stand-alone systems may
be the most cost-effective option (from a system cost perspective) in sparsely populated
and remote areas. Both solar PV systems and batteries can be built at different scales to
match a need, which has led to innovative products coupling stand-alone generation with
appliances. These products can be scaled up as power demand grows, and can supply a
range of needs, from lighting and mobile phone charging to fans, televisions and
sometimes refrigerators. Table 1.3 describes the main features of the mini-grids and solar
home system markets and business models in sub-Saharan Africa.
The least-cost option to provide electricity access for a given area depends on its distance
from the main grid, current and expected demand, and the lifetime of the assets needed
for service delivery.10 Least-cost options are generally identified in National Electrification
Plans. Countries that have been successful in rolling these out tend to have plans that
specify the technical, institutional and financial aspects of implementation.
There are around 1 500 mini-grids installed across Africa today and 4 000 more are
planned; over half of them in Senegal and Nigeria, according to a 2019 World Bank market
report (ESMAP, 2019). Demand has increased reflecting reductions in the capital costs of
renewable-based generation. Policies and regulations have helped to promote investment
and increase private sector participation.
Access through stand-alone systems has also been on the rise in sub-Saharan Africa, where
East African countries are taking the lead. Almost five million people gained access to
electricity through solar home systems in sub-Saharan Africa in 2018.11 Many of these are
10
The IEA and the KTH Royal Institute of Technology Stockholm have developed a detailed geospatial model
determining least-cost technologies to achieve universal access to electricity in sub-Saharan Africa, which is
presented in detail in Chapter 3.
11
This figure is based on solar home systems of at least 8 W and does not include multi-lighting systems.

bought through the pay-as-you-go (PAYG) method, where private companies lease the
solar products to customers who pay periodic instalment costs and can become owners
once the loan is repaid. A market report prepared by a global association for the off-grid
solar energy industry (GOGLA) and others shows that PAYG accounted for more than 80%
1
of the value of sales (mostly solar home systems) made by the main private companies in
the second-half of 2018.
Table 1.3 ⊳ Features of mini-grids and solar home systems

in sub-Saharan Africa
Mini-grids Solar home systems

Systems installed 1 500* n.a.**
Capacity of Installed capacity varies substantially by • Entry level: 11.0-20.9 watts (W)
systems system and can range from a few kW to • Basic capacity: 21.0 - 49.9 W
above a MW, depending on number of • Medium capacity: 50.0 - 99.9 W
people supplied, demand and uses. • Higher capacity: > 100 W***
Business models • Private models, led mainly by private • Private models, led by private
applied developers but also demand-driven developers.
(e.g. small industries). • Some public programmes, led
• Public models, led by utilities. generally by rural electrification
• Co-operative models. agencies.
Private Description • Mainly pay-as-you-go (PAYG). Private • Mainly PAYG (e.g. lease-to-own:
business companies finance upfront customer makes small deposit
models investment costs and customers upfront and pays periodic
prepay for electricity. instalments).
• Revenues depend on customer • Revenues depend mainly on loan
demand and tariffs levels. repayment rates.
Tariff Depends on regulatory framework n.a.**
setting and/or system capacity, including:
• Set as per national uniform tariff.
• Set according to system cost-recovery
level and return on investment, often
with approval from regulator.
Ownership Mini-grids owned by developers or Customer acquires solar home system
of assets community. by the end of lease period (lease-to-
own model). Can also own it from the
beginning (in cash-based models),
though this is less common.
Main risks Regulatory risk (mainly around tariff Revenue risk (given customers have
setting and what happens when main low and unpredictable income).
grid arrives) and revenue risk.
* ESMAP (2019). ** Data on number or cumulative capacity of solar home systems in the region is not
available (n.a.). *** Categories as defined by GOGLA (2019).
Countries with clear targets, well-designed electrification strategies, and predictable policy
and regulatory frameworks show a consistent growth in sales and uptake of stand-alone
systems. Kenya and Ethiopia are cases in point. Tanzania was one of the first countries to
promote stand-alone systems, but recent policy uncertainty has led to stagnation in sales.
The commercialisation of these products has also been linked to business models that

promote local job creation and training. “Solar Sisters” is an initiative that trains local
women entrepreneurs to supply clean energy products to rural households and it is
impacting the lives of women and local communities (Box 1.6).
Box 1.6 ⊳ Impacts of clean energy entrepreneurship by women
Much of the existing research on access by women to renewable and clean energy
technologies has focused on decentralised solar and bioenergy projects that
disseminate technologies such as solar lanterns, improved cook stoves and solar home
systems. Initiatives such as Solar Sisters, Envirofit, Barefoot College, Kopernik and
Grameen Shakti have reached millions of low-income people in African and Asian
countries using similar strategies.
In 2015, the International Center for Research on Women conducted a qualitative
assessment in Tanzania to better understand whether and how being a Solar Sister
clean energy entrepreneur impacts women’s and men’s lives at the individual, family
and community levels. A secondary focus of the study was to reveal initial insights
about the benefits experienced by customers as a result of using Solar Sister’s clean
energy products. Solar Sister’s unique model of recruiting, training and supporting
female clean energy entrepreneurs was found to create benefits for individual women
and their households and communities by enhancing income and autonomy; business
skills and leadership; equality and communication; household health and stability; child
education; mobility and status; and community safety (Solar Sisters, 2019).
1.3.3 Fossil fuel resources and supply

Africa has large fossil fuel resources, with sub-Saharan Africa holding around half of the
continent’s oil and gas resources and nearly all of the coal resources. Remaining technically
recoverable oil resources in Africa amount to some 450 billion barrels or around 7% of the
world’s oil resources. The 100 trillion cubic metres of remaining recoverable gas resources
in Africa represent 13% of the world’s gas resources. Coal resources are relatively small and
concentrated in South Africa and, to a lesser extent, Mozambique (Figure 1.26).
Africa is also home to many of the minerals essential to the energy industry. It has around
20% of the world’s uranium resources and 40% of the manganese reserves. It also produces
a large share of key precious and base metals – for example, two-thirds of global cobalt
production comes from DR Congo.
The continent’s resource wealth has attracted interest from international companies.
Between 2011 and 2014, Africa accounted for around 20% of global oil discoveries with six
countries – Angola, Nigeria, Republic of the Congo (Congo), Ghana, Mozambique and
Senegal – adding around 5 billion barrels of offshore resources. With major discoveries in
Mozambique and Tanzania, Africa also accounted for around 45% of global gas discoveries
during this period.

Figure 1.26 ⊳ Remaining recoverable fossil fuel resources in Africa, 2018
Oil Natural gas Coal
450 billion barrels 100 trillion cubic metres 300 billion tonnes 1
Other North
Libya Africa
Other North
23% 18% Algeria Africa
26%
16%
Angola Other
10% sub-Saharan South Africa
Nigeria
16% Africa 72%
15% South Africa
Gabon Chad
13%
Mozambique
Other 5% 4%
Moza m-
Angol a 2%
sub-Saharan Other
bique 4%
Congo 3%
bi que /
Mozam-
Africa Nigeria sub-Saharan Africa

S.A. 2%
Ta nzania
16% 15%
8%
7% 20%
Africa has abundant fossil fuel resources;

sub-Saharan Africa accounts for around half of the continent’s oil and gas resources
Since the fall in oil prices in 2014, oil exploration has fallen sharply, and Africa accounted
for less than 10% of global oil discoveries between 2015 and 2018. There has however been
a series of major offshore gas discoveries in Egypt (2015), Mauritania and Senegal
(2015-17) and South Africa (2019) (Figure 1.27).
Figure 1.27 ⊳ Global discoveries of oil and natural gas by region
Oil Natural gas

16 80%
Billion boe
12 60%
8 40%
4 20%
2011
2012
2013
2014
2015
2016
2017
2018
2011
2012
2013
2014
2015
2016
2017
2018
Sub-Saharan Africa North Africa Middle East

Americas Rest of world Share of Africa (right axis)

Africa’s share in global oil discoveries has fallen markedly since the oil price fall,
but the region has seen significant gas discoveries
Note: boe = barrels of oil equivalent.

Oil
Oil production in Africa has seen major swings since 2000. In the early years after 2000,
sub-Saharan Africa showed strong production growth as the expansion in Nigeria and
Angola was joined by new producers such as Chad and Equatorial Guinea. The pace of
production growth in sub-Saharan Africa was four-times faster than the global average and
the region accounted for almost a quarter of global production growth between 2000 and
2010. This resulted in a 50% increase in net export volumes and, thanks to rising oil prices,
a threefold increase in oil revenue.
However, sub-Saharan Africa faced a sharp reversal of fortune after 2010. Nigerian oil
production started to decline from 2010 as regulatory uncertainties, militant attacks and
the theft of oil took their toll, and Nigerian sweet crude oil also faced fierce competition
from surging US tight oil output in export markets. Angola too struggled to keep up
production levels as new investments failed to compensate for the rapid decline in
maturing fields. Other producers such as Equatorial Guinea and Gabon also registered a
gradual output decline. As a result, oil production in sub-Saharan Africa decreased by 15%
from its peak in 2010 to 5 mb/d in 2018. Coupled with a 35% increase in domestic demand,
this led to a 35% decline in net exports and associated revenue (Figure 1.28).
Figure 1.28 ⊳ Changes in oil demand, production and net exports

2000-2010 2010-2018
2 Nigeria
mb/d
Angola
1 Others
-1
-2
Demand Production Net Demand Production Net
exports exports
Coupled with the continued increase in demand, falling oil production
in sub-Saharan Africa since 2010, led to a major drop in net exports
Major producers have recently managed to halt output declines. Nigeria’s production has
risen since 2016 as militant attacks in the Niger Delta have eased, but remains below the
peak level reached in 2010. Long-standing issues holding back upstream investment,
notably the uncertainties around the Petroleum Industry Bill, remain unresolved. In 2019,
Angola succeeded in mitigating output declines due in part to the start-up of the Kaombo
project, and the new government has initiated an overhaul of its oil and gas sector to
stimulate investment, creating a new regulator, reorganising the role of Sonangol and

streamlining investment procedures. In North Africa, output in Libya has been highly
volatile given the instability and unrest there. Production registered a major drop in
2011 and remains well below 2010 levels. Output in Egypt has been in gradual decline since
2014 as investments have been directed towards natural gas developments.
1
Although Africa remains a major crude oil exporter, its growing oil demand and under-
performing refining sector have combined to make it the world’s largest importer of
refined products. Africa holds 3.5 mb/d of refining capacity, which could theoretically serve
three-quarters of its oil product demand, but it runs at low utilisation rates. On average,
the utilisation rate was 58% in 2018; the rate was 25% in West Africa and just 9% in
Nigeria.12 African refineries tend to have fairly simple configurations, with low upgrading
capabilities, and often suffer from poor maintenance. They also face growing competition
from Asian and Middle Eastern refiners who are keen to export surplus diesel, and from
European refiners who want to export excess gasoline. Poor refining performance has led
to a growing deficit of refined products (Figure 1.29). Africa has now overtaken North
America as the world’s largest gasoline importer and is also the second-largest diesel
importer after the European Union (IEA, 2019b).
Figure 1.29 ⊳ Net imports of key refined products in selected regions
2008 2018
2.0
mb/d
1.5
1.0
0.5
Africa Southeast European North Africa Southeast European North

Asia Union America Asia Union America
Gasoline Diesel Kerosene Fuel oil
Growing demand for transport fuels and under-performing refineries have made
Africa the world’s largest importer of refined products
Natural gas
Africa’s gas production increased rapidly in the 2000s, led by strong growth in Nigeria
where the rise in oil production was accompanied by a large amount of associated gas, and
in Egypt where shifting attention to gas use brought about threefold production growth.
However Africa’s gas production stagnated from about 2010. Egyptian production started
to trend downwards until 2016 as unfavourable energy price schemes, mounting arrears to
12
Early data suggest that the utilisation rate dropped further to below 6% in the first-half of 2019.

international companies and social unrest caused a significant reduction in investment.
Nigeria’s rapid production growth also came to a halt as fiscal and legislative uncertainties
weighed on investment. Algeria managed to maintain output levels, although its largest gas
field, Hassi R’Mel, is already mature.
A series of major new gas discoveries seem likely to boost future gas production in Africa
(Figure 1.30). The start of production at the large Zohr offshore field has already led to a
turnaround in Egypt. A gas discovery on the maritime border of Mauritania and Senegal has
been followed by a final investment decision (FID) on the Tortue liquefied natural gas (LNG)
project. FIDs on new onshore liquefaction plants are coming to fruition in Mozambique to
13
exploit the huge offshore resources in the Rovuma basin. Total has also recently made a
significant gas condensate discovery off the southern coast of South Africa, and the
estimated volume of resources is over 20% of the world’s entire gas discoveries in 2018.
Gas in Africa is at a critical juncture (see Chapter 4). Where resources are plentiful, it could
provide the continent with additional electricity for baseload and flexibility needs, energy
for industrial growth and a sizeable source of revenue. But whether that happens depends
on countries with gas putting in place well-articulated strategies to turn the discoveries into
production and to build infrastructure to deliver gas to consumers cost-effectively in a
competitive global LNG market.
Figure 1.30 ⊳ Share of Africa in global gas demand and production, 2018,
and new discoveries, 2011-2018
Demand Production New discoveries

3% 1% 4% 2%
8%
33%
59%
96% 94%
North Africa Sub-Saharan Africa Rest of world
Recent discoveries offer the potential to fundamentally change the role of gas in Africa
Coal
Coal production in Africa is dominated by South Africa, which accounted for 93% of the
continent’s output in 2018. Production in the main current producing region in
13
Coral LNG reached a FID in 2017 and started construction in 2018. Mozambique LNG reached a FID in
2019 and Rovuma LNG by ExxonMobil is approaching a FID at the time of writing.

Mpumalanga province is starting to fall, and mining activities are now shifting to the
northern Limpopo province on the border with Mozambique (IEA, 2018c). Around two-
thirds of the country’s output is consumed in domestic markets and most of the rest is
exported via the Richards Bay Coal Terminal. Mozambique started coal production in
1
2010 and is the second-largest coal producer in Africa. Other countries such as Botswana
and Zimbabwe are aiming to ramp up coal output, although building infrastructure – rail or
roads – to connect production sites to demand or export centres remains a challenge.
Imperatives for resource producers
Energy resources have long been a crucial element in the economic outlook for Africa.
There is a chance that recent discoveries will lead more countries to join the ranks of
resource exporters. However, translating resource endowments into economic prosperity
can be a daunting task. The net income14 from resource production has been volatile over
the past few decades and has tended to lead to high levels of public spending during boom
times followed by periods of fiscal strain during downturns (Figure 1.31). This pro-cyclical
spending has often undermined the effectiveness of government expenditure in promoting
economic growth and structural transformation. Moreover, the rise of shale and the shift
to clean energy also pose serious questions for development models that rely heavily on
fossil fuels. It therefore is critical for both existing and potential producers to assess the
resilience of their resource production and associated revenues and devise productive ways
to manage and utilise resource income, a topic explored in more detail in Chapter 4.
Figure 1.31 ⊳ Net income from oil and gas production and government
expenditure in top-ten producers in Africa
400
300
200
100
2000 2002 2004 2006 2008 2010 2012 2014 2016 2018
Oil net income Gas net income Government expenditure
Net income from oil and gas production in Africa has been volatile as the impacts of
fluctuating commodity prices have been amplified by domestic circumstances
14
Net income from oil and gas production is defined as the difference between the costs of various types of
oil and gas production and the value realised from their sale on either domestic or international markets.

1.3.4 Renewable resources and supply
Africa is home to abundant renewable energy resources and its renewable energy power
potential is substantially larger than the current and projected power consumption of the
continent. Growth has been constrained, so far, by limited access to financing,
underdeveloped grids and infrastructure, unstable off-taker financial arrangements and, in
many countries, an uncertain policy environment (IEA, 2018b). Despite this, recent
advances in renewable energy technologies and accompanying cost reductions mean that
the large-scale deployment of renewable energy now offers Africa a cost-effective path to
sustainable and equitable growth. In many parts of Africa, decentralised renewable energy
technologies offer an economical solution for electrification in remote areas as well as for
grid extension.
Solar
A study undertaken by the International Renewable Energy Agency (IRENA, 2014) assessed
the theoretical potential of a range of renewable energy technologies in Africa
(Figure 1.32). It estimated that Africa’s solar PV theoretical potential could provide the
continent with more than 660 000 TWh of electricity a year, far above its projected needs.
East Africa was identified as having the highest theoretical potential (more than
200 000 TWh/year), followed by Southern Africa (more than 160 000 TWh/year).15
Figure 1.32 ⊳ Solar energy resource potential per year in Africa
West Africa
Southern Africa
CSP
North Africa
East Africa
Central Africa
West Africa
Southern Africa
Solar PV
North Africa
East Africa
Central Africa
50 000 100 000 150 000 200 000 250 000

TWh
East Africa and Southern Africa contain the highest solar resource potential
Note: CSP = concentrating solar power.

Source: IRENA (2014).
15
These potentials are purely theoretical potentials, with no techno-economic evaluation undertaken. These
resource potentials, therefore, are subject to a significant reduction when economic parameters are applied.

Development of solar in Africa has been slow, with only around 4 GW of new solar PV
capacity added between 2010 and 2018, more than two-thirds of it in sub-Saharan Africa.
The main challenges and barriers that countries face include limited institutional capacity
1
within government, lack of scale and competition, high transaction costs and the perceived
high risk of such projects (World Bank, 2018). This has prompted the World Bank to start
the Scaling Solar initiative to address these challenges by providing a “one-stop shop” to
help governments mobilise privately funded grid connected solar projects at competitive
costs.
IRENA also assessed the potential of CSP on the continent and estimated the likely
potential as being around 470 000 TWh a year. Again, East Africa has the highest potential,
followed by Southern Africa. Here too development has been slow with the exception of
large solar CSP projects in Morocco and South Africa.
Hydropower
Hydropower has been the main renewable energy resource developed to date with around
35 GW of hydro capacity across Africa, with Angola, Ethiopia, DR Congo, Zambia, South
Africa, Sudan, Mozambique and Nigeria each having 2 GW or more. Ethiopia has
hydropower capacity of nearly 4 GW and more developments are planned, most notably
the 6 GW Grand Ethiopian Renaissance Dam, which will be the largest in Africa when it
comes into service in 2022. South Africa has installed hydropower capacity of close to 4 GW
including the recent 1.3 GW Ingula plant.
Central Africa has very rich hydropower resources thanks mostly to the Congo River, the
deepest river in the world and the second-longest in Africa after the Nile. There is a large
mismatch between the significant hydropower potential in this region and the much more
limited local electricity demand. This means that large-scale regional interconnections will
be essential to promote its development. The DR Congo in particular has enormous
hydropower potential that has been estimated at 100 GW, which could generate about
774 TWh of electricity per year. Plans in DR Congo to develop the Grand Inga Dam further
have been beset with difficulties, but projects have been moving forward elsewhere.
While state-owned enterprises remain the largest developers of hydropower projects,

many have been built by Chinese developers and backed by concessional financing. Chinese
investors accounted for 60% of investment in sub-Saharan hydropower projects between
2010 and 2015.
Small-scale hydropower (1-10 MW) and mini-hydro power (0.1-1 MW) could provide power
for rural electrification in some areas of sub-Saharan Africa, and there is particular potential
in the central and south-eastern parts of the continent. A recent study estimated around
21 800 MW of small-scale hydropower technical potential (Korkovelos et al., 2018), with
the central corridor of the sub-continent and especially South Africa, DR Congo and Sudan
having the most potential. The same study also estimated that total mini-hydropower
technical potential in sub-Saharan Africa was around 3 400 MW.

Wind
With close to 5.5 GW of installed wind power capacity in 2018, there is plenty of room for
expansion given its theoretical potential to produce as much as 460 000 TWh of electricity a
year (IRENA, 2014). Most wind resources are found close to coastal locations, mountain
ranges and other natural channels in the eastern and northern regions of the continent.
Algeria, Egypt, Somalia, South Africa and Sudan are among the countries with the highest
wind energy potentials (IRENA, 2014). The best offshore wind energy potential is found off
the coasts of Madagascar, Mozambique, Tanzania, Angola and South Africa.
Wind can be cost competitive with other technologies where the resources are good, but
other factors could limit its deployment. For example, in East and North Africa, where the
best resource potential is estimated, domestic markets are small and power grids are not
well developed, meaning that significant variable generation from wind could be
challenging to manage without additional grid investment.
Geothermal
Geothermal resources can be found throughout Africa but the bulk of the potential is
concentrated in the East Africa Rift System, where total potential could be as much as
15 GW (BGR, 2016). This potential is largely untapped at present. Only Kenya has tapped its
geothermal potential and installed capacity of almost 700 MW. Other countries in East
Africa are now taking steps to make use of geothermal energy: Ethiopia is operating a
7 MW pilot plant and new developments totalling more than 1 GW are planned in Djibouti,
Eritrea, Tanzania and Uganda. The expansion of geothermal power in the East Africa region
faces a number of barriers, but technical and financial support is available (notably from
Japan) to help countries formulate geothermal master plans and to promote private sector
funding and local capabilities.
Bioenergy
Bioenergy continues to dominate the sub-Saharan energy mix and made up almost 60% of
primary energy use in 2018. Almost three-quarters of bioenergy demand are accounted for
by the traditional use of solid biomass in the residential sector, although there is also some
use of solid biomass and biogas for modern power generation and heat.
Bioenergy can generate around 800 MW of electricity from current installed capacity,
mainly in East and South Africa. However, large-scale deployment will be challenging, as
the levelised costs of power generation from bioenergy are often higher than gas-fired
generation and hydropower, due in part to the cost of collecting the biomass. Biogas has
emerged as a substitute for firewood for cooking purposes in some areas, primarily in rural
East Africa. Recently bio-slurry obtained from biogas production has started to be collected
and utilised as fertiliser to increase agricultural production. Although at present there are
technical and financial barriers limiting its application, biogas has a potentially important
role to play in reducing indoor air pollution and related premature deaths (especially of
women and children), limiting deforestation, and improving sanitation and the quality of
life (especially for women) in rural and agricultural areas.

Advanced biofuels for transport have significant potential in many African countries. West
Africa alone is estimated to have the potential to produce over 100 Mt per year of
agriculture residues that could be converted into electricity or advanced biofuels such as
1
ethanol and bio-butanol.
1.3.5 Environment
Water
Africa has less than 9% of the world’s renewable freshwater water resources, and more
than 50% of it is held in just six countries in Central and West Africa (UNESCO, 2019). The
continent is home to roughly 80 transboundary lakes and rivers with most large river basins
shared by five or more countries (UNECA, 2018b). Today, sub-Saharan Africa is in the midst
of its worst drought in 35 years. In 2018, Cape Town almost ran out of water. In 2019,
several cities in Mozambique, Zimbabwe, Ghana and Côte d’Ivoire experienced water
shortages. Alongside changing and uncertain precipitation patterns brought on by climate
change, Africa’s water scarcity is compounded by a lack of water storage, supply and
management infrastructure. By 2025, it is estimated that over 450 million people, mostly in
West Africa, could be at risk of water stress (UNECA, 2018b).
Agriculture is the largest water user in sub-Saharan Africa today, despite the fact that just
3% of its total cultivated land is irrigated. Groundwater is estimated to be plentiful — the
region withdraws less than 5% of its renewable groundwater whereas India, for example,
withdraws almost 60% — but there is increasing evidence that some aquifers are being
depleted (WWAP, 2019). Water use by the energy sector is low today, with coal and oil
accounting for most of it. However, water availability could increasingly become a critical
issue for energy sources, in particular for hydropower (see Spotlight in Chapter 3).
Household water use is also low and the World Health Organization (WHO) estimates that
on average a person in Africa uses just 20 litres of water per day, well below the
recommended minimum of 50 litres. Sub-Saharan Africa is also home to 745 million people
that have no access to safely managed drinking water (over 70% of which reside in rural
areas) and almost 840 million people that lack access to safely managed sanitation (roughly
60% of which are in rural areas) (UNICEF and WHO, 2019). Low rates of wastewater
collection and treatment mean that a significant amount of untreated wastewater is
released into the open. Contaminated drinking water has a significant health impact:
diarrhoea is a major cause of mortality for children under five in sub-Saharan Africa.
Significant progress will be required to reach the targets set under the Sustainable
Development Goal 6 (clean water and sanitation) by 2030 (Box 1.7). Water demand is
projected to increase more in Africa than in any other part of the world rising by almost
300% from 2005 to 2030, and a large share of it is projected to occur in municipalities
reflecting rapid urbanisation and more people gaining access to clean water (Wijnen et al.,
2018). This will also result in larger amounts of wastewater to be collected and treated
(which can increase energy demand depending on the level of treatment).

Box 1.7 ⊳ How does energy provision look different if viewed alongside
water and food?
Millions of people in sub-Saharan Africa do not have adequate access to the basic
building blocks of economic and societal development: energy, water and food. While
providing electricity access at a household level is critical, it is not enough on its own to
ensure economic development. Approaching development from an integrated water-
energy-food perspective allows for a broader and more durable view of local economic
development, and could also change the scale and type of the energy technologies
deployed. The value of this perspective for sub-Saharan Africa is visible at both a
household and a broad economic level. At a household level, it is clear that the
technologies being deployed to provide access to electricity can also be used to provide
access to clean drinking water (IEA, 2019c). At an economic level, viewing energy
development though this prism can advance the prospects for sustainable productive
uses, such as agriculture. Moreover, such an approach can help address the central role
of women in providing these resources.
The potential for such an approach is highlighted by a recent micro and macroeconomic
modelling exercise that looked at the Ikondo-Matembwe project in rural Tanzania
(RES4Africa Foundation, 2019). This project, which serves eight villages, consists of two
community-scale hydro-powered mini-grids that power an anchor client, an
agribusiness focused on producing animal feed, hatching poultry, and providing
electricity and water to the surrounding households. The preliminary results of this
study, which used a cost-benefit analysis based on the project’s investment data to
assess the benefits of single versus multi-service scenarios, indicate that over its
20-year lifespan a renewable energy-based integrated project has more than twice as
much economic impact16 on a local community as a project geared to the provision of
energy alone. Investing in an integrated approach also had a multiplier effect,
significantly increasing local purchasing power which translated into improvements in
other areas. Some of the biggest benefits came in the form of increased access to
better education, improved agricultural productivity and time saved from having water
and energy access on site.
More research and examples are needed of these kinds of projects to understand the
scope for replicating them at scale, but it is evident that looking at energy, food and
water together in an integrated way has clear potential to trigger captive energy
demand, increase economic productive capacity, and set African communities and
economies on a path that looks beyond the immediate imperatives to meet the
2030 sustainable development goals.
16
Measured in net-present value.

GHG emissions
In 2018, Africa accounted for around 4% of the world’s energy-related carbon dioxide
(CO₂) emissions despite being home to around 17% of the population. The power sector 1
was the largest emitting sector (480 Mt CO₂) followed by transport (355 Mt CO₂) and
industry (150 Mt CO₂).
Total energy related CO₂ emissions in North African countries in 2018 were around 490 Mt
or 40% of Africa’s energy-related CO2 emissions (1 215 Mt CO₂). South Africa’s energy
sector emitted 420 Mt CO₂ with its coal-fired power fleet responsible for more than half of
the country’s energy-related CO₂ emissions and more than three-quarters of the sub-
Saharan region’s power sector emissions.
While the sub-Saharan African energy sector makes a very small contribution to global CO₂
emissions, the region is among those most exposed to the effects of climate change. For
sub-Saharan Africa, which has experienced more frequent and more intense climate
extremes over the past decades, the consequences of the world’s warming by more than
1.5 degrees Celsius (°C) would be severe. Temperature increases in the region are projected
to be higher than average global temperature increase; regions in Africa within 15 degrees
latitude of the equator are projected to experience an increase in warmer nights and longer
and more frequent heat waves (UN, 2019b). A recent report published by the
Intergovernmental Panel on Climate Change found that the potential impacts of global
warming levels on key sectors at local to regional scales, such as agriculture, energy and
health, remain uncertain in most regions and countries of Africa (IPCC, 2018).
Local air pollution

Around 6.8 Mt of fine particulate matter (PM2.5) were emitted in Africa in 2018, of which
almost 85% was from the burning of biomass indoors. Damage to air quality from these
sources disproportionately affects the poorest in Africa. Nigeria, with its large population
and low levels of access to modern energy services, accounted for around a third of Africa’s
PM2.5 emissions, emitting 2.1 Mt in 2018. This compares to around PM2.5 emissions of
0.4 Mt in South Africa, 0.3 Mt in Tanzania and 0.2 Mt in Kenya in 2018. Efforts have been
made across the continent to reduce PM2.5 emissions mainly through incentivising the use
of modern cooking fuels, such as LPG and natural gas. South Africa’s National
Environmental Management Air Quality Act of 2004 is one example of an African country
regulating air quality and setting emissions standards, imposing limits on new and existing
power plants and industrial installations.
Nitrogen oxides (NOX) emissions in Africa were around 7.5 Mt in 2018, of which nearly 50%
came from vehicle tailpipe emissions, a further 18% from industry, 16% from the power
sector and 11% from buildings. In North Africa, vehicle tailpipe emissions made up almost
two-thirds of NOX emissions, reflecting the relatively high number of cars on the road. In
South Africa, which has sub-Saharan Africa’s largest car fleet, vehicle tailpipe emissions
accounted for about a third of NOX emissions: a further third came from the power sector
(33%), largely as a result of the large share of coal in South Africa’s power mix.

Figure 1.33 ⊳ Emissions of PM2.5, NOX and SO2 by sector in Nigeria, South Africa
and North Africa, 2018
Nigeria Agriculture
PM2.5
South Africa Buildings

North Africa
Industry
Nigeria Other energy sector
NOX
South Africa Power

North Africa Transport
Nigeria
SO2
South Africa
North Africa
500 1 000 1 500 2 000 2 500 3 000

kt
Nigeria accounts for a very large share of Africa’s PM2.5 emissions,
North Africa for a large share of NOX emissions and South Africa for its SO2 emissions
Note: kt = kilotonnes.
Source: International Institute for Applied Systems Analysis.
Sulfur dioxide (SO2) emissions were almost 5 Mt in 2018, almost 40% of which came from
power generation, largely as a result of coal combustion in South Africa, and nearly 40%
from the industry and transportation sectors (Figure 1.33).
In Africa, almost 500 000 premature deaths each year can be attributed to household air
pollution, a health problem which is closely related to the lack of access to modern forms of
energy. Fewer deaths in Africa are attributable to outdoor pollution than to household air
pollution, but the number still stands at more than 300 000 per year, with most occurring in
sub-Saharan Africa (excluding South Africa).

Chapter 2
Urbanisation, industrialisation and clean cooking

How fast will Africa grow?
S U M M A R Y
• Africa has the world’s fastest growing population: one-in-two people added to the
world population in the period to 2040 are African. With over 40% of the continent’s
population under the age of 15, it also has the world’s youngest population. This
young, expanding population is rapidly becoming more urban. The last two decades
have seen the number of people living in cities increase by 90%, and this trend is set
to accelerate over the next two decades. By 2040, an additional 580 million Africans
are living in cities – a pace of urbanisation that is unprecedented.
• The energy sector has a vital role to play in Africa’s future. Growing urban
populations imply rapid growth in material demand to build infrastructure,
expansion of industrial and agricultural production, and increased mobility of people
and goods, boosting energy demand. In the Stated Policies Scenario, the continent’s
economy grows to two-and-a-half times its current size by 2040.
• Our Africa Case outlines the implications for the energy sector of countries across
the continent realising their ambitions for accelerated economic growth and
universal access to energy. If the energy needs of the future set out in the Africa
Case are to be met in a sustainable way, a strong emphasis on improvements in
energy efficiency will be vital. Focus areas include fuel economy standards for cars
and two/three-wheelers (largely absent today), highly efficient industrial processes,
building codes and efficiency standards for appliances and cooling systems.
• The growth in population in areas with high average temperatures means that by
2040, if the global average temperature increase is kept to the limits of the Paris
Agreement, over 1 billion people in sub-Saharan Africa will be living in areas that
need space cooling (a number that increases to 1.2 billion if the world continues on
its current trajectory of warming). This means that cooling is set to be one of the
most important factors in determining the extent of future energy demand.
• Bioenergy is the largest source of energy in sub-Saharan Africa today and accounts
for two-thirds of final energy consumption. Around 850 million people in sub-
Saharan Africa rely on the traditional use of biomass, cooking with inefficient stoves,
while another 60 million rely on kerosene or coal to meet their daily energy needs.
Cooking with polluting fuels and stoves has major health and environmental
consequences, and was linked to almost 500 000 premature deaths in 2018. Less
than 200 million people in sub-Saharan Africa currently have access to cleaner
options such as liquefied petroleum gas (LPG), natural gas, electricity or improved
biomass stoves.
Chapter 2 | Urbanisation, industrialisation and clean cooking 79

Figure 2.1 ⊳ Final consumption by fuel, sector and scenario
in sub-Saharan Africa (excluding South Africa)
Fossil fuels Electricity Bioenergy

400
Mtoe
300
200
100
2018 2040 2040 2018 2040 2040 2018 2040 2040

STEPS AC STEPS AC STEPS AC
Final consumption Residential Transport Productive uses
Demand changes Higher GDP and access Efficiency gains Access and efficiency
In the Africa Case, efficiency gains reduce potential demand growth to 2040 by
one-third, while achieving SDG 7 reduces bioenergy use for cooking
Note: STEPS = Stated Policies Scenario; AC = Africa Case.
• Some progress is made in the Stated Policies Scenario in reducing reliance on the
inefficient use of bioenergy for cooking, but the number of people gaining access to
clean cooking barely exceeds population growth. Switching from the traditional use
of biomass to cleaner options faces both economic and non-economic barriers, but
the Africa Case sees all households across the continent gain access to clean cooking
by 2030, with benefits in particular for women and children. In the Stated Policies
Scenario, the number of premature deaths linked to indoor air pollution continues
to increase to 500 000 by 2030; in the Africa Case, clean cooking for all by 2030
reduces that number by more than two-thirds.
• Although nearly 600 million people in sub-Saharan Africa still use solid biomass in
improved cookstoves in the Africa Case in 2040, improved efficiency is enough to cut
bioenergy demand in half from today’s level. Charcoal use for cooking is increasing,
especially in urban areas, it remains an important source of energy in both cases in
2040. This makes improving efficiency along the charcoal value chain an important
priority.
• Biogas has the potential to provide 50 million tonnes of oil equivalent (Mtoe) of
locally produced low-carbon energy in Africa, largely via household-scale
biodigesters; this potential doubles to almost 100 Mtoe by 2040, at an average cost
of around $10 per million British thermal units (MBtu). The main economic barrier to
increased uptake is the upfront cost of installing a biodigester. Other barriers such
as maintenance requirements and feedstock availability can be overcome with well-
targeted policies and programmes.

2.1 Introduction
Africa’s population has grown by 470 million since 2000, making it the fastest growing
region in the world. It is also by some distance the youngest, with a median age of 20 years,
compared to a global average of 30 years (United Nations, 2019). Changing demographics
are at the heart of any discussion of economic development. Beyond the increase in the
number of people in the region, the unprecedented magnitude of the shift from rural to 2
urban living and the extent to which industrial development contributes a greater share of
economic output will have a profound impact on energy demand growth in the future.
Africa’s projected population growth could act as a catalyst for economic growth. However,
this will only be the case if there are enough job opportunities in productive enterprises to
fully capture the potential dividends of the demographic change.
As an ever-higher proportion of the African population moves to cities in the period to

2040, demand for energy services will inevitably grow. The average household in a city
consumes three-times more oil and electricity than the average rural household in sub-
Saharan Africa (excluding South Africa), although there are large disparities within cities. A
large part of the migration to cities is comprised of low or unskilled labourers — often
moving to peri-urban areas which are home to 55% of the urban population in sub-Saharan
Africa today (Odamo, 2019). In these areas, electricity access rates are lower than in the
heart of the city, although still much higher than in rural regions. Charcoal and firewood
remain the predominant cooking fuels in many peri-urban households, as traditional
practices tend to endure even when cleaner options are available.
Most energy in sub-Saharan Africa (excluding South Africa) is used for cooking, which
accounts for around 70% of total final consumption, compared to less than 10% globally.
Low rates of access to electricity, low levels of appliance and vehicle ownership, limited
transport infrastructure and low levels of industrial production explain why this is so.
Bioenergy is the major source of energy used to meet cooking energy needs in sub-Saharan
Africa (excluding South Africa). This cheap or free resource accounts for three-quarters of
total final consumption. Traditional use of biomass, often in poorly ventilated spaces, has
severe impacts on health and the environment. Efforts to improve access to clean cooking
lag far behind efforts to secure access to electricity. Globally, nearly 2.4 billion people
continue to use inefficient open fires or simple cook stoves today, around 840 million of
whom live in sub-Saharan Africa (excluding South Africa). To date, cleaner processed forms
of bioenergy like biogas and biofuels have made limited progress in the region.
In both the Stated Policies Scenario and the Africa Case, higher economic outputs and
higher household incomes lead to increased energy service demand in every sector. Total
final consumption in sub-Saharan Africa (excluding South Africa) grows by around 65% from
today to 2040 in the Stated Policies Scenario, with the share of all productive uses within
total final consumption rising as the scaling up of production leads to industry sector
energy demand more than doubling by 2040 (Figure 2.2). In the Africa Case, industry
energy demand more than triples on the assumption of accelerated industrial and

economic growth. Increased economic prosperity is reflected in terms of higher household
appliance ownership and expanding vehicle stocks. In the Africa Case, electricity demand
within households for cooling and appliances in sub-Saharan Africa (excluding South Africa)
rises 14% per year to reach more than 500 terawatt-hours (TWh) by 2040 (compared to
30 TWh today), with cities being responsible for more than 60% of this growth. Similar
trends are observed for passenger vehicles, with car stocks more than tripling to reach
27 million within two decades in the Stated Policies Scenario and more than 35 million in
the Africa Case. In 2040, over 80% of this passenger car fleet is operating in cities.
Figure 2.2 ⊳ Final consumption by sector and fuel in sub-Saharan Africa

(excluding South Africa) in the Stated Policies Scenario and
Africa Case, 2018 and 2040
2018 2040 STEPS 2040 AC
6% 10%
11% 16% 16%
23%
13%
16%
23%
71% 57% 38%
Sectors: Industry Transport Residential Other productive uses
50% 100% 50% 100% 50% 100%

Fuels Fossil fuels Electricity Bioenergy and other fuels
Economic growth spurs increases in energy demand in industry and transport.

Bioenergy’s share declines as households increasingly switch to cleaner fuels
The share of fuels in the energy mix of every sector sees some significant changes in both
scenarios. In the Stated Policies Scenario, bioenergy remains the largest source of energy,
with a share of just under 60% in 2040 in sub-Saharan Africa (excluding South Africa), and
total bioenergy consumption increases from 300 million tonnes of oil equivalent (Mtoe)
today to 380 Mtoe in 2040. In the Africa Case, extending energy access to the entire
population by 2030 (UN Sustainable Development Goal [SDG] 7) is achieved via a
combination of improved cook stoves, liquefied petroleum gas (LPG), electrification,

ethanol and other solutions. Bioenergy demand is cut in half, as the number of people
relying on the traditional use of biomass drops to zero and kilns to produce charcoal
become more efficient.

We analyse how the electricity sector can be expanded to supply the increased demand
caused by urbanisation and electrification in Chapter 3, and carry out the corresponding
analysis for fuel supply in Chapter 4. In this chapter, we assess the role of demand-side
policies and aim to answer three crucial questions. What are the implications of rapid
urbanisation and industrialisation for energy use in Africa? What role could a more efficient
use of energy play in accelerating Africa’s economic development? What is needed to reach
full access to clean cooking? 2
2.2 Urbanisation and industrialisation, drivers of growth

The urban population in sub-Saharan Africa is growing rapidly, more than doubling since
2000 to reach 440 million today. The share of the population living in cities is now 40%, up
from 32% in 2000. There are 520 million more people in cities in sub-Saharan Africa in 2040
than there are today (along with an extra 60 million in North Africa). Urbanisation of this
scale and at this speed has never been seen before, and is expected to be twice as large as
the projected growth of urban population in India over the next two decades.
Figure 2.3 ⊳ Urban population growth and cement demand in

China (historical), India (Stated Policies Scenario) and
Africa (Africa Case)
Urban population growth Cement demand

600 1 800
Mt
Million people
China
400 1 200
India
200 600
Africa
China India Africa 1990 2000 2010 2020 2030 2040

1990-2010 2018-2040 2018-2040
Africa experiences unprecedented growth in its urban population,
but follows its own trajectory for cement demand
Note: Urban population in Africa is assumed to be the same in both the Africa Case and Stated Policies
Scenario.
Africa’s rapidly increasing population and growing urbanisation bolsters demand for
materials. This could underpin industries that in turn stimulate further growth and income
generation on the continent. As a point of comparison, China’s economic boom between
1990 and 2010 saw the population of cities increase by 360 million: cement production

grew ninefold during this period, while iron and steel production increased ten-fold.
Africa’s future infrastructure is however unlikely to follow the same path as China’s.
Traditional materials and designs look set to play an important role in Africa, and so do
local innovations.1 Therefore, Africa is likely to follow its own growth trajectory (Figure 2.3).
As well as mitigating the growth of cement and steel demand, an approach tailored to
African conditions would help promote a housing stock suited to the climate, which in turn
would act to offset some of the growth in demand for cooling. New initiatives could bring
about urbanisation with reduced resource needs. Adobe houses, and bamboo- or wood-
based low-storey buildings are examples of what may be possible in this context
Per capita energy consumption across sub-Saharan Africa is extremely low, at less than a
third of the global average. This is, in part, a reflection of the fact that a higher percentage
of people live in rural areas in sub-Saharan Africa than in any other region in the world,
which makes it more difficult to achieve access to electricity and clean cooking for all (see
Chapter 1). But it also reflects lower than average consumption across end-use sectors.
There are, of course, large disparities both between and within countries, but the level of
car ownership illustrates the size of the gap in energy services: at 115 cars per
1 000 people, South Africa’s ownership rate is eight-times the sub-Saharan African average,
but stands at one-quarter the average for advanced economies globally, while in Ethiopia
the ownership of vehicles is less than 2 cars per 1 000 people. The potential for growth in
energy consumption in the transport sector is very large, and an increase in the number of
two/three-wheelers is already taking place in a number of sub-Saharan African countries.
There are other examples as well of low levels of energy consumption and potential for
strong future growth. About 680 million people are located in hot areas in sub-Saharan
Africa (where the average perceived daily temperature2 exceeds 25 degrees Celsius (°C)
over the whole year) which would typically require the use of cooling devices such a fan or
air conditioner. However, only around 10 million households own an air conditioner across
sub-Saharan Africa, while 100 million own an electric fan. The inevitable increase in future
demand for cooling (spurred by population and income growth, the move to cities and
climate change), requires a fundamental rethink not only of the way energy is produced
and consumed across the continent, but the way the urban environment is constructed
(Box 2.1).
Large infrastructure projects, from maritime port expansions to railway modernisation, are
one of the main drivers of growth in materials demand (Table 2.1). The choice of whether
industrial products will be imported (as they mostly are now, with the exception of
cement), or produced domestically (underpinning a potentially transformative industrial
growth story), will have major implications for Africa’s energy and economic sectors.
1
For example, a Colombian company has exported its manufacturing experience of producing bricks from
used plastics to Côte d’Ivoire, where the aim is to build 500 classrooms using this technology by 2020.
2
The combined effects of air temperature, relative humidity and wind speed.

Table 2.1 ⊳ Selected large infrastructure projects in Africa
Proposed Cost
Project Countries involved construction estimate
start ($ million)
Abidjan - Ouagadougou transport corridor Burkina Faso and Côte d’Ivoire Unknown 600
Batoka Gorge Hydropower Project Zambia and Zimbabwe 2020 4 500
Brazzaville - Kinshasa Road/Rail Bridge DR Congo and Republic of Congo 2020 550 2
Dar es Salaam Port Expansion Tanzania and neighbouring 2020 420
countries
Grand Ethiopian Renaissance Dam Ethiopia In progress 5 000
Inga 3 Hydropower Plant DR Congo and regional partners 2024-25 12 000-
14 000
Juba - Torit - Kapoeta - Nadapal - Eldoret Kenya and South Sudan Unknown 420
Road Project
Lamu Port Kenya 2020 3 100
Modernisation of Dakar-Bamako Rail Line Senegal and Mali Unknown 3 000
New Administrative Capital (Egypt) Egypt Unknown 20 000
Ruzizi III Hydropower Project Burundi, DR Congo and Rwanda 2020 600
Sambangalou Hydropower Project Guinea, Senegal and other West Unknown 455
African Power Pool member
countries
Serenje - Nakonde Road Project Zambia and regional partners In progress 674
Trans-Saharan Gas Pipeline Nigeria, Niger and Algeria Unknown 10 000-
13 700
Zambia Tanzania Kenya Transmission Line Kenya, Tanzania, Zambia Unknown 1 200
Box 2.1 ⊳ Design, build and strengthen sustainability for African cities
Among the 534 cities of more than one million inhabitants across the world today,
66 are in Africa (Demographia, 2019). Uncontrolled urban development is making living
conditions more precarious: some cities in Africa already suffer from population
displacement and serious congestion.
About 85% of the inhabitants of today’s African cities live in areas denser than
metropolitan Paris (Figure 2.4). Although densely populated cities can ease the
provision of services, they can exacerbate air and noise pollution and increase demand
for space cooling. Temperatures in densely populated cities can be 3-5 degrees higher
than in low-density neighbourhoods due to human activity, heat radiation from
concrete, asphalt and other materials as well as an increasing number of air
conditioners that move heat from inside to outside of buildings (Tremeac et al., 2012).
In 2040, there are twice as many people in cities in Africa as there are today. Strong
policy ambitions, long-term investment and sound urban planning are needed to
harness the opportunities and overcome the challenges of urbanisation and the rise of
medium-size cities. Training, capacity building and engagement at the national, regional
and community levels are critical to ensure that solutions are tailored to local needs. In

order to balance economic and environmental aspirations, policy makers and urban
planners need to plan for growth in energy demand related to the manufacturing,
transport and use of building construction materials. From now to 2040, the equivalent
of all built surfaces in Ethiopia are added every year to Africa’s built environment.
Material efficiency strategies including building design, lifetime extension and waste
reduction are an essential part of this planning.
Figure 2.4 ⊳ Urban population by density in cities of more than one million
inhabitants in Africa and density of selected cities, 2018
50 North Africa
Million people
40 South Africa
30 Other
sub-Saharan
20
10
0-2 2-4 4-6 6-8 8-10 10-12 12-14 14-16 16-18 >18 Thousand people
Shanghai London Singapore per km2
New York Paris Tokyo Lagos Cairo Delhi Yaounde Kinshasa
0 2 4 6 8 10 12 14 16 18 20 22 24
Thousand people per km2
Growth and increasing density in African cities create both

opportunities and challenges for policy makers and urban planners
High-density urban areas could provide opportunities to scale up the high energy
performance construction market. Passive design allowing for natural ventilation and
solar heat gain reductions could slash air conditioning demand by 65-70% in climates
similar to coastal Senegal (Harkouss et al., 2018). They also fit well with other energy-
efficient design strategies such as increasing natural daylight intake.
Providing infrastructure and promoting rules that encourage public or non-motorised
transit could reduce the impact of urban growth on energy demand for transport in
Africa. Bus rapid transit systems generally require low shares of public subsidies since
moderate capital investment can sustain a large passenger throughput. Urban planning
and city structure also matter. Planning should ideally lead to a mix of land uses –
residential, commercial and industrial – while promoting walking, cycling and mass
transit. Urban planners equally need to address current practices leading to sub-optimal
choices such as importing old second-hand vehicles that pollute, the provision of
free/cheap parking and the remuneration of public transport operators on the basis of
number of passengers transported per day.

A number of countries, including Nigeria, Mozambique and Angola, have included steel and
chemicals in their industrial development strategies. The Action Plan for the Accelerated
Industrial Development of Africa (AIDA) initiative counts among its ambitions the
development and implementation of industrial policy that promotes local production and
upgrading of existing industrial technologies. At regional level, the initiative encompasses
programmes such as the development of regional industrial strategies, the creation of
industrial development funds for infrastructure and heavy industry, and support for 2
incubators. At continental level, the AIDA initiative aims to harmonise industrial policies
and promote development partnerships. The realisation of these ambitions is closely bound
up with the evolution of the energy sector. Industrial expansion requires more energy than
is produced today. It is also likely to accelerate urbanisation, leading to increased energy
demand in households and for transport. At the same time it could generate higher
incomes, further increasing energy demand. The upside for industrial output is explored in
detail in the Africa Case.
Figure 2.5 ⊳ Change in total final consumption by sector and energy type in
sub-Saharan Africa (excluding South Africa) in the Stated Policies
Scenario and Africa Case, 2018-2040
STEPS
Residential
AC
STEPS
AC Transport
STEPS
AC Industry
STEPS Services and

AC agriculture
-200 -100 0 100

Mtoe
Bioenergy Oil Gas Electricity Other fuels
Higher economic growth in the Africa Case sees increasing demand for all fuels, except
bioenergy, with access to clean cooking for all and efficiency gains driving its reduction
Greater economic output, higher household incomes and improved living standards also
mean that car, appliances and cooling systems ownership rates in sub-Saharan Africa are
higher in the Africa Case than the Stated Policies Scenario. The impact on energy
consumption is mitigated to some extent by the implementation of more stringent vehicle

efficiency policies and regulations, notably on the second-hand market. In the residential
sector, building energy efficiency codes and higher minimum energy performance
standards (MEPS) for appliances and cooling systems help to slow electricity demand

growth in the Africa Case. Building codes also play an important role in the construction
industry (only 30% of the building stock anticipated for 2040 currently exists). These codes
require countries to establish regulatory frameworks to set performance standards and
ensure compliance with them.
Overall, the reduction in bioenergy use in the residential sector in the Africa Case and the
increased focus on energy efficiency, mean that total final consumption in 2040 in
sub-Saharan Africa (excluding South Africa) is lower in the Africa Case than in the Stated
Policies Scenario, despite an economy that is 60% larger (Figure 2.5).
2.2.1 Residential sector

The residential sector accounts for around 65% of total final consumption of energy in
sub-Saharan Africa (compared to 22% globally and less than 20% in advanced economies),
making it the largest end-use sector across sub-Saharan Africa. In the Stated Policies
Scenario, increasing incomes and living standards, as well as improved access to affordable
and reliable electricity, leads to a steady increase in energy consumption in the residential
sector. However, its share in overall consumption diminishes to around half in 2040 as
energy demand in industry grows at a rate that is nearly triple that of the residential sector.
In the Africa Case, overall demand in residential buildings actually decreases by around
one-quarter as a result of efficiency improvements and the rapid displacement of biomass
in cooking (see section 2.3). Together with the accelerated industrialisation included in the
Africa Case, this fall in demand reduces the share of the residential sector to around one-
third of overall consumption by 2040.
Figure 2.6 ⊳ Final consumption of selected fuels in the residential sector in

Scenario and Africa Case, 2018 and 2040
Oil and natural gas Electricity

50
Mtoe
40
30
20
10
2018 2040 STEPS 2040 AC 2018 2040 STEPS 2040 AC

Final consumption Lighting and appliances Space cooling Water heating and cooking
Demand changes Higher GDP Access Efficiency gains
More efficient cookstoves, air conditioners and appliances

temper energy demand growth from households

In the residential sector, oil and electricity are increasingly used for cooking and water
heating in both scenarios, with LPG making big inroads (Figure 2.6). There is a major shift
away from the traditional use of biomass, and universal access to clean cooking is achieved
by 2030 in the Africa Case, fulfilling SDG target 7.1. Use of natural gas expands in cities that
are able to make use of nearby gas resources.
In the Africa Case, rising incomes and access to basic energy services mean that demand for
2
electricity grows more than for any other energy source (see Chapter 3). Demand for
lighting and other appliances grows sixfold to 2040, while demand for cooling increases by
more than 13% per year to 2040 in the Africa Case, making the issue of cooling one of the
most consequential in determining the extent of future residential energy demand (see
Spotlight). The consequences for energy demand of meeting this challenge can be
mitigated by ensuring that sustainability is central to the choices made when designing
Africa’s future built environment (Box 2.1). Rigorous efficiency standards for new cooling
systems (fans and air conditioners) and better design of new buildings are both central to
the Africa Case and help to avoid 110 TWh of additional electricity demand (around 15% of
residential electricity demand in 2040). Efficiency standards for major appliances avoid an
additional 180 TWh.
S P O T L I G H T
Is cooling comfort achievable for Africa in a warming world?
Roughly 680 million people in Africa (more than half of the population) currently live in
areas that may need cooling systems.3 This share varies by country: in Egypt and
Tanzania, less than 40% of the population live in places that have daily average
temperatures above 25 °C, while in countries such as Niger, Senegal and Sudan, nearly
the entire population does.
Overall, around one-quarter of the global population that needs cooling today lives in
Africa. Yet ownership of cooling devices is rare; air conditioner ownership across Africa
averages only 0.06 units per household, while fans are somewhat more common
averaging 0.6 units per household. Ownership rates reflect differences in income levels
and climate. Wealthier countries such as Morocco, Algeria and Tunisia have air
conditioner ownership rates that are three-times the African average, despite a lower
than average number of cooling degree days (Figure 2.7).4 In contrast, less affluent
3
Cooling needs exist across multiple sectors, inter alia, providing health services, air conditioning in
commercial buildings, cold storage for agricultural products, transport cold chains; this Spotlight highlights
the biggest growth projected which is for residential buildings.
4
Thermal comfort is measured in cooling degree days (CDDs), a universally recognised metric that allows
comparison of cooling needs between regions. A CDD measures how warm a given location is by comparing
actual temperatures with a standard base temperature (usually 18 °C). Calculating annual CDDs for a
location gives an indication of cooling needs. CDDs can also include a heat index correction to account for
the influence of humidity on perceptions of temperature and cooling needs. Many locations across Africa
experience 4 000 – 5 000 CDDs annually, an order of magnitude higher than in countries such as France (230)
and Italy (630). The number of CDDs in Africa dwarfs the major cooling demand centres of the United States
(3 150) and China (1 100).

90
Figure 2.7 ⊳ Cooling degree days in the Stated Policies Scenario and cooling electricity demand, 2018 and 2040
2018 2040 Residential cooling

demand
250
TWh
TWh
without efficiency improvement
efficiency improvements
200
Additional without
Additional demand
150
Africa Energy Outlook 2019 | Special Report
100
50
2040 2040
0 3 000 6 000 2018 STEPS AC
Cooling degree days
Urban migration alongside a big increase in the number of hot days in Africa’s cities will drive major growth in demand for cooling needs
Notes: Every dot represents a dense area in terms of population (> 4 000 person/km2) or more than 25 000 people. The thickness of the dot is proportional to
population densities. Sources: Derived using NOAA (2018) and NCAR (2012) assuming the Representative Concentration Pathway (RCP) 2.6 Scenario (IPCC, 2014) and
using a base temperature of 18 °C, taking humidity into account. Population data are derived from KTH-dESA (GitHub), Khavari et al. (2019) and from Africapolis.org.
countries with much higher cooling needs, such as Togo, Senegal and Niger have
ownership levels that are half the African average or less.
The costs associated with operating an air conditioner are a big barrier for many
households, an issue that is compounded by comparatively inefficient equipment. The
average seasonal energy efficiency ratio (SEER), the level of cooling for any given unit of
energy consumed, is on average almost 30% lower for a typical air conditioner in Africa 2
than the world average. The average air conditioner sold in Africa is also typically less
than half as efficient as the best available units on the market, reflecting Africa’s
currently weak air conditioner energy performance standards: most countries in Africa
lack any mandatory standards for air conditioners, while standards are also weak for
fans. Recent policy progress and proposed minimum energy performance standards in
countries such as Kenya, Rwanda and Morocco point the way forward.
Population growth, urbanisation and climate change significantly increase the need for
cooling in Africa. By 2040 more than one billion people need access to cooling in the
Africa Case (Figure 2.8), a scenario that matches the ambitions of the Paris Agreement
(this number increases to 1.2 billion if the world continues on its current trajectory).
The anticipated increase in temperatures across the continent is higher than the global
average, with Somalia, Ethiopia and Gabon being the countries most exposed.
Figure 2.8 ⊳ Population with cooling needs and ownership in the Stated
Policies Scenario and Africa Case, 2018 and 2040
3 000 1.5 Population

Million people
Units per household
Africa
Rest of world
2 000 1.0
Ownership (right axis)
Fans
Africa
1 000 0.5 Rest of world
Air conditioners
Africa
Rest of world
2018 2040 2040
STEPS AC
Growth in the global population with cooling needs by 2040 is concentrated in Africa,
but ownership of cooling devices remains lower than the global average
While the African continent experiences the largest increase in cooling needs by 2040,
the Stated Policies Scenario points to air conditioner ownership in Africa growing to an
average of just over 0.15 units per household (compared to a world average of 1.15 in
2040), ownership of fans increases to almost 0.8 units per household. While this means

tens of millions of air conditioners and fans are sold in Africa in the coming decades, it
still falls short of providing access to thermal comfort to millions of Africans.
In the Africa Case, cooling is more widely available: universal electricity access and
higher levels of household income lead to demand for cooling increasing to over
110 TWh in 2040 in Africa, almost double the level of demand seen in the Stated
Policies Scenario. More stringent policies for cooling equipment efficiency, and passive
cooling through better design of buildings and use of vegetation in the Africa Case
mean that around 110 TWh of additional demand are avoided.
2.2.2 Transport sector

Sub-Saharan Africa (excluding South Africa) has the world’s lowest per capita car ownership
level. It has a smaller passenger car stock than Australia, whose population is 95% smaller.
In all scenarios and cases presented in this World Energy Outlook, there is a large expansion
of the passenger car stock in the period to 2040 (Figure 2.9). In the Stated Policies Scenario,
the car fleet in 2040 in sub-Saharan Africa (excluding South Africa) triples to reach
27 million, but this still means average ownership levels of only 15 cars per 1 000 people,
equivalent to 60% of the rate in India today. Factoring in an accelerated rate of economic
growth, as in the Africa Case, the car fleet reaches more than 35 million.
Figure 2.9 ⊳ Vehicle ownership by country in the Stated Policies Scenario and
Africa Case, 2018 and 2040
Cars Two/three-wheelers 148

75
Vehicles per thousand people
50
25
Angola
Angola
Tanzania
Tanzania
Nigeria
Nigeria
Kenya
Kenya
Dev. economies
Dev. economies
Senegal
Senegal
Ethiopia
Mozambique
Ethiopia
Mozambique
DR Congo
DR Congo
Ghana
Ghana
Côte d'Ivoire
Côte d'Ivoire
2018 2040 additions in STEPS 2040 additions in AC
Vehicle ownership doubles in sub-Saharan Africa (excluding South Africa) in the

Stated Policies Scenario; the Africa Case provides a further boost, yet rates remain low
Note: Dev. economies = developing economies; DR Congo = Democratic Republic of the Congo; STEPS =
Stated Policies Scenario; AC = Africa Case.

The increase in road transport demand fuels a significant rise in oil use in Africa. Under the
assumptions of the Stated Policies Scenario, oil demand for transport grows from just over
1 million barrels per day (mb/d) today to reach 2.2 mb/d by 2040. Demand is slightly higher
in the Africa Case, at 2.5 mb/d, but this assumes 8 million additional cars, with the
increased efficiency of the fleet avoiding the consumption of nearly 320 thousand barrels
per day (kb/d) in 2040 (Figure 2.10).
2
As is the case with residential energy demand, there is a large discrepancy between
demand in cities and rural areas. The 6.6 million passenger cars in cities in sub-Saharan
Africa (excluding South Africa), represent almost 80% of the total car stock of the region
today. This number rises by almost 6% per year in the Stated Policies Scenario, raising the
total to close to 23 million cars in cities by 2040 and bringing the share of cars in urban
areas to 85% of the total stock. In the Africa Case, the number of cars grows by more than
7% a year increasing the urban car stock to nearly 30 million by 2040. Rural areas account
for over half of the current stock of 16 million two/three-wheelers in the region: in both the
Stated Policies Scenario and the Africa Case, they continue to account for a sizeable 40%
share of the stock of two/three-wheelers through to 2040.
Future demand for energy in the transport sector is determined not just by the number of
vehicles on the road but also by their condition. Up to 80% of cars for personal transport
are used cars imported from Japan and Europe which no longer meet emissions standards
in those countries. The situation is not much better for new cars: only Nigeria (Euro 3) and
South Africa (below Euro 3) have any emissions standards in place for new car sales (UNEP,
2017), and the Euro 3 standard was superseded in Europe almost two decades ago.
Members of the East African Community recently agreed to adopt Euro IV/4 equivalent
standards for new vehicles (UN Environment, 2019). The average fuel economy of cars on
the road in sub-Saharan Africa is 8.4 litres per 100 kilometres (L/100 km), less efficient than
the average 7.4 L/100 km in North African countries. Among several possible solutions, the
most practical would be to ensure a uniform age limit on imported cars across all African
countries and to ban the import of cars that do not meet minimum emissions standards.
Currently more than half of African countries do not impose any restrictions on second-
hand vehicle imports, while for those that have set restrictions, half of them apply age
limits of between 8-15 years (UN Environment, 2019). Lower age limits on imported
vehicles would significantly improve average fleet efficiency. Angola was a first mover
among sub-Saharan countries, with an age limit of three years. Fuel quality specifications
could also bring significant benefits, not least in reducing pollution. Here the East African
Community is leading the way: it harmonised fuel quality standards in 2016, setting sulfur
limits for gasoline of 150 parts per million (ppm) and for diesel of 50 ppm.
Africa is one of the world’s fastest growing markets for two/three-wheelers, with
momentum partially driven by the increasing number of cheap second-hand motorcycles
imported from Asia. Market growth means that the number of motorcycles in Africa is set
to surpass the number of private cars by 2040. However, the market for two/three-
wheelers in Africa is largely informal and unregulated, and market growth has not been

accompanied by a shift to electric options as part of a transition to low-carbon transport
and emissions reductions. Electric two/three-wheelers have a lot of potential value given
the expected increases in demand for mobility and the current low levels of mobility in
most parts of rural and urban areas in Africa, especially since travel in rural areas often
involves long distances and fuel quality is less reliable. The higher upfront costs of an
electric two/three-wheeler as compared with a conventional one would be offset by lower
maintenance and operating costs, depending on the distances travelled and fossil fuel
prices; the payback period could be two to three years. The lack of reliable access to
electricity however is a major barrier to electrification of these vehicles, especially in rural
areas where two/three-wheelers play a prominent role. Even when full access is achieved,
decisions will be required on the extent to which transport should be a priority for
electrification over other end-use sectors.
Figure 2.10 ⊳ Oil demand for transport in sub-Saharan Africa (excluding South
Africa) in the Stated Policies Scenario and Africa Case
2030 2040
3 Transport mode
mb/d
Non-road*
Road passenger
2
Road freight
Demand changes
1 Higher GDP
Efficiency gains
2018 Stated Africa Stated Africa

Policies Case Policies Case
Introduction of fuel economy standards could avoid 0.32 mb/d of oil

demand growth driven by the fleet expansion
* Non-road includes aviation, shipping, rail and other transport.
Increased industrialisation means more transport of raw and finished goods, leading to
higher demand for freight vehicles, rail, navigation and aviation. The new African
Continental Free Trade Agreement should also stimulate improved connectivity between
countries to facilitate goods transport from regions of production to major commercial
centres and ports. A transcontinental railway financed by China is already in the works: it
plans to connect shipping ports in West and East Africa and it is possible that it may link
more than ten countries including Angola, DR Congo, Zambia, Tanzania and Kenya. Such
projects should help to support the economic development of landlocked African nations
and enhance trading and mining activities in the region significantly.

Box 2.2 ⊳ Gender and mobility in Africa
Improving transportation is a big challenge for sub-Saharan Africa countries, and

discussions on how best to deliver improvements must take account of the needs of
women in both urban and rural communities. In cities, factors such as financial
constraints, cultural norms prioritising asset allocation to men, and security concerns
limit access to transport for women. In rural areas, women and children are more 2
vulnerable than men to the negative impacts of a lack of transport options. Long
distance walks to fetch water or wood for fuel, and to reach healthcare facilities and
schools are a major obstacle in the daily lives of women. The effects range in severity
from loss of productive time to reduced literacy rates and risks to personal safety.
Proper transport planning needs to consider the different mobility needs of women and
men throughout the day and to seek to ensure that women remain safe when
travelling.
In sub-Saharan Africa, maternal mortality and morbidity rates continue to be high
(Hofman et al., 2008; AMANHI, 2018). Although there are many factors in addition to
obstetric causes that contribute to high mortality in sub-Saharan Africa, one is the delay
in reaching emergency care. Emergency and routine medical check-ups for the elderly,
children and women are critical to achieving most of the sustainable development
goals, specifically SDG 3 on healthy lives and wellbeing, but rural populations in
sub-Saharan Africa often still find it difficult to access healthcare and other essential
services due to lack of mobility. Light two/three-wheelers could make a big difference
to rural mobility in Africa. They are extremely popular in large, developing countries
such as China and India and have great potential to improve women’s lives in Africa.
Electric two/three-wheelers would avoid air pollution issues and, provided that
electricity is available, may be cheaper than fossil fuel powered alternatives.
Is there a role for biofuels for transport?

Biofuels account for less than 0.1% of transport energy use in Africa today, but there is
strong potential for growth. The market grew 5% in 2018, mainly led by South Africa and
Nigeria.
The potential for production of advanced biofuels in many African countries is enormous,
thanks to the size of the continent’s agricultural sector. Increasing biofuel production from
the transformation of agricultural waste can be sustainable if based on the intensification
of crop production and livestock grazing on existing agricultural lands, rather than the
extension of crop and grazing lands (IRENA, 2017). Relying on intensification rather than
extension reduces negative environmental impacts such as deforestation, land-use change
and associated greenhouse-gas emissions. East Africa alone is estimated to have the
potential to produce over 100 million tonnes (Mt) of agricultural residues per year, which
could be converted into advanced biofuels like ethanol and bio-butanol (Bentsen et al.,
2014). Realisation of this potential will depend on whether using this resource for biofuels

production can compete in terms of cost-effectiveness with other potential uses of these
residues such as direct combustion and electricity generation.
Many countries have announced mandates for boosting the use of biofuels in the transport
sector, with the most popular mandates being ethanol blending rates of 5% or 10% (E5 and
E10). Table 2.2 lists the intended biofuel blending targets and mandates of major African
economies. In both the Stated Policies Scenario and the Africa Case, biofuels represent only
a small share of total fuel consumption for the road transport sector, accounting for 1.5%
and 2.5% respectively of the overall fuel consumption in road transport. The evolution of
the biofuels market in the Africa Case takes into account the potential supply of agricultural
residues in key African countries.
Table 2.2 ⊳ Biofuel blending mandates for transport for selected countries in
sub-Saharan Africa
Potential from
Country Mandate Target
agricultural residues
Angola Ethanol 10 11%
Ethiopia Ethanol 5 Ethanol 10 n.a.
Ghana Replace 10% of fossil fuels by 2020 n.a.
and 20% by 2030
Kenya Ethanol 10 Ethanol 5, Ethanol 10 5%
Malawi Ethanol 10 n.a.
Mozambique Ethanol 10 1%
Nigeria Biodiesel/Ethanol 2 Ethanol 10 n.a.
South Africa Ethanol 2, Ethanol 10 n.a.
Sudan Ethanol 5 n.a.
Uganda Ethanol 20 n.a.
Zimbabwe Ethanol 10 Ethanol 15, Ethanol 20 n.a.
Zambia Ethanol 10 n.a.
Notes: n.a. = not available. Mandate or target numbers refer to the blending ratios of each type of biofuel.
The distinction between mandate and target is related to the policy framework strictness and the
mechanisms in place to enforce these shares. Enforcement of these mandates and targets vary by country:
with some having announced them but not yet enforced or are not strict. For example, in Zimbabwe, when
ethanol production is low, the E10 mandate is suspended. Potential from agricultural residues refers to the
maximum share of oil use in transport that could be replaced with biofuels from agricultural residues.
Sources: REN21 (2017); BiofuturePlatform (2018); Lane (2019); Sekoai and Yoro (2016); Ministry of Energy
and Petroleum (Kenya) (2014); National Environment Management Authority (Uganda) (2010); Fundira and
Henley (2017) ; UNCTAD (2014).
2.2.3 Productive uses

Much of the industrial production that does exist in Africa relies on the extraction and sale
of natural resources without further transformation into higher value products. This is
reflected in energy use in industry, which is low by international standards. Other

productive activities, in the services and agriculture sectors, contribute higher shares to
GDP in many African economies, with an average of 54% and 19% respectively across
sub-Saharan Africa.
Future GDP growth is largely driven by the industry and services sectors, especially in the
Africa Case. Industry and services value-added in some countries (Ethiopia, Kenya and
Tanzania) in the Africa Case increase almost by an eightfold (Figure 2.11). In global average 2
terms, generating $1 of value added within the industry sector consumes twice as much
energy as $1 of value added from the agriculture sector, and up to eight-times the amount
consumed to produce $1 of value added from the services sector. In sub-Saharan Africa the
situation is different because the agriculture sector is less motorised than anywhere else,
and the services sector includes many small-scale activities with limited contribution to
GDP. This leads to the industry sector in sub-Saharan Africa consuming six-times more
energy to generate $1 of value added than in either the agriculture or services sectors.
Figure 2.11 ⊳ Increase in value added by sector in selected countries in the

Stated Policies Scenario and Africa Case, 2018 to 2040
Angola
Côte d'Ivoire
DR Congo
Ethiopia
Ghana
Kenya
Mozambique
Nigeria
Senegal
Tanzania
South Africa
200% 400% 600% 800%

Growth in STEPS: Agriculture Industry Services
Additional growth in AC: Agriculture Industry Services
Industry and services sectors are major drivers of GDP growth in sub-Saharan Africa in both
projections, while the share of agriculture in GDP drops to 13% in the Africa Case
Note: DR Congo = Democratic Republic of the Congo; STEPS = Stated Policies Scenario; AC = Africa Case.

The agriculture, industry and services sectors are all set to increase their energy demand in
sub-Saharan Africa, with most of the demand growth being driven by light industry and
services. Energy demand across these productive uses increases by 110% in the period to
2040 in the Stated Policies Scenario. In the Africa Case, GDP is more than 50% larger
by 2040 than in the Stated Policies Scenario, but energy consumption for productive
sectors is only 20% larger as a result of efficiency gains. The Africa Case also projects a
different energy consumption mix by 2040 as electricity is increasingly used in the services
sector and for motors in industry, causing electricity consumption to grow 50% faster than
demand for oil and gas together. The share of consumption by sector also varies over time
and by case. By 2040, as more industrial products are produced domestically (cement,
steel, aluminium and in some countries, chemicals), the energy consumed by heavy
industry doubles in the Stated Policies Scenario and triples in the Africa Case.
Figure 2.12 ⊳ Final consumption in productive uses in sub-Saharan Africa

(excluding South Africa) by scenario
Fossil fuels Electricity

120 Final consumption
Mtoe
Agriculture
90 Services
Heavy industry
60 Light industry
Demand changes
30 Higher GDP
Efficiency gains
2018 2040 2040 2018 2040 2040

STEPS AC STEPS AC
Energy efficiency standards and material efficiency temper oil and gas
demand growth by around 25% and electricity by 15% for productive uses
In the Africa Case, around 35 Mtoe of energy consumed by productive uses in sub-Saharan
Africa (excluding South Africa) is avoided thanks to energy efficiency (Figure 2.12). There is
an important opportunity to put in place robust efficiency policies today in anticipation of
expected energy demand growth. In many countries around the world there are now
standards for electric motors used within industry and the use of variable speed drives and
other measures to increase the efficiency of motor systems is becoming increasingly
common. In Africa, some countries have recognised the potential efficiency benefits from
the implementation of MEPS for electric motors, but no countries have yet enforced them.5
5
In Uganda, standards have been developed, but are not yet mandatory. In South Africa, it has been listed as
a planned policy in its post-2015 National Energy Efficiency Strategy. In Egypt, market assessments are
seeking to pave the way for development of standards. In Ghana, planned implementation was announced
in its National Energy Efficiency Action Plan, but not yet implemented.

Efficiency improvements in the Africa Case are not confined to industrial activities: efficient
pumps for irrigation, and efficient appliances and cooling devices also help to reduce the
energy intensity of other sectors compared to the Stated Policies Scenario.
Heavy industry
Currently, Africa’s per capita use of construction material is a small fraction of the global
average, and most of what is consumed is imported (Figure 2.13). However, Africa’s rapid 2
urbanisation presents considerable potential for industrial growth across the continent:
domestic industries have an opportunity to compete effectively to provide the materials
needed to build new cities and expand current ones, and in so doing to underpin wider
industrial development.
Figure 2.13 ⊳ Steel and cement demand per capita in selected sub-Saharan
countries in the Africa Case compared with 2018 levels in India
Cement Steel
2018 India 2018
2018 Ghana 2018
2040 2040
2018 2018
2040 Kenya 2040
2018 Mozambique 2018
2040 2040
2018 2018
2040 Senegal 2040
500 400 300 200 100 30 60 90 120
kg per person kg per person
Domestic production Imports
Industrialisation projects could reduce import shares for
cement and steel products in many African countries
Note: kg = kilogrammes.
Cement production is, by a large margin, the most significant energy-intensive industry in
sub-Saharan Africa. It currently accounts for around 2% of global cement production, and
the growth of cities and infrastructure across the continent provides a significant
opportunity for production to expand. Current production ranges from traditional small-
scale facilities to large-scale projects, notably in West Africa. There are ambitious plans in
Nigeria to further expand cement production facilities such as Unicem. Cement is an
energy-intensive industry, and relies heavily on coal for the clinker/limestone calcination
process, particularly in South Africa, but the share of gas is projected to grow. A cement-
based industrialisation pathway implies a significant increase in energy consumption. In the
Africa Case, energy demand for cement almost quadruples by 2040 and cement production
increases to around 430 Mt per year in sub-Saharan Africa (excluding South Africa).

Box 2.3 ⊳ Potential for hydrogen in Africa
Hydrogen could play a number of important roles in a sustainable energy future,

including clean energy trade and displacing fossil fuel use in industry. Technologies for
the production and use of low-carbon hydrogen are developing and projects around the
world are scaling up. This promises to reduce costs, including the costs for electrolysis,
the process by which water and electricity, including from renewables, can be
converted to hydrogen fuel.
Globally, Africa has some of the highest potential for producing hydrogen from low-cost
renewable electricity, especially from solar power. Production costs in North Africa are
expected to be two-to-three times lower than in most of Europe or Japan. Energy
storage for off-grid and back-up power could be an attractive application for hydrogen
fuel cells; the telecommunications industry is already deploying fuels cells running on
methanol to replace some diesel engines in South Africa, Namibia and other countries.
Today, hydrogen is produced and used at industrial scale in Africa to make ammonia-
based fertilisers and to refine oil. Among the larger suppliers, Algeria, Egypt and Nigeria
use natural gas to produce the vast majority of Africa's hydrogen for ammonia, while
South Africa produces ammonia from coal at a smaller scale (all with accompanying
greenhouse gas emissions). African countries also import considerable amounts of
ammonia and ammonia-based fertilisers produced from fossil fuels without carbon
capture, utilisation and storage. As technology for ammonia production from water
electrolysis gets cheaper and smaller, hydrogen from solar power could help to avoid
greenhouse gas emissions while meeting latent fertiliser demand.
Hydrogen also presents a potential export opportunity, whether as hydrogen itself or in

the form of ammonia or other synthetic fuels. African countries endowed with natural
gas resources and CO2 storage options could also export low-carbon hydrogen
produced using CCUS. A similar logic could apply to goods produced with low-carbon
hydrogen, such as low CO2 intensity steel. The first commercial plants using hydrogen as
an alternative to fossil fuels for steel production are planned for the 2030s, a period
when Africa’s steel capacity is expected to grow. By looking at synergies with local steel
capacity expansions in this timeframe, African countries could be good places to test
this new technology, if governments and financers are supportive.
At present, more than half of steel demand in sub-Saharan Africa is met through imports
but projections indicate expanding domestic steel production to meet local demand with
the share of imports reducing gradually over time. Only a handful of sub-Saharan African
countries currently produce steel, with South Africa accounting for the vast majority of the
regions production. In the Africa Case, primary steel production in sub-Saharan Africa,
excluding South Africa, increases from less than 1 Mt today to almost 20 Mt in 2040,
pushing up energy demand by 12 Mtoe. This increase in production is not sufficient to meet
all growth in domestic demand, and the share of imports remains high. New developments

in the steel sector in Africa include investment in electric steel-making furnaces which
enable scrap reuse. Another possibility, given Africa’s endowment of low-cost renewable
power resources, is the use of hydrogen through renewables-based electrolytic hydrogen
production (Box 2.3). This, however, would require levels of capital investment that do not
appear to be on the horizon for the moment. Overall, less than 1% of global steel is
produced in sub-Saharan Africa and its global market share remains low in both scenarios.
2
Africa is home to one-third of the world’s proven reserves of bauxite, but only a handful of
countries, including South Africa, Mozambique, Cameroon, Ghana and Kenya, process it to
produce aluminium. Together, sub-Saharan Africa (excluding South Africa) countries
produce less than 1% of global aluminium, less than the region’s demand. Aluminium
production is electricity-intensive and plants are often located close to hydropower dams
where cheap and reliable power can be delivered. The Inga Dam projects in DR Congo
raises the prospect of attracting investment in new plants to produce aluminium, but this
would require concurrent efforts to build local expertise. Aluminium production in the
Africa Case increases at a rate that keeps pace with strong domestic demand growth, and
energy consumption for aluminium production nearly quadruples by 2040 as a result.
The chemicals industry in Africa is heavily concentrated in South Africa and Nigeria, and
demand for chemicals and energy inputs into the sub-sector is set to grow through to 2040.
Chemical industries are often linked to the availability of oil and gas infrastructure, due to
the need for petrochemical feedstock. Nigeria and Tanzania are examples of countries
where the emergence and development of upstream resource extraction is attracting
chemical industries, especially for methanol, with production expected to begin in coming
years. By 2040, Gabon, South Africa and Nigeria use hydrocarbons in the fertiliser industry
for large-scale ammonia production in all scenarios. As agriculture continues to account for
an important share of African GDP in 2040, the case for local fertiliser industries is strong,
and production is projected to increase. Clean hydrogen-based ammonia production, as
tested in Morocco, could offer a sustainable way to boost ammonia production.
Light industry, agriculture and services

Light industries such as food processing and manufacturing are often located close to urban
areas with existing electric grid infrastructure. They provide significant employment and are
less energy intensive than heavy industries. The sub-sector is characterised by a strong
degree of electrification and need for low-temperature heat. Security of energy supply is of
paramount importance. If reliable energy supply can be guaranteed, the development of
light industries including manufacturing is an attractive option for many sub-Saharan
African countries. The Africa Case sees the sub-sector growing strongly throughout the
projection horizon, and energy demand follows suit.
The agricultural sector accounts for more than half of employment in sub-Saharan Africa
today. Agricultural productivity per hectare in sub-Saharan Africa is well below that of
other regions, largely due to the limited use of irrigation to raise crop yields and lack of
mechanisation (IEA, 2017). As a result, food production per person has not changed

significantly since 2010. In the Africa Case, energy consumption in agriculture in
sub-Saharan Africa increases threefold: most of the additional demand is for oil and
electricity as the sector becomes increasingly mechanised. Agricultural value added
represents around $830 billion today (18% of total GDP in sub-Saharan Africa). In the
Stated Policies Scenario, it more than doubles, while in the Africa Case it almost triples.
The services sector consumes only a quarter of energy consumed by productive uses in
sub-Saharan Africa today, but generates 55% of GDP. It depends principally on bioenergy
and electricity; planned increases in electricity generation would support growth. Alongside
increased demand for office space and associated cooling demand, new data centres and
information technology infrastructure also propel growth in electricity demand. However, a
shift from relatively informal services activities to high-tech services largely delivered in
offices lowers the use of bioenergy and, as a result, leads to a reduction of the sector’s
energy intensity (measured in terms of energy consumed per unit of value added).
2.3 Clean cooking: the role of cities and higher incomes

While the world has seen considerable progress towards achieving universal access to
electricity in recent years, increasing access to clean cooking facilities remains challenging.
In sub-Saharan Africa, around 900 million people lack access to clean cooking (five-out-of-
six people), accounting for a third of the global total. Almost 95% of them use solid biomass
in the form of fuelwood, charcoal or dung in open fires, while the remainder use kerosene
(especially in Nigeria) or coal (mostly in Southern Africa). At the global level, 80% of those
without access to clean cooking are located in rural areas, and they make up 60% of the
world’s rural population. Less than 15% of the urban population globally lacks access to
clean cooking, thanks to wider access to clean options, such as LPG, and higher average
incomes. In sub-Saharan Africa, the lack of access to clean cooking in cities remains much
higher than in other regions, with just one-third of the urban population having access to
clean cooking solutions, but the problem is much worse in rural areas, where only 6% do.
While fuelwood remains the dominant fuel in rural areas, for many urban households,
charcoal has become the fuel of choice, as distances to sources of fuelwood increase.
The household air pollution resulting from reliance on inefficient and polluting cookstoves
is directly linked to nearly 500 000 premature deaths in sub-Saharan Africa in 2018, and
2.5 million globally – a figure that equals the combined death toll of malaria, tuberculosis
and HIV/AIDS. Despite the size of the gap between the current level of access to clean
cooking and the goal of providing clean, reliable and affordable energy for all by 2030, the
issue is often not given importance commensurate with its impacts. In addition to severe
health effects, the reliance on traditional use of solid biomass for cooking contributes to
forest depletion through unsustainable harvesting of fuelwood, as well as climate change
(see Chapter 5). Moreover, cooking with solid biomass incurs a considerable cost in terms
of time and income: on average, households dedicate 1.4 hours a day to collecting fuel, a
burden borne primarily by women and children (IEA, 2017). The time spent gathering
fuelwood exposes people to various dangers and reduces the time available for educational

or productive ventures. Progress in switching to cleaner cooking fuels has so far been slow,
despite growing awareness of the associated health, environmental and socioeconomic
impacts, as well as decades of programmes targeting access to modern cooking.
In the Stated Policies Scenario, the population lacking access to clean cooking in
sub-Saharan Africa slowly increases from around 900 million to 970 million in 2030 before
declining to 870 million in 2040. The share of the population with access to clean cooking 2
increases from one-third today to 65% in 2040 in urban areas, and from 6% today to
around 40% in 2040 in rural areas. But progress across the continent differs by country
depending on the existence, ambition and implementation of relevant policy frameworks
(Figure 2.14). In this scenario, 80 million people in Nigeria and 70 million people in Ethiopia
are expected to gain access by 2040. On the other hand, in several countries population
growth outpaces the number of additional people gaining access. In DR Congo, the number
of people without access to clean cooking facilities almost doubles to 150 million by 2040.
Figure 2.14 ⊳ Access to clean cooking in selected sub-Saharan Africa

countries in the Stated Policies Scenario, 2018 and 2040
Angola 2018
Côte d'Ivoire
DR Congo 2040
Ethiopia STEPS
Ghana
Kenya
Mozambique
Nigeria
Senegal
Tanzania
South Africa
20% 40% 60% 80% 100%
Progress towards universal clean cooking access is slow, with just under half of the
sub-Saharan African population remaining without access in 2040
Note: STEPS = Stated Policies Scenario.

In the Africa Case, full access to clean cooking by 2030, in line with SDG 7, means that more
than 1.1 billion people in sub-Saharan Africa move away from the traditional use of solid
biomass by 2030. Improvements in both scenarios have important impacts on household
air pollution. In the Stated Policies Scenario, premature deaths related to household air
pollution increase in the short term before declining to 2% below today’s level by 2040,
while in the Africa Case, the number of premature deaths linked to household air pollution
falls by two-thirds.

2.3.1 Increasing access to clean cooking options
Future trajectories among the many countries in sub-Saharan Africa are very diverse and
largely dependent upon policy choices and domestic circumstances. For example, 30% of
urban households in Nigeria today rely on kerosene as a cooking fuel, but this is reduced
through the increased uptake of LPG and gas in the Stated Policies Scenario, and
completely replaced in the Africa Case by 2030 (Figure 2.15). Progress in Nigeria is
facilitated by the National Cookstove Programme which provides funding for the
distribution of clean cookstoves and encourages state and non-state actors to build on the
national scheme via a market-based approach. In Côte d’Ivoire, the national plan seeks to
increase efficiency of charcoal production and promote LPG use. In Ethiopia, recent gains in
electricity access are expected to continue and result in 50% of urban households cooking
with electricity in the Stated Policies Scenario (and 80% in the Africa Case in 2040),
compared with 32% today. Examples of regional level frameworks to expand clean cooking
access include the West Africa Clean Cooking Alliance which aims to disseminate clean,
efficient and affordable cooking fuels and devices to all Economic Community of West
African States citizens by 2030.
Households seeking to switch to cleaner cooking solutions, such as LPG, ethanol, natural
gas, electricity and improved cookstoves, face economic and non-economic barriers.
Evidence has shown that fuel and technology choices do not follow an energy ladder;
higher incomes do not necessarily result in households switching from the traditional use of
solid biomass to clean cooking options. Instead, a phenomenon called “fuel stacking” is
increasingly prevalent in Africa, with many households using a number of different cooking
solutions depending on needs and economic circumstances. The relatively high price of the
technologies (and the lack of adequate and accessible financing) is an important
impediment to the dissemination of clean cooking options. Even with declining prices for
clean cooking technologies, and financing through loans and microcredit, millions of poor
rural and urban households may not be able to afford the cost of these technologies. The
variability of the fuel price is another barrier that impedes households considering
switching to other options or prevents them from fully relying on cleaner cooking options.
Cultural habits, traditional cooking practices, low levels of empowerment of women and
lack of awareness of the health, social, economic and environmental benefits of using
cleaner options also remain persistent obstacles to widespread diffusion of clean cooking
technologies to poor households. For example, wood smoke can be regarded as beneficial
for avoiding bad odours, for the taste of food, or for repelling insects, exemplifying the
importance of cultural habits. Health education has an important part to play in this
context.
In terms of accessing clean cooking technologies, women may be disadvantaged by the fact
that men often make purchasing decisions within the household. This can result in
decisions to purchase or finance technologies such as solar lighting systems that are
perceived as beneficial for the entire family rather than technologies such as clean

cookstoves that can be perceived as having more limited benefits. Understanding how
intra-household gender hierarchies influence technology acquisition is crucial for designing
responses to address them. Simple design adaptations such as adding cell phone chargers
to cook stoves rather than solar lanterns can sometimes give a competitive advantage to
technologies that women tend to use more often than men.
Figure 2.15 ⊳ Primary fuels used for cooking in selected sub-Saharan countries 2
in the Stated Policies Scenario and Africa Case, 2018 and 2040
Urban Rural
2018
d'Ivoire
Côte
2040 STEPS
2040 AC
2018
Congo
2040 STEPS
DR
2040 AC
Ethiopia
2018
2040 STEPS
2040 AC
2018
Kenya
2040 STEPS
2040 AC
Mozam-
2018
bique
2040 STEPS
2040 AC
2018
Nigeria
2040 STEPS
2040 AC
2018
Tanzania Senegal
2040 STEPS
2040 AC
2018
2040 STEPS
2040 AC
50% 100% 50% 100%

Fuelwood, straw and waste ICS fuelwood Charcoal ICS charcoal
Coal Kerosene LPG and natural gas Electricity and other
Displacing the traditional use of fuelwood and charcoal involves multiple solutions,
depending on the availability and affordability of cleaner options
Note: STEPS = Stated Policies Scenario; AC = Africa Case; DR Congo = Democratic Republic of the Congo;
ICS = improved cookstoves; LPG = liquid petroleum gas.


In urban areas in particular, the large-scale uptake of LPG, electricity, ethanol and gas in the
Stated Policies Scenario enables a switch away from the use of inefficient and polluting
stoves, and fuels such as lignite and kerosene. Charcoal continues to play a key role in
urban areas due to its light weight, low price and high energy content compared to
fuelwood (30 megajoules per kilogramme [MJ/kg] for charcoal compared to around
16 MJ/kg for fuelwood). In rural areas, reliance on fuelwood, straw and waste is set to
remain relatively high, although they are increasingly burned in more efficient and
improved cookstoves. Continued reliance on bioenergy in rural areas is often compounded
by lack of infrastructure to supply clean cooking fuels like LPG, and by fragile supply chains.
Cooking practices are very context-specific. There is no one-size-fits-all option and each
clean cooking solution comes with its disadvantages. Cooking with LPG on easy to connect
burners offers clean indoor air as well as a very comfortable user experience. Meals can be
cooked or reheated quickly with no difficulty in igniting or maintaining the burning flame.
However, LPG can raise problems of affordability, given the high upfront cost for the
burners and hoses, initial deposit for a cylinder, plus the gas content of the cylinder (users
might also need to save money to be able to pay upfront to refill their cylinder). Although
LPG is relatively safe compared to kerosene or biomass, illegal and unsafe refilling of the
pressurised cylinders does carry dangers. Some innovative pay-as-you-go enterprises aim to
tackle these challenges by supplying LPG bottles to customers that are equipped with smart
meters and release small quantities of gas instantaneously when payment is received via
mobile money services. Other innovative service models are also gaining traction: for
example some companies are piloting the distribution of biomass pellets or briquettes, with
sale costs designed to cover the cost of a subsidised or loaned gasifier stove (see Chapter 1,
section 1.2.1 for more on innovative bioethanol solutions). Several biogas programmes
offer support at a bigger scale, for example by providing village-scale biodigester
installations including training and assistance to the community.
The economic and social barriers to the use of charcoal are much lower than for most other
fuels. Using charcoal for cooking and heating comes at a lower upfront cost than using
electricity, biogas or natural gas, all of which require the development of capital-intensive,
durable infrastructure for fuel supply. The limited capacity for a typical solar panel to
produce enough electricity for cooking may also weigh in favour of using solid biomass, as
may the ability to continue traditional cooking practices with charcoal. All of the above are
factors in the attractiveness of charcoal relative to alternative fuels, driving growth in its
demand. Burning charcoal in improved cookstoves however can significantly reduce air
pollutant emissions and fuel requirements. In the Stated Policies Scenario more than 10%
of households still cook with charcoal by 2040 in sub-Saharan Africa (excluding South
Africa), but 15% of them do so with improved cookstoves: this increases to 100% in the
Africa Case.
Over recent years, several international organisations and initiatives have promoted access
to clean cooking, including Sustainable Energy for All and the Clean Cooking Alliance, both
of which have been instrumental in researching, building evidence and raising the profile of

issues linked to lack of access to clean cooking. Acknowledging that progress has been slow,
despite all efforts, the international community is seeking to create a renewed and stronger
momentum for tackling the lack of access to clean cooking. To accelerate progress towards
universal access, several international development organisations are calling for joint
efforts from the energy and the health communities, on the basis that addressing the lack
of clean cooking solutions and its consequent indoor air pollution should be a key priority
for both. Combining strategies and actions to reach the SDG 7 on energy and SDG 3 on 2
health will require more policy attention as well as more funding to support technology and
business model innovation.
In 2017 only $2 million of equity were invested in companies in the clean cooking sector, a
mere 0.1% of what is estimated to be necessary to bring clean cooking solutions to scale
(ACUMEN, 2018). Private sector involvement in clean cooking remains highly fragmented,
not least because a majority of clean cooking companies are small scale and face difficulties
in accessing adequate funding (Clean Cooking Alliance, 2019). The recently launched Clean
Cooking Fund, backed by the World Bank, aims to help address these problems by
providing result-based finance, grants and technical assistance to organisations that offer
innovative solutions to accelerating deployment of clean cooking solutions.
2.3.2 Rapid urbanisation requires better use of charcoal

More than 750 million cubic metres of wood was harvested on the African continent in
2017, accounting for roughly 20% of the global total. The share of harvested wood used for
energy is around 90% in Africa, considerably higher than the global average of around 50%
(FAO, 2017). With Africa producing over 60% of the world’s charcoal, much of this wood is
converted to charcoal to enhance its calorific value and make it easier to transport to urban
areas (FAO, 2017). Charcoal use across sub-Saharan Africa (excluding South Africa) is
thriving, with demand growing at an annual average rate of around 4% since the year 2000.
The use of charcoal is rising most rapidly in urban areas where population growth and the
often unsustainable use of forest resources limits the availability of fuelwood (Figure 2.16).
As a source of income and employment creation along the value chain (for production,
transportation, sales and distribution), charcoal manufacturing and trade have shaped
patterns of economic development in many areas.
As urbanisation increases across Africa, the growing demand for both land and charcoal is
likely to put additional pressure on traditional forest management and extraction practices.
While sustainable land and biomass use is part of the climate mitigation strategy of most
African countries, few countries include commitments on charcoal production or use in
their Nationally Determined Contributions pledged under the Paris Agreement. Some
countries, for example Kenya, however have decided to ban the use of charcoal to reduce
stress on forests. Given the importance of charcoal use for cooking in sub-Saharan Africa
(excluding South Africa), and the implications of its use, improving the sustainability of the
charcoal value chain could bring significant benefits.

In the Stated Policies Scenario, charcoal consumption per capita continues to increase over
time, with overall charcoal consumption in sub-Saharan Africa (excluding South Africa)
increasing by 50% by 2040 compared to today’s level. By contrast, the increasing number of
improved cookstoves in the Africa Case along with other clean cooking options allows for a
reduction in charcoal consumption in sub-Saharan Africa by over 25%. With urbanisation
rates increasing to 51% in 2040, reducing total charcoal use requires dramatic changes in
consumption patterns to decouple urban migration and increased charcoal use.
Addressing the inefficiencies of charcoal stoves is a first step towards reducing demand for
charcoal, and would also reduce indoor air pollution. Twenty-three countries in sub-
Saharan Africa have already committed to promote efficient or improved cookstoves as
part of their updated Nationally Determined Contributions. Further opportunities exist to
improve the upstream efficiency of charcoal production and reduce related greenhouse gas
emissions (Box 2.4).
Figure 2.16 ⊳ Charcoal consumption per capita and urbanisation rates in

Scenario and Africa Case
120
Total charcoal
kg per capita
100
consumption
STEPS
STEPS 2040 10 Mt
80 2030
2018
60
AC
AC 2040
40 2005
2030
20
1990
25% 30% 35% 40% 45% 50% 55%

Urbanisation rate
Close ties between urbanisation and charcoal use are loosened in the Africa Case,
reducing total charcoal consumption and subsequent pressure on forest resources
Notes: STEPS = Stated Policies Scenario; AC = Africa Case.
It is unlikely to be possible to achieve a sustainable charcoal value chain and access to

affordable, efficient cook stoves for end-users without changes in policies and regulations.
A comprehensive policy framework could lead to a number of benefits including improved
efficiency of charcoal production, reduced stress on forest resources and improved health
outcomes. The costs involved in promoting efficient stoves and kilns, and improving forest
management would need to be set against wider financial and societal benefits, not least in
advancing progress towards multiple sustainable development goals.

Box 2.4 ⊳ Can charcoal production be made more efficient?
Charcoal manufacturing, transportation and distribution are responsible for two-thirds

of the efficiency losses in the overall charcoal value chain: the other third comes from
the energy performance of stoves. There is sizeable potential to reduce upstream
efficiency losses: conventional production practices rely on earth-mound kilns that
operate at 8-20% efficiency, but more efficient kilns can reach efficiency levels of at 2
35-40%. There is similarly sizeable potential to improve the efficiency of stoves: energy-
efficient charcoal equipment for cooking can achieve a thermal efficiency of 30-40%,
compared with 10-20% for most traditional cookstoves. Shifting to efficient stoves for
both fuelwood and charcoal burning in the Africa Case would cut biomass consumption
for cooking in sub-Saharan Africa (excluding South Africa) by 60% by 2040, and would
reduce charcoal consumption for cooking by 35%. These types of gains are instrumental
in achieving the reductions in wood demand for charcoal production in the Africa Case
(Figure 2.17).
Figure 2.17 ⊳ Wood demand for charcoal production in the Stated Policies
Scenario and Africa Case
250
Fuel
Mt
switching
200
Kiln
efficiency
150
Stove
efficiency
100
50
2018 2040 2040

Stated Policies Africa Case
Wood use for charcoal production is cut by two-thirds in 2040 in the Africa Case
with more efficient kilns and stoves accounting for one-third of the gains
Putting a price on wood resources and reinvesting revenues (for example from wood
cutting taxation, licensing fees, certifications) to help ensure sustainable forest
management and wider use of efficient stoves is a key step in improving the
sustainability of the charcoal value chain (FAO, 2017). The diversification of bio-based
fuels (using agricultural waste and wood residues) would also reduce the need for wood
extraction from forests, and consequently the time spent by women and children in
gathering wood and cooking.

2.3.3 Rural areas – how to unleash the potential of biogas?
Rural areas face a unique array of challenges in transitioning towards clean cooking, with
the lack of availability of modern fuels being one of the principal barriers to change. LPG is
not always available due to long distances and poor transport links between distribution
centres and households, and to demand competition from urban areas. A move to electric
cooking is impeded by very low rates of electricity access in rural areas in Africa, the
unreliability of electricity supply in many places where it does exist, and the prioritisation of
electricity for uses such as lighting and appliances. Other modern fuels such as ethanol and
processed biomass pellets or briquettes often face similar barriers to access.
Biogas provides an alternative clean cooking solution that is ideally suited to many rural
areas and can also be used as a local source of clean energy for heating. A mixture of
methane and carbon dioxide (CO2), biogas can be produced from organic by-products and
waste otherwise thrown away or abandoned. Biogas is ideally suited to communities where
agricultural residues and animal manure are available as a feedstock. In addition to
providing a source of clean energy, anaerobic digestion produces as a by-product a valuable
fertiliser that can enhance agricultural production.
Based on our new bottom-up assessment, we estimate that today in Africa there is
sustainable technical potential available to produce around 50 Mtoe of biogas. The
potential doubles by 2040 to almost 100 Mtoe at an average cost of just over $10 per
million British thermal units (MBtu), which would represent around one-third of the
projected natural gas demand in the region in the Stated Policies Scenario. About 80% of
this potential is in sub-Saharan Africa (Figure 2.18).
Figure 2.18 ⊳ Cost curve of potential biogas supply by feedstock in Africa, 2040
30
Dollars per MBtu
Crops*
Animal
20 manure
Municipal
solid waste
10 Wastewater
0 10 20 30 40 50 60 70 80 90
Mtoe
By 2040, over 90 Mtoe of biogas could be produced in Africa,
around half of which would cost less than $10/MBtu
* Includes crop residues only, energy crops are excluded given concerns about their sustainability.
Note: MBtu = million British thermal units.

The biggest contribution to the potential comes from rural areas with strong agricultural
sectors. Crop residues, especially cereals, account for almost 60% of the total potential,
animal manure for close to 25%, and municipal solid waste (MSW) for most of the
remainder. At the end of the outlook period, the picture changes slightly as further
urbanisation increases the availability of MSW and as anticipated changes in diet bring an
increase of livestock and therefore of animal manure.
2
The main route to biogas production (over 80% of our estimated 2040 potential) is via a
biodigester, an airtight system where anaerobic digestion occurs and biogas is produced.
These can be either decentralised (household-scale) or centralised. A decentralised
biodigester has a basic design and is built to provide enough biogas to fulfil the energy
needs for cooking and water heating of a single family. It produces biogas at an average
cost of $6/MBtu, with variations depending on the capital cost of the biodigester installed.
Centralised biodigesters can be of small, medium or large scale and the feedstock is usually
provided from a single farm or a group of farmers with the involvement of local
entrepreneurs. In this case costs are higher – in the range of $12-20/MBtu – with limited
economies of scale and additional labour and feedstock costs.
A clear picture of today’s consumption of biogas in Africa is not available due to lack of
data. We estimate that current biogas use is around 5 000 tonnes of oil equivalent (toe)
(6 million cubic metres of natural gas equivalent), and its use is concentrated in countries
with specific support programmes for this fuel. Some governments, such as Benin, Burkina
Faso and Ethiopia, provide subsidies that can cover from half to all of the investment, while
numerous projects promoted by non-governmental organisations provide practical know-
how and subsidies to lower the net investment cost. In addition to these subsidies, credit
facilities have made progress in a few countries. A new lease-to-own6 (LtO) arrangement
has recently been developed by a limited number of companies in Kenya, and around 45%
of the households in Kenya that installed a digester in 2018 financed their unit through an
LtO arrangement (ter Heegde, 2019).
Research in East Africa shows that families with access to biogas see benefits in terms of
ease of cooking and a reduction in the time spent collecting fuelwood, as well as a lower
incidence of health and respiratory problems. There are also co-benefits in terms of
agricultural productivity (as a result of using the bio-slurry as fertiliser) and reducing
deforestation (Clemens et al., 2018).
In the Stated Policies Scenario, consumption rises to over 3 Mtoe of biogas in Africa by
2040. However, there is much larger uptake of biogas in the Africa Case, spurred by the
drive in this scenario to provide universal access to clean cooking by 2030. Biogas demand
rises to 9 Mtoe in 2040, over half of which is used for providing access to clean cooking in
sub-Saharan Africa, the remainder is used for power generation. An additional 2 Mtoe is
used for biomethane production in South Africa. In this scenario, over 135 million people in
Africa use biogas to move away from reliance on traditional use of solid biomass.
6
Lease-to-own credit mechanism allows the user to purchase the biodigester when the lease period expires.

The main economic challenge is the relatively high upfront cost of the biodigester. In Africa,
upfront costs for an average sized household biodigester with a technical lifetime of over
20 years can range between $500-800 (ter Heegde, 2019). A part of the capital cost can be
reduced by using traditional and locally available construction materials such as sand and
gravel, and by relying on local labour. For the remainder, financing help is often needed.
There are also significant non-economic barriers, notably biodigester maintenance and
availability of gathered feedstock. These barriers can be even more pronounced for a
biodigester at the community scale or larger. In a survey in East Africa, more than a quarter
of biodigesters installed between 2009 and 2013 were out of operation by 2016 because of
a lack of readily available maintenance expertise (Clemens et al., 2018). Feeding a
household biodigester regularly with animal manure requires at least two mature cattle, so
any deterioration in household circumstances quickly affects biogas production, while local
communities need to develop and maintain a system to collect waste and residues for
centralised biodigesters. Local entrepreneurs and government partnerships with the
private sector have a crucial role to play in overcoming these barriers, with governments
promoting biogas utilisation through a range of programmes and facilities while the private
sector ensures a proper and sustainable development of the sector along all the supply
chain.

Chapter 3
Access to electricity and reliable power

Generating a brighter future for Africa
S U M M A R Y
• Today, 600 million people in sub-Saharan Africa (one-out-of-two people) do not
have access to electricity, according to our latest country-by-country assessment.
A number of countries make important headway in the Stated Policies Scenario,
with South Africa, Ethiopia, Ghana, Kenya, Rwanda and Senegal reaching full access
by 2030. This allows around 20 million people to gain access every year. Yet progress
is uneven: 530 million people (one-out-of-three people) remain without electricity in
2030. Annual gains in access would need to triple to reach universal access by 2030.
• South Africa differs from its sub-Saharan African peers with its mature economy,
successful access programmes and integrated policy making. Competitive auctions
for renewables are stimulating private investment. The financial health of the state-
owned utility remains vulnerable, strengthening its commercial and operational
performance is essential to the future well-being of the power sector.
Figure 3.1 ⊳ Electricity demand and generation in sub-Saharan Africa
(excluding South Africa) by scenario, 2018 and 2040
Electricity demand Non-household

Transport
2018 Productive uses
2040 STEPS Household
With access in 2018
2040 AC Gaining access
Electricity generation Sources

Coal
2018 Gas
Oil
2040 STEPS Hydro
2040 AC Wind
Solar PV
Geothermal
500 1 000 1 500 2 000
Other renewables
TWh
Demand quadruples by 2040 in the Stated Policies Scenario and increases almost
eightfold in the Africa Case, renewables and gas rise to meet demand growth
• Electricity demand in the rest of sub-Saharan Africa is set to quadruple by 2040,

driven by rising incomes and industrialisation. However, per capita demand remains
low, at less than 15% of today’s global average. Accelerated economic development
and universal access to electricity in the Africa Case push demand to almost
1 500 terawatt-hours (TWh) by 2040, with households in urban areas approaching
the ownership and consumption levels of middle-income countries.
Chapter 3 | Access to electricity and reliable power 113

• Keeping pace with soaring needs, electricity supply in the rest of sub-Saharan Africa
increases fourfold in the Stated Policies Scenario. Generation capacity triples to
270 gigawatts (GW) by 2040, but this is far short of the 600 GW reached in the Africa
Case. The expansion is achieved through a combination of renewables and natural
gas. Solar photovoltaics (PV) plays a key role in delivering access and becomes the
largest source in terms of installed capacity in the mid-2030s in the Stated Policies
Scenario, and in the mid-2020’s in the Africa Case, overtaking hydropower.
• While hydropower generation grows in both scenarios, new detailed analysis on its
vulnerability to climate change shows increased variability of outputs and the need
to plan for long-term resilience with a diverse power mix and regional co-operation.
• The expansion of generation capacity is not sufficient to provide reliable and
affordable electricity. Around 80% of sub-Saharan African businesses recently
suffered from electricity disruptions, leading to average annual losses of around
8% of sales. Sustaining economic growth of 7.3% per year in the Africa Case requires
continuous focus on transmission and distribution assets to reduce the incidence of
power outages by over three-quarters and take network losses to below 10% (from
18% today) improving economic outcomes for companies, including power utilities.
• Focus on improved network management, densification and extensions see the grid
provide about 70% of the 230 million new connections expected by 2030 in the
Stated Policies Scenario. In the Africa Case, mini-grids and stand-alone systems,
mostly based on renewables, are essential to bridge the gap to achieve universal
access; they are the least-cost solutions for over two-thirds of the additional people
that attain access, connecting almost 450 million people by 2030 in the Africa Case.
• Investment in the power sector in sub-Saharan Africa averages more than $45 billion
per year over the outlook period in the Stated Policies Scenario (compared to
$21 billion today). The Africa Case requires a fivefold increase to ensure reliable and
affordable power for all (over $100 billion per year). In both scenarios, half of the
total investment goes to expansion, reinforcement and maintenance of grids,
increasingly for mini-grids and cross-border infrastructure. Investment in low-carbon
generation accelerates, driven by a rise in spending on solar PV projects, which
reaches almost $25 billion per year on average in the Africa Case.
• Most power sector investment in Africa today is underpinned by public funds, with
heavy reliance on international development finance. Given the financial constraints
of utilities and limited fiscal capacity of governments, private sources of finance will
be essential to bridge investment gaps. Policy and regulatory improvements are
needed to address investment risks, facilitate a more effective use of public funds
and help reduce the cost of capital. Four areas are crucial to foster a more self-
sustaining environment for investment: better financial performance of utilities;

improvements in procurement frameworks; more sustainable business models for
the decentralised sector; and strengthened provision of long-term finance.

3.1 Introduction
The achievement of universal access to reliable electricity is vital if Africa is to thrive, and
that means providing access for the first time to the 600 million people currently deprived
of electricity, electrifying schools and hospitals, and ensuring that electricity is available for
companies and entrepreneurs. China and India faced similar challenges and it took them
35 and 16 years respectively to reach a 95% access level and to connect as many people as
now need to be connected in sub-Saharan Africa (Figure 3.2). More decentralised and
modular technologies are now available and they are reducing the length of time it takes to
provide access and the costs of doing so. 3
The regional and country-by-country projections for the Stated Policies Scenario and the
Africa Case are described in this chapter. We analyse the electricity demand and supply
outlook and their drivers, the changing electricity generation mix by technology and access
solution, and the implications for affordability, reliability and investment needs.
Figure 3.2 ⊳ Reaching universal access to electricity in sub-Saharan Africa

compared with achievements in China and India
Historical Projections
Population without access (million people)
600
Sub-Saharan Africa
2018-30
500
400
India
2002-18
300
China
1965-2000
200
100
1970 1980 1990 2000 2010 2018 2030
Achieving access for all in sub-Saharan Africa in only twelve years

will require an unprecedented effort
An increasing number of countries are implementing policies with a view to meet the
United Nations Sustainable Development Goal 71 by 2030, resulting in substantial progress
in the Stated Policies Scenario. New technologies and business models are attracting
investment from donors, development banks and increasingly the private sector.
Nonetheless, without a significant step up in efforts, the population without access to
electricity will remain as high as 530 million in 2030 in sub-Saharan Africa.
1
Sustainable Development Goal 7: Ensure access to affordable, reliable, sustainable and modern energy
for all.

In the Africa Case, we examine by country, and for sub-Saharan Africa as a whole, the range
of technologies, policies and investment frameworks needed to achieve the universal
electricity access target. Our least-cost analysis points to the best way forward as being
comprehensive policies that make use of all solutions, centralised and decentralised, with
mini-grids and stand-alone systems providing power to more than half of the population
gaining access by 2030.
We go beyond looking at the achievement of universal access and also examine what it
would take to develop a reliable, affordable and sustainable power system capable of
making the African Union’s Agenda 2063 a reality (see Part B introduction, Box B.2).
Reliable electricity is an essential element of a thriving economy, and Africa has the
opportunity to be the first continent to industrialise and build resilient and reliable power
systems based on cleaner sources, with a combination of readily available renewables and
natural gas now looking like the most competitive way to provide electricity.
3.2 Outlook for electricity access

While more than 99% of the population in North Africa has access to electricity, the
situation is very different in the rest of the continent. In the Stated Policies Scenario, the
number of people without access to electricity across sub-Saharan Africa declines slightly to
530 million by 2030, but increases after that to 600 million as rapid population growth
outruns efforts to increase access (Figure 3.3). Many countries on the continent are putting
in place policies which, if effectively implemented, will allow around 20 million people to
gain access to electricity each year by 2030, a rate similar to what the region has witnessed
since 2013 (see Chapter 1).2 However, the rate is less than a third of what would be needed
to reach full access by 2030. The share of the population with access to electricity in sub-
Saharan Africa rises from 45% today to nearly 65% in 2030 in the Stated Policies Scenario,
with over 230 million people gaining access.
Projected progress in the Stated Policies Scenario is most rapid in East Africa, as it moves
from a regional access rate of 43% today to more than 70% by 2030. Kenya, Ethiopia and
Rwanda are all set to achieve universal access before 2030 (Table 3.1). Ethiopia brings
access to the highest number of people in the region by 2030 (more than 70 million).
Tanzania also sees rapid progress, with its electrification rate climbing to around 70% in
2030 from less than 40% in 2018. Progress is also made in West Africa and Southern Africa,
where the regional access rates reach over 60% by 2030. South Africa and Ghana, which
achieved two of the highest access rates on the continent in 2018 after two decades of
effective government leadership, are expected to reach full electrification by 2030. Senegal
is expected to achieve universal access in 2025. Strong efforts in Nigeria and Côte d’Ivoire
result in their rates of access increasing to 80% and more than 90% respectively by 2030.
Countries across Central Africa see limited progress under the Stated Policies Scenario, but
there are some bright spots: Gabon and Cameroon both reach more than 90% by 2030.
2
The investment and financing implications are discussed in sections 3.7 to 3.8.

Figure 3.3 ⊳ Electricity access progress in sub-Saharan Africa in the Stated
Policies Scenario
Population Access rate

1 250 100% Senegal
Million people
Kenya Ethiopia
1 000 80%
Other West
Southern
750 60%
500 40% Other East

Central 3
250 20%
Rwanda
2018 2030 2040 2000 2010 2018 2030 2040

With access West Africa Southern Africa
Without access Central Africa East Africa
Strong policy support is instrumental to drive the rapid increase in access rates observed in
several countries, but many struggle to provide access to increasing populations
Table 3.1 ⊳ Electricity access policies and targets in selected countries
Country Target Implementation measures
Kenya Full access Kenya National Electrification Strategy (2018): investment of $2.8 billion
by 2022 from 2018-22. Kenya Off-grid Solar Access Project: distribute 250 000
solar home systems to power households, schools, health facilities and
agriculture by 2030.
Ethiopia Full access Electrification Program (2017): geospatial least-cost roll-out plans, fast-
by 2025 paced extension of the grid to reach 65% of the population with the grid
and 35% with decentralised systems by 2025; public-private off-grid
programme for 6 million households.
Rwanda Full access Energy Sector Strategic Plan and Rural Electrification Strategy: connect
by 2024 52% households to the grid and 48% to decentralised systems by 2024;
connect all productive users; cut by half the duration and number of
interruptions; introduction of appliance efficiency standards.
Senegal Full access National Rural Electrification Program (PNER), aiming to electrify 95% of
by 2025 rural clients through grid extension, 4% through solar only or solar-diesel
hybrid mini-grids, and the rest through solar home systems.
Côte d'Ivoire Connect all Programme Electricité pour Tous: electrify 1 million households.
areas by Programme National d’Electrification Rurale: connect all towns above
2025 500 inhabitants by 2020, and all areas by 2025. Tariff reductions for poor
households.

Despite this impressive projected progress in a number of countries, around 20 countries,
accounting for 30% of the population of sub-Saharan Africa in 2030, still have less than half
of their population with access to electricity in 2030 on the basis of current and stated
policies. Across sub-Saharan Africa, 36% of the population have no access to electricity in
2030, of which three-quarters, or more than 400 million people, live in rural areas.
Achieving full access by 2030 would require tripling the current rate of annual connections
to reach over 60 million people on average each year. This would mean finding ways to
connect people living “under the grid” but lacking access (see Spotlight in Chapter 1,
section 1.2.2). It would also mean accelerating the deployment of mini-grids and stand-
alone systems, which are the least-cost way to provide power to more than half of the
population gaining access by 2030 (see section 3.4.2). In 2030, around 50% of the
population without access in the Stated Policies Scenario live in the Democratic Republic of
the Congo (DR Congo), Nigeria, Uganda, Niger, and Sudan: scaling up efforts in these
countries is particularly important.
Delivering access to electricity in an integrated way would support economic growth and
overall development. Access could bring new sources of productive employment to remote
populations, in particular for women. Less time to complete domestic chores provides
more time for paid jobs. Access to electricity also benefits women-owned businesses,
helping women to move from extreme poverty to near middle-class status, as shown
within areas connected by a mini-grid company in Ghana (Power Africa, 2019). A recent
study shows that the decentralised renewables sector is beginning to support employment
at a similar scale to the traditional utility sector, with strong potential for future growth
(Power for All, 2019).
3.3 Outlook for electricity demand

Electricity demand3 in Africa today is 700 terawatt-hours (TWh), with South Africa and the
North African countries accounting for over 500 TWh of this total. Yet it is the sub-Saharan
Africa countries (excluding South Africa) that see the fastest growth in electricity demand in
the Stated Policies Scenario, with demand increasing at an average annual rate of 6.5%, the
highest rate of any region worldwide. By 2040, electricity demand in sub-Saharan Africa,
excluding South Africa, reaches 770 TWh under current and stated policies, four-times
today’s level. Electricity demand per capita increases from an average of 185 kilowatt-hours
(kWh) today to over 430 kWh in 2040, but still represents less than 15% of today’s global
average of over 3 000 kWh.
Low per capita electricity demand masks large inequalities that seem likely to persist.
About 440 million people across sub-Saharan Africa (excluding South Africa) live in
households that have access to electricity today, predominantly in urban areas. In the
Stated Policies Scenario, households with access today and new ones in areas with existing
3
Electricity demand is defined as total gross electricity generated less own use generation, plus net trade
(imports less exports), less transmission and distribution losses.

access to electricity consume an additional 220 TWh by 2040. This compares to an increase
of only 70 TWh in order to provide access to electricity for the first time to 320 million
people in this scenario. Growth in electricity demand from an emerging middle-class and
newly connected households goes hand-in-hand with growth in demand from the
productive sectors of the economies (Figure 3.4). Demand from industry and the services
sectors more than triples to 390 TWh by 2040 in the Stated Policies Scenario, fuelled by
domestic consumption and economic growth. Electricity demand from agriculture increases
by 150%, but still accounts for only 6 TWh in 2040.
Figure 3.4 ⊳ Electricity demand by scenario in sub-Saharan Africa 3

(excluding South Africa)

2 000
TWh
Efficiency savings
1 500 Household
Gaining access
With access in 2018
1 000
Non-household
Productive uses
500
Transport
2018 2030 2040 2030 2040
Demand quadruples by 2040 in the Stated Policies Scenario and increases almost
eightfold in the Africa Case. Demand would be even higher without efficiency savings.
The Africa Case sees national strategic plans and the Agenda 2063 ambitions realised in full,
with important implications for electricity demand. A virtuous cycle emerges in which
electricity demand growth is fuelled by the development of local industries and services,
increasing employment and incomes, and this in turn increases the consumption of locally
produced goods and services. Electricity demand in the Africa Case grows at close to
10% per year to reach almost 1 500 TWh in 2040. Extension of electricity access to all
households in the Africa Case adds 260 TWh of demand relative to the Stated Policies
Scenario by 2040. Nonetheless, achieving universal electricity access still accounts for only
a quarter of demand growth to 2040.
The electricity demand growth rate in sub-Saharan Africa (excluding South Africa) would
reach 11% per year in the Africa Case without efficiency improvements in appliances and
equipment. Energy efficiency measures are essential to achieve the vision of the Africa
Case, helping to improve the competitiveness of local industries and reduce the impact of
increases in energy services on electricity bills (see section 3.6). A handful of countries

in sub-Saharan Africa are already leaders in energy efficiency when it comes to the
residential appliances that accompany decentralised models of electricity access. Extending
innovations of this kind to the wider appliance market is central to the savings achieved in
the Africa Case.
3.3.1 Electricity demand growth by sector

The residential sector is the largest contributor to electricity demand growth, accounting
for some 50% of the growth to 2040 in sub-Saharan Africa (excluding South Africa) in both
the Stated Policies Scenario and Africa Case (Figure 3.5). As income levels increase across
Africa, households increasingly own appliances such as refrigerators, washing machines and
phones: the wealthier ones also own cooling devices. Domestic appliances are the biggest
contributor to growth in residential electricity demand in the Stated Policies Scenario,
adding 175 TWh to demand by 2040. Space cooling adds another 40 TWh, with the number
of air conditioners across the region expected to increase almost sixfold to about 45 million
by 2040. In the Africa Case, universal access to electricity is achieved by 2030 and
household incomes rise more rapidly. As a result, residential electricity demand is 370 TWh
higher in 2040 relative to the Stated Policies Scenario, with the increase equally split
between rural and urban areas.
Figure 3.5 ⊳ Residential electricity demand and household appliance

ownership by scenario in sub-Saharan Africa
(excluding South Africa)
Electricity demand, 2040 Household appliance ownership

1 200 1.2
Units per household
Rural Urban
TWh
Television
0.9
900
Refrigerator
0.6
Efficiency
600 Washing
gains
machine
0.3
Air
300 conditioning
Access and
wealth
2018
2018
STEPS
STEPS
AC
AC
STEPS AC 2040 2040
In the Africa Case, an increase in residential demand stemming from better access to
electricity and increased ownership of appliances is partially offset by efficiency gains
Notes: STEPS = Stated Policies Scenario; AC = Africa Case. Access and wealth refers to the increase in
demand associated with higher electricity access and higher average household incomes in the Africa Case
relative to the Stated Policies Scenario. Efficiency gains refers to the reduction in electricity demand due to
efficiency gains in the Africa Case relative to the Stated Policies Scenario.

By 2040, the urban population in sub-Saharan Africa (excluding South Africa) more than
doubles to over 900 million, and average incomes in urban households increase by close to
40%, driving up appliance ownership rates. In the Stated Policies Scenario, on average
90% of urban households own a television and 55% a refrigerator by 2040. Ownership of air
conditioners triples by 2040, but even in urban areas air conditioner ownership rates
remain among the lowest in the world, despite the hot climate in many areas (see
Chapter 2). Average urban household incomes are more than twice as high in the Africa
Case relative to the Stated Policies Scenario, which leads to urban households purchasing
more appliances, and electricity demand in urban areas increases at 10% per year,
compared with 7.4% in the Stated Policies Scenario. More people own air conditioners in 3
the Africa Case, but two-thirds of urban households remain without in 2040.
In the Africa Case, universal access to electricity in rural areas of sub-Saharan Africa
(excluding South Africa) results in an additional 210 TWh of electricity demand by 2040.
Rural households also benefit from higher levels of appliance ownership, roughly doubling
the average number of televisions, refrigerators and washing machines in the Africa Case
relative to the Stated Policies Scenario. Rural ownership of air conditioners remains
uncommon. The impact of universal access and higher incomes is enough to see average
per capita consumption in rural areas increase ten-fold to 320 kWh in the Africa Case,
compared to only 100 kWh in the Stated Policies Scenario.
The services sector benefits from increasing electrification which contributes to economic
growth. Electrification of the services sector is often a by-product of household
electrification efforts, but it can also be an objective in itself: in Rwanda, the Energy Sector
Strategic Plan announced in 2018 aims to bring electricity access by 2024 to all public
infrastructure, schools, health facilities, small businesses and administrative offices, in
addition to households. In the Stated Policies Scenario, electricity demand from the
services sector reaches 170 TWh in sub-Saharan Africa (excluding South Africa) by 2040,
with the majority of growth stemming from demand for cooling and appliances.
Achievement of the electrification and economic growth targets in the Africa Case sees
demand from the sector increase by a further 170 TWh.
Industry contributes to around 30% of the growth in electricity demand to 2040 in the
Stated Policies Scenario. Electricity demand from industry increases at an annual average of
6%, which is a third faster than the rate of growth of total industry sector energy demand.
Much of the growth comes from the use of electric motors in processing, manufacturing
and other light industries. The Africa Case sees a step up in the rate of electricity demand
growth in industry to 7.5%, driven by the modernisation of industry and increasing
domestic demand for locally produced goods as well as expanding exports. Improvements
in industrial energy efficiency in the Africa Case temper demand growth as well as helping
to improve the competitiveness of industry. By 2040, electricity demand from industry
exceeds 340 TWh, 100 TWh higher than the Stated Policies Scenario.
The agricultural sector sees increasing electricity demand for irrigation (some of it met
through the use of stand-alone solar photovoltaic [PV] powered pumping systems) and for

cooling (to support refrigerated storage of produce). The expansion of irrigation and
cooling leads to important productivity gains,4 and these bring further increases in
electricity demand. Electricity demand for agriculture increases from about 3 TWh today to
over 6 TWh in the Stated Policies Scenario, while in the Africa Case it rises to 36 TWh as a
result of a larger increase in value added in the sector and a bigger shift from other sources
of energy to electricity.
The electrification of transport struggles to get started in the Stated Policies Scenario: there
are very few policies that support electric vehicles (EVs) (cars, buses, trucks and two/three-
wheelers) and electricity accounts for only 0.5% of transport energy demand by 2040.
Progress is faster in the Africa Case, but electricity still powers less than 1% of cars by 2040,
together with around 18% of two/three-wheelers. By 2040, electricity demand for
transport reaches 15 TWh in the Africa Case: this is almost triple the level in the Stated
Policies Scenario.
The limited electrification of transport even in the Africa Case is a result of the size of the
power requirements for EV charging, relative to other uses. Designing the extension of
electricity access with the electrification of transport in mind would significantly increase
the costs of achieving universal access. Concerns over the reliability of electricity supply
and the costs of EVs also hinder their uptake. Conditions for the electrification of transport
are more favourable in urban areas with existing grid connections: as a result, the majority
of EV uptake in Africa is concentrated in cities, with almost 30% of the urban two/three-
wheeler fleet electrified by 2040.
3.3.2 Electricity demand growth by region

The evolution of electricity demand is far from homogenous across African countries; it
ranges from 4.5% to 8.5% per year through to 2040 in the Stated Policies Scenario,
reflecting disparities in economic developments and the rate of progress in improving
electricity access. Kenya, Ghana and Ethiopia all reach universal access to electricity before
2030, raising average per capita electricity demand to 450 kWh, 750 kWh and 375 kWh
respectively in 2040. Per capita electricity demand growth is more limited in countries with
lower average incomes today, and in those that experience the fastest population growth
or make slower progress on electricity access, such as DR Congo and Nigeria (Figure 3.6).
While higher than average incomes contribute to higher per capita electricity demand by
2040 in Angola, Ghana and Côte d’Ivoire relative to the regional average, it is the larger
economies that lead total electricity demand growth. About 15% of the increase in total
electricity demand in the Stated Policies Scenario across sub-Saharan Africa (excluding
South Africa) comes from Nigeria. Ethiopia accounts for a further 9%, with Tanzania, DR
Congo and Angola not far behind. Overall, just seven sub-Saharan African countries account
for over half of demand growth over the outlook period in the Stated Policies Scenario.
4
Chapter 4 of Energy Access Outlook 2017: From Poverty to Prosperity takes an in-depth look at how energy
can improve agricultural productivity in Africa (IEA, 2017).

Figure 3.6 ⊳ Electricity demand per capita and share of regional electricity
demand by scenario, 2018 and 2040
0.00 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00
1 250 15%
kWh per capita
2018
1 000 12% 2040 STEPS
750 9% 2040 AC
Share of region*
500 6% (right axis)
250 3% 2018 3
2040 STEPS
2040 AC
Kenya
Côte d'Ivoire
Nigeria
Ghana
Angola
Tanzania
DR Congo
Mozambique
Ethiopia
Senegal
Electricity demand per capita rises fastest in the Africa Case, but in 2040 it is still only
around a third of today’s average in other developing countries
* Region = sub-Saharan Africa excluding South Africa.

In the Africa Case, even those countries that have lower average incomes and currently are
making slow progress on access to electricity see a jump in per capita electricity demand,
thanks to the combined impacts of universal access to electricity and accelerated economic
growth across all sectors of the economy. In DR Congo, for example, electricity demand is
625 kWh per capita in 2040 in the Africa Case, more than double the level in the Stated
Policies Scenario as a result of a near 9% gross domestic product (GDP) growth rate and the
electrification of an additional 120 million people. In absolute terms, this translates to an
additional 55 TWh of electricity demand in 2040, enough to see DR Congo’s share of total
electricity demand in sub-Saharan Africa (excluding South Africa) increase from 5% in the
Stated Policies Scenario to 7% in the Africa Case.
Box 3.1 ⊳ Electricity in South Africa – deep transformation ahead?
South Africa’s energy landscape looks different from that of other sub-Saharan
countries. The country has a more mature economy than its neighbours and a history of
relatively low energy prices, in particular for coal and electricity. The competitiveness of
electricity relative to other fuels results in a share of electricity in final energy
consumption of 25% today, which is high by international standards. This has favoured
the development of energy-intensive industries and the extensive electrification of

energy use in buildings. South Africa currently accounts for over half of all electricity
consumed in sub-Saharan Africa.

Competitive electricity prices and the coupling of clean cooking efforts with
electrification mean that around 85% of South African households cook with electricity
today. Electrifying cooking increased residential electricity demand, but the largest
consumer of electricity in South Africa remains the industry sector, which accounts for
60% of demand.
In the Stated Policies Scenario, South Africa sees further electrification of the economy
with electricity demand growing at nearly 2% per year to reach 320 TWh by 2040,
equivalent to demand in the United Kingdom today. Average residential electricity
consumption reaches nearly 1 400 kWh per capita in 2040, the same level as Korea
today and seven-times higher than the average for the rest of sub-Saharan Africa in
2040. Thanks to very proactive government programmes, only 5% of the population
does not have access to electricity today, mainly in remote areas. South Africa is on
track to achieve universal access well before 2030.
In the Africa Case, the impact of increased electrification across the economy (and more
rapid economic growth) is offset by significant improvements in efficiency. The scope
for further energy efficiency improvements remains large for motors in industry,
heating in buildings and air conditioning. Maximising this potential moderates demand
growth. By 2040, electricity demand in the Africa Case is 6% (20 TWh) lower than in the
Stated Policies Scenario. Pulling the efficiency lever is central to ensuring reliable,
secure and affordable electricity supply.
Although access to electricity has improved, the reliability of electricity supply has
deteriorated over recent years with severe power disruptions. A shortage of generating
capacity, mainly caused by disruptions and maintenance needs of old coal-fired power
plants and delays in the construction of new thermal plants, has caused the vertically
integrated state-owned utility, Eskom, to regularly resort to rotational load shedding.
South Africa’s latest draft Integrated Resource Plan (IRP 2018) points to a new direction
for the power sector, and opens the door for alternatives to coal-fired generation based
on a market-based model. The government seeks to procure over 30 GW from
independent power producers, half of which will come from the Renewable Energy
Independent Power Producer Procurement Programme (REIPPPP). Falling costs are
indeed making these solutions more competitive. The average levelised cost of
electricity (LCOE) of renewable energy technologies in South Africa has declined
substantially over the last five years – by an estimated 55% for utility-scale solar PV
(about $90 per megawatt-hour [MWh] on average in 2018) and by more than 20% for
onshore wind ($70/MWh). To date, the REIPPPP has attracted about $15 billion in
investment in the power sector (20% foreign) and it is one of the most advanced private
procurement programme for the power sector in Africa (see sections 3.7 and 3.8).
Despite its early success, however, many projects found it difficult to get to the stage of
triggering the release of funding, in part because of political uncertainty and the
deteriorating performance of Eskom.

This shift away from coal reflects South Africa’s goal of lowering carbon dioxide (CO2)
emissions and its commitment to the “peak, plateau and decline” emissions trajectory
that led to the adoption of a Carbon Tax Act in 2019. This strategy implies a significant
decline in the use of coal for electricity generation: its contribution shrinks in the Stated
Policies Scenario from 90% today to just over 40% of in 2040 (Figure 3.7).
Figure 3.7 ⊳ Electricity generation mix by scenario in South Africa
2018 Stated Policies Africa Case

2040 2040 3
1% 3% 0.5%
6% 7% 8%
26%
24%
28%
41%
11%
12%
90% 10%
15%
7% 7%
2%
2%
Coal Natural gas Nuclear Hydro Solar PV Wind Other renewables
An extensive transformation of South Africa’s electricity mix gives much more

weight to renewables, but coal retains a significant share
About 85 GW of additional capacity is required by 2040 to meet growing demand and

compensate for ageing coal plant retirements in the Stated Policies Scenario. Most
additions are renewables units, led by wind and solar (about 25% each), making up
close to 45% of electricity supply by 2040. South Africa is building two coal-fired power
plants (Medupi expected to be completed by 2020 and Kusile by 2024) and despite the
retirement of 30 GW of existing capacity over the period to 2040, coal remains the
dominant fuel in terms of both capacity and generation.
In the Africa Case, the power sector in South Africa proceeds further and faster with
diversification of the generation mix, driven by improved maintenance and
management of the power system as well as the increased effectiveness of the
procurement programme. The contribution of renewables to electricity supply grows at
a much faster rate to provide over half of generation. By 2040, wind and solar PV
become some of the most attractive options while generation costs from fossil fuel
plants increase and wind overtakes coal as the primary source of electricity generation.
Deeper regional co-operation and integration also sees South Africa benefit from
competitive electricity imports, as large hydro projects such as Grand Inga in DR Congo
move ahead more quickly.

Achieving the Stated Policies Scenario would require multiplying current investment
levels by almost three (from $3.7 billion in 2018 to an average of almost $10 billion per
year over the period to 2040). The Africa Case would require 8% less ($9 billion per
year), aided by the impact of additional energy efficiency pushing down electricity
demand. In both the Stated Policies Scenario and the Africa Case investment would
need to shift away from coal (around 35% of total power sector investment in 2018)
and focus more on low-carbon generation and on-grid extension and strengthening.
3.4 Outlook for electricity supply

Efforts to meet rapidly growing electricity demand lead to a significant expansion of the
power system over the period to 2040 in the Stated Policies Scenario. Total power
generation capacity in Africa (which includes on-grid, mini-grid, stand-alone systems and
back-up generation capacity) more than doubles to reach 615 gigawatts (GW) in 2040.
Natural gas remains the primary source of electricity generation, in particular in North
Africa, while the contribution of coal gradually decreases as new projects are offset by
ageing plants retirements in South Africa (Box 3.1). Many countries are actively developing
their considerable renewable energy resource and over two-thirds of the additional power
needs are met by renewables.
Excluding South Africa, the sub-Saharan Africa power sector is already relatively low-carbon
and it remains so in the future in both scenarios (Figure 3.8). In the Stated Policies Scenario,
electricity output increases fourfold, from around 225 TWh in 2018 to just over 900 TWh in
2040. On-grid supply continues to serve as the primary means of delivering electricity, but
decentralised solutions for access play a larger role than anywhere else in the world,
especially in the Africa Case. Although on-grid solutions have traditionally served as the
most cost-effective option to supply electricity in areas close to an existing grid, the falling
costs of stand-alone solar PV and battery storage technologies as well as new business
models using digital and appliance innovations are making these solutions more
competitive. In the Africa Case, mini-grids and stand-alone systems offer the least-cost
solution to deliver over 160 TWh, or nearly 10% of electricity supply, enabling access to
new or improved energy services to more than half of people gaining access by 2040.
In the Stated Policies Scenario, hydropower output almost triples over the period to 2040
and remains the largest source of electricity, although its share of supply declines from a
half today to 35%. Natural gas provides more than a fifth of the additional generation to
2040, and retain a market share above 20%. Falling cost drives fast deployment of utility-
scale and distributed solar PV, and also geothermal and wind: the combined contribution
of these non-hydro renewable resources increases to over a quarter of overall supply.
Coal-fired generation increases from a low base, providing cheap baseload power to meet
fast-growing demand. Generation from oil increases in absolute terms, but its share in
generation declines markedly to 7% in 2040, half its share in 2018.

Figure 3.8 ⊳ Electricity supply by type, source and scenario in sub-Saharan
Africa (excluding South Africa), 2018 and 2040
TWh
500 1 000 1 500 2 000
2018
STEPS
2030
AC
STEPS
3
2040
AC
On-grid Mini-grids and stand-alone systems

2018 Stated Policies 2040 Africa Case 2040
225 TWh 900 TWh 1 760 TWh
4% 3% 5%
4% 2%
1% 2% 2%
7%
1% 4%
17% 24%
24% 23% 27%
5%
51% 15% 7%
35%
6% 5%
26%
Coal Gas Oil Hydro Wind Solar PV Geothermal Other renewables
Most of the soaring electricity needs are met through new grid connections;
renewable sources make the largest contribution, followed by gas
In the Africa Case, electricity output in sub-Saharan Africa (excluding South Africa) soars to
1 760 TWh by 2040, nearly twice the level in the Stated Policies Scenario and about
eight-times 2018 levels. Renewables-based generation accounts for the largest share of the
additional 860 TWh needed, bringing the total share of renewable-based generation to
over 60%. On-grid hydropower and solar PV account for over 40% of the overall generation
mix by 2040, but decentralised renewable solutions also play a much bigger role in
delivering power, providing electricity access to 400 million people across sub-Saharan
Africa (excluding South Africa) by 2040. The substantial increase in electricity demand also
requires major new contributions from gas-fired generation, which account for over a third
of the extra needs relative to the Stated Policies Scenario. With these additions, the share
of gas in the electricity mix increases to nearly 30% in 2040 and it becomes the largest
source of generation in the region. The share of coal declines compared to the Stated
Policies Scenario, as does that of oil. Other renewable power sources such as geothermal
and wind expand to significant levels in several countries benefiting from high quality sites.

Box 3.2 ⊳ Geospatial estimation of the least-cost pathway to universal
access to electricity
Over the years, our World Energy Model (WEM) has been expanded and coupled with
other tools to provide a detailed outlook for electricity access in the next decades.5 As
part of this work, the IEA has been working closely with several leading universities,
including the KTH Royal Institute of Technology (KTH), to analyse the least-cost route to
achieve full access to electricity, using the most recent tools available. Analysis was
done for a few individual countries in 2014 for our first focus report on Africa (Nigeria
and Ethiopia) (IEA, 2014), and for all sub-Saharan African countries in Energy Access
Outlook 2017 (IEA, 2017).
For this Special Focus, the IEA refined its analysis using up-to-date datasets and the
latest version of the Open Source Spatial Electrification Tool (OnSSET)6, developed by
KTH. The results provide detailed coverage of 44 countries in sub-Saharan Africa.
Regional results are presented in section 3.4.2 and national results for 11 focus
countries are shown in the country profiles (Chapter 6).
Overall electricity access objectives and demand projections are determined by country
and region in the WEM based on population dynamics and economic growth for the
Stated Policies Scenario and the Africa Case. They integrate the latest policy
frameworks and national targets as well as technology and energy prices. Demand
related to access is initially assumed at 250 kWh a year for rural and at 500 kWh for
urban households, before growing over time to reach the national average.
Demand and other key drivers (e.g. technology and fuel costs) retrieved from WEM are
then used in OnSSET in combination with several open access geospatial datasets.
These include demographic indicators (e.g. population density and distribution),
infrastructure (e.g. existing and planned transmission and distribution networks, roads),
resources availability (e.g. solar, wind, hydro) and derivative layers (e.g. distance to the
grid, to the closest road or city, diesel transportation cost) among others. The
geospatial model runs a least-cost analysis mainly taking into account techno-economic
factors and yields electrification investment outlooks. While grid densification
(connecting areas close to the existing network) is prioritised, the geospatial model
does not necessarily mirror the detail of government electrification plans (where they
exist) or account for the financial and technical capacities of utilities.
3.4.1 On-grid supply

On-grid electricity supply dominates in urban areas and rural communities close to
transmission lines and accounts for a majority of electricity consumption in sub-Saharan
5
For the full WEM methodology, see www.iea.org/weo/weomodel/.
6
For more details on the Open Source Spatial Electrification Tool, see www.onsset.org; for the latest
OnSSET methodology update refer to Korkovelos, A. et al. (2019).

Africa (excluding South Africa) over the outlook period. The evolution and growth of grid
supply by energy source varies across countries in sub-Saharan Africa, reflecting the
differences in resources, costs and policies of each (Figure 3.9).
In the Stated Policies Scenario, total on-grid installed capacity in sub-Saharan Africa
(excluding South Africa) increases to 270 GW by 2040, a threefold increase from the 80 GW
of installed capacity in 2018. The power fleet steadily diversifies away from traditional
sources of power and over half of the 190 GW of new plants commissioned over the period
are non-hydro renewables (75% when hydropower is included). Gas-fired capacity expands,
while the contribution of oil decreases.
3
In the Africa Case, the power sector proceeds further and faster with ensuring more
reliable and affordable electricity for all (sections 3.5 and 3.6). The design of policies and
the effectiveness of their implementation play a critical role in incentivising timely and
adequate expansion of the physical infrastructure and in ensuring a better performing
power sector. Deeper regional co-operation becomes more important. This all requires a
steep increase in investment and a major reallocation of capital (sections 3.7 to 3.9). The
generation fleet in sub-Saharan Africa (excluding South Africa) nearly doubles compared to
the Stated Policies Scenario, reaching about 490 GW by 2040, driven by the substantial
increase in electricity demand. The capacity mix diversifies further, with renewables
accounting for over three-quarters of the additional installed capacity relative to the Stated
Policies Scenario. Gas-fired generation takes on an increasingly important role in all areas
and rises in tandem with renewables.
Hydropower remains a cornerstone of sub-Saharan Africa’s power system (excluding South

Africa) but its share declines as other renewable technologies and natural gas expand.
Hydropower currently provides more than half of on-grid generation in sub-Saharan Africa
(excluding South Africa) and over 80% of electricity supply in DR Congo, Ethiopia and
Mozambique. In the Stated Policies Scenario, generation from hydropower almost triples
by 2040. Over two-thirds of the 17 GW under construction today are scheduled to come
online by 2025 including the Grand Renaissance Dam (6 GW) in Ethiopia. The Mambilla
Dam (3 GW) in Nigeria helps alleviate local demand for fossil fuel resources and provide
more reliable access to power. In Angola, the Laúca Dam (1 GW) is expected to be fully
operational in early 2020 and the Caculo-Cabaca Dam (2.2 GW) in 2024. Construction of a
major hydropower project (2.1 GW) was launched in Tanzania’s Rufiji Basin in mid-2019.
In the Africa Case, better regional co-operation and integration of power networks is
instrumental in unlocking a larger share of hydropower’s huge potential. Larger markets
absorb the power output from resources heavily concentrated in the Nile Basin and Congo
River, making these resources more economical to develop. Generation from hydropower
quadruples by 2040, led by DR Congo with (115 TWh) by 2040, with the completion of
Stage V of Grand Inga and by Ethiopia with a quadrupling of output (60 TWh). Large
hydropower projects are also developed in Mozambique (including the Mphanda Nkuwa
Dam). These three countries become sizeable exporters to neighbouring countries and
regions.

Figure 3.9 ⊳ On-grid electricity generation by scenario in sub-Saharan Africa
(excluding South Africa) and selected countries, 2018 and 2040
TWh
400 800 1 200 1 600 2 000
Sub-Saharan
2018
Africa
STEPS 2040
AC 2040
TWh
50 100 150 200 250
2018
Senegal
STEPS 2040
AC 2040
2018
bique d’Ivoire
Mozam- Côte
STEPS 2040
AC 2040
2018
STEPS 2040
AC 2040
2018
Ghana
STEPS 2040
AC 2040
2018
Angola
STEPS 2040
AC 2040
2018
Kenya
STEPS 2040
AC 2040
Tanzania
2018
STEPS 2040
AC 2040
2018
Congo
STEPS 2040
DR
AC 2040
2018
Ethiopia
STEPS 2040
AC 2040
2018
Nigeria
STEPS 2040
AC 2040
Coal Gas Oil Hydro Wind Solar PV Geothermal Other renewables

The fuel mix of on-grid electricity supply diversifies in all countries,

with hydropower being increasingly complemented by gas, solar PV and geothermal

In the Stated Policies Scenario and the Africa Case, the share of hydropower in total
electricity generation declines by 15 and 20 percentage points, respectively, as alternatives
become available. While hydropower remains an essential element of electricity supply,
diversifying the electricity mix helps to reduce the risk of power disruptions during
droughts and in the long term to strengthen resilience to changing climate conditions.
Natural gas use continues to increase: the size of the gas-fired power generation fleet in
sub-Saharan Africa (excluding South Africa) more than doubles to 50 GW by 2040 as an
additional 1.6 GW of capacity is added each year on average in the Stated Policies Scenario.
A third of this expansion occurs among traditional gas producers, such as Nigeria, through
increasing efforts to capture and make use of associated gas from oil production. Angola 3
also expands gas-fired generation with the newly commissioned Soyo combined-cycle gas
turbine plant.
In the Africa Case, gas-fired power generation overtakes hydropower in the 2030s to
become the largest source of on-grid electricity generation in the region and accounts for
nearly a third of the electricity mix. This expansion is also driven by additional growth in
countries such as Senegal, Mozambique and Tanzania, which capitalise on newly developed
domestic supplies of natural gas. These countries become pivotal actors in gas-fired
generation as power sector governance improves and enhanced regional co-operation
leads to the development of wider and deeper markets (see Chapter 4). Gas also plays an
increasingly important role in providing back-up power during dry spells in countries that
continue to depend on hydropower.
The deployment of non-hydro renewables accelerates to nearly 5 GW of new capacity per
year between 2019 and 2040 in the Stated Policies Scenario. Solar PV represents 40% of all
new capacity additions over the period. Geothermal resources play a central role in East
African countries and particularly in Kenya where geothermal becomes the largest source
of electricity in terms of both installed capacity and electricity production. The share of
electricity from wind also increases in the Stated Policies Scenario although some of the
best resources remain far from major load centres.
The uptake of these new alternative renewable sources is projected to keep pace with the
higher electricity demand growth in the Africa Case and deployment accelerates to 10 GW
of additional capacity each year over the period. The majority – over 70% – comes from
solar PV. Installed solar PV capacity increases across the entire region to reach about
160 GW in 2040, overtaking hydropower and gas to become the largest source in terms of
installed capacity (and the third-largest in terms of generation output).
Coal-fired power capacity also increases over the outlook, from around 3 GW today to
12 GW in 2040 in the Stated Policies Scenario and 17 GW in the Africa Case, as projects
gradually come online in Zimbabwe, Senegal, Nigeria and Mozambique.
New oil units contribute to only 1% of total additions across the region in the Stated
Policies Scenario, but almost 5% in Nigeria. This reflects the fact that only a few small
projects are currently planned. In the Africa Case, the oil share shrinks further as
programmes to convert oil-fired units to burn domestic gas accelerate, notably in Angola
and Senegal.

S P O T L I G H T
Hydropower in Africa: strengthening resilience to a changing climate
Hydropower is the most important source of low-carbon electricity globally, accounting

for 16% of total electricity generation. In Africa, hydropower plays an even bigger role,
accounting for 22% of electricity generation on average (excluding South Africa). The
full technical potential for African hydropower is far greater – new analysis points to a
total potential of around 1 120 TWh in just 12 countries (taking into account
environmental constraints), which is over eight-times today’s level of hydropower
generation in all of Africa.
Increasing reliance on hydropower may pose risks for the power sector due to impacts
of a changing climate. Changes in rainfall patterns and temperature may lead to
changes in river flows, and in evaporation and transpiration, altering the resource
potential for hydropower. More frequent and intense extreme weather events such as
droughts and floods may also lead to more variability in generation output. While
impacts are likely to vary by region and even locally, climate-related events have
already had noticeable effects on power systems, for example in Zambia where a
severe drought in 2015-16 led to a drop in usable capacity of the largest hydropower
plant and to power blackouts.
New analysis carried out for this World Energy Outlook assessed future climate change
impacts on hydropower outputs and potential in 12 African countries under various
climate change scenarios to 2099. The analysis linked global circulation models with
hydrological models to examine changes of hydropower availability at precise locations
using high-resolution discharge and elevation data (Gernaat et al, 2017). Two
Intergovernmental Panel on Climate Change (IPCC) climate scenarios were compared:
one leading to a global temperature rise likely to be below 2 degrees Celsius (°C) by
2100 (Representative Concentration Pathway [RCP] 2.6), implying a peak in emissions in
2020 and subsequent decline; and the second leading to a global temperature rise of
around 3 °C by 2100 (RCP 6.0), implying a continuing gradual rise in emissions before
they peak well into the second-half of the century (IPCC, 2014).
The annual availability of hydropower (measured by capacity factors) becomes more

uncertain in both scenarios, but year-to-year variability is higher in RCP 6.0, the
scenario with more climate impacts (Figure 3.10). Average annual capacity factors
decline by some 2 percentage points by 2099 in both scenarios. However, hydropower
capacity factors show stronger fluctuation in RCP 6.0 than in RCP 2.6 for most of the
plants analysed (55 out of 64). Several Nile Basin countries (notably Sudan, Uganda,
Egypt and Kenya) experience more than 50% relative increase of annual variability in
RCP 6.0 compared to RCP 2.6, as do Zambia, Mozambique and Morocco. Without
planning to improve resilience, this increased variability could have critical impacts on
the reliability of power systems that are heavily and increasingly reliant on hydropower.

Figure 3.10 ⊳ Variability of annual hydropower capacity factors for
selected African countries by climate scenario, 2020-2099
Egypt Ghana Malawi Mozambique Tanzania Zambia

DR Congo Ethiopia Kenya Morocco Sudan Uganda
20%
0%
-20%
3
-40%
-60%
RCP 2.6 RCP 6.0
Increased greenhouse gas concentrations are associated with an

intensification of year-to-year variability in hydropower generation
Note: RCP = Representative Concentration Pathway (IPCC, 2014).
Regional differences in hydropower availability also become more marked under the
scenario with the higher global temperature rise (RCP 6.0). For example, hydropower in
Morocco is projected to see a 9% decrease in capacity factors under RCP 2.6, while
capacity factors in Nile Basin countries (Egypt, Kenya, Sudan and Uganda) would
increase by 0-2%. In RCP 6.0, these differences are accentuated, with drier conditions
leading to Morocco’s outputs declining by 24% relative to today, compared to 4-8%
increases in the Nile Basin. These striking regional differences underline the importance
of developing enhanced interconnections and power pools that link countries and
sub-regions together.
The sensitivity of African hydropower to rises in global temperature points to the

importance of integrating climate resilience – the capacity to absorb, accommodate,
adapt to and recover from climate change impacts – into planning for the construction
and operation of future hydropower plants. For example, most planned hydropower
projects do not currently take into account projected hydrological changes, relying
instead on historical conditions (CDKN, 2015). This could lead to suboptimal operation
of plants, at a time when many African countries are increasingly expecting hydropower
to satisfy rapidly increasing power demand and to be a source of flexibility to support
the integration of variable renewables such as wind and solar PV.

3.4.2 Role of decentralised systems to reach universal access to electricity
Geospatial analysis indicates that the least-cost way to reach full access by 2030 and to
meet demand from newly connected households is to deploy mini-grids and stand-alone
systems while also extending the main grid (Box 3.2). Providing electricity for all in
sub-Saharan Africa would require an additional investment of around $25 billion per year
above the level mobilised in the Stated Policies Scenario over the period to 2030.
In the Stated Policies Scenario, grid connections constitute the least-cost option for around
70% of the 230 million new connections that are expected to be achieved by 2030, mainly
in areas that are close to a grid. A high proportion of the population lives close to a network
(see Chapter 1), and grid densification connects around 70 million people, mainly in urban
areas, while grid extension reaches more than 90 million, almost all living in rural areas. The
number of people who gain access from decentralised solutions increases to almost
70 million over the period as technology costs continue to decline.
Figure 3.11 ⊳ Solutions to provide electricity access by area and scenario in

sub-Saharan Africa, 2019-2030
Urban areas Rural areas

600
Population (million)
Stand-alone systems
500 Mini-grids
Grid extension
400
Grid densification
300
200
100
STEPS AC STEPS AC
Access in urban areas will largely be via grid connections, while decentralised solutions
are the least-cost option for about 370 million people in rural areas to reach full access
Sources: IEA analysis; KTH-dESA.
Decentralised systems are even more important to bring electricity to the 530 million
additional people who need to be reached in the Africa Case in order to provide access to
electricity for all. They represent the least-cost solution for more than two-thirds of these
additional connections. Mini-grids play a major role in closing the gap in urban areas that
cannot be reached by the grid before 2030, accounting for almost half of the additional
urban connections. In rural areas, decentralised solutions provide more than three-quarters
of additional connections, with mini-grids and stand-alone systems both having a role to
play depending on population density (Figure 3.11). As a result, decentralised systems

connect in total almost 450 million in the Africa Case by 2030. They can be installed quickly,
providing valuable basic energy services to households who would otherwise need to rely
on polluting and inefficient fuels. If deployed carefully, such systems can complement the
grid, providing services immediately and preparing the way for later grid extension.
The best way to determine the optimal mix of solutions to provide access to all is to
prepare integrated plans based on geospatial mapping. Such plans allow governments to
develop a precise strategy, assess the investment needed, design adapted policies to reach
all populations, and clarify the roles of different actors (government stakeholders, donors,
private sector and non-governmental organisations). Turning such plans into actual
investment flows and concrete progress on the ground raises some challenges (section 3.9), 3
but they remain the best way to develop an integrated approach and to facilitate private
sector participation.
Several countries, including Ghana, Senegal, Ethiopia, Nigeria and Rwanda, have developed
long-term comprehensive strategies. As an example, the Ethiopian government announced
plans in its 2019 National Electrification Plan to connect 100% of households by 2025 by
connecting to the grid those 65% of households located less than 2.5 kilometres (km) from
the existing network and putting in place decentralised solutions for the remaining 35%. By
2030, the government plans to extend the grid to reach households located between
2.5 km and 25 km from the existing grid. The 5% of households living farther than 25 km
from the grid would have decentralised solutions over the long term.
3.5 Reliability
The provision of high quality electricity services is essential to economic growth. An
electricity supply that is unreliable acts as a brake on overall economic activity and welfare,
and inhibits the output of individual firms. The provision of low quality or unreliable
electricity supplies forces firms to manage gaps in supply or to turn to more polluting and
expensive alternatives such as diesel generators. Both choices have detrimental effects on
firm efficiency and undermine competitiveness.
Poor electricity infrastructure in low-income countries is a major cause of unreliability
(Figure 3.12). Under-investment in existing transmission and distribution assets and the
inability to meet peak load due to installed capacity deficit result in frequent service
disruptions (unscheduled outages or regular load shedding), ranging from a few hours to a
few days. Between 2006 and 2018, around 80% of sub-Saharan African firms suffered
frequent electricity disruptions, typically six hours in length, imposing losses of around
8% of annual sales on average (World Bank, 2018). Outages tend to be most frequent and
prolonged in Nigeria (see Chapter 1). By contrast, firms in Organisation for Economic
Co-operation and Development (OECD) countries experience interruptions of around one
hour per month on average.
Investment in power systems, combined with improvements in the performance of utilities,

results in a decline in the number of outages in sub-Saharan Africa by the end of the
projection period. In the Stated Policies Scenario, the number of hours lost as a result of

Figure 3.12 ⊳ Electricity outages and GDP per capita in selected regions, 2017
10 000
Total duration of electricity disruptions
1 000
(hours per year)
100
10
0
10 000 20 000 30 000 40 000
GDP per capita (Dollars 2018,PPP)
Share of firms affected 50% 100%
Asia C & S America Europe/Eurasia North Africa Sub-Saharan Africa Focus countries
Frequent outages tend to be concentrated in low-income sub-Saharan countries
Notes: C & S = Central and South America. PPP = purchasing power parity. Focus countries are Angola,
Côte d’Ivoire, DR Congo, Ethiopia, Ghana, Kenya, Mozambique, Nigeria, Senegal and Tanzania.
Source: IEA analysis based on World Bank (2019a).
Figure 3.13 ⊳ Reliability indicators by scenario in sub-Saharan Africa

(excluding South Africa), 2018 and 2040
Outages Back-up generators T&D losses

4 000 25% 160 20%
TWh
Hours
20%
3 000 120 15%
15%
2 000 80 10%
10%
1 000 40 5%
5%
2018 STEPS AC 2018 STEPS AC 2018 STEPS AC

2040 2040 2040
Nigeria Other sub-Saharan Africa Right axis Share of year Share of supply
Major improvements in reliability in the Africa Case reduce the incidence of power outages
by 60% in Nigeria and over three-quarters elsewhere; network losses shrink to below 10%
Note: T&D = transmission and distribution; STEPS = Stated Policies Scenario; AC = Africa Case.

outages declines to around 900 hours a year on average across the region; this ranges from
below 1% of the year in Mozambique, Senegal, Kenya and Côte d’Ivoire up to nearly 30% in
Nigeria, despite significant progress there. The number of outages declines even further in
the Africa Case, falling to less than 500 hours a year on average and to about 15% of the
year in Nigeria (Figure 3.13). As a result, the output of back-up generation declines in the
Stated Policies Scenario from 40 TWh a year to around 30 TWh a year and to less than
5 TWh a year the Africa Case, reducing fuel and maintenance costs, noise and air pollution.
Inefficiencies arising from network losses can be very costly for utilities. Network losses are
very high in sub-Saharan Africa (excluding South Africa) and at 18% are higher than in other
developing regions (see Chapter 1). Investments in power systems result in losses falling to 3
around 14% in the Stated Policies Scenario and to as low as 9% in the Africa Case.
Box 3.3 ⊳ Improving grid reliability: a pathway for lower cost electrification
Providing access to electricity is essential, but access has to bring with it a reliable supply
of electricity if households, businesses and public services are to reap the full benefits. A
lack of reliable electricity supply from the grid disrupts daily lives and activities, lowers
trust and use of the grid, and increases costs for consumers and utilities. Grid reliability
also influences the best mix of solutions to provide universal access to electricity, by
improving the cost-effectiveness of extending the grid to connect more potential
consumers. This in the end affects the overall cost of electrification.
To shed light on the relations between the least-cost pathway to universal access and
grid reliability, we developed a new analysis in collaboration with the MIT-Comillas
Universal Energy Access Lab. Using the Reference Electrification Model (REM), building
level geospatial analysis informs network and mini-grid deployment and design to
optimise electrification planning (MIT-IIT, 2019). Taking an excerpt from the National
Electrification Plan of Rwanda as a test case, we considered a rural and peri-urban area
of 30×60 km in the Nyagatare region, with some 48 000 buildings that represent about
22 different consumer profiles (from 100 Watts [W] to 300 kW peak demand). Through
the REM, we examined the least-cost electrification solutions for these consumers at
various levels of grid reliability, defined as the percentage of demand served. The results
highlight the complementarity of on-grid and decentralised solutions at all grid reliability
levels in the area analysed (Figure 3.14). Poor grid performance, similar to the situation
currently observed in many countries, contributes to the attractiveness of decentralised
solutions to connect up to two-thirds of those gaining electricity access. These solutions
remain attractive even with reliability improvements, a trend accentuated by expected
declines in costs of decentralised systems. Nonetheless, improving the reliability of the
grid could facilitate optimising the infrastructure by connecting more consumers and
increasing average consumption of electricity, in addition to removing a major obstacle
to development of businesses and community services. The additional investments to

improve reliability by installing sufficient generation capacity to cover peaks would be
offset by a decline in the cost per unit of demand served.

Investing in better grid reliability to optimise grid utilisation, while deploying
decentralised systems to reach populations distant from networks, appears to be the
best way to provide improve access to electricity at the lowest cost.
Figure 3.14 ⊳ Connections by type to reach universal access to electricity

with different grid reliability levels in a region of Rwanda
100% 400
Dollars per MWh (2018)

75% 350
50% 300
25% 250
200
80% grid reliability 90% grid reliability 100% grid reliability
Decentralised systems Grid Average cost per demand served (right axis)
Even with high grid reliability, decentralised systems would be cost effective for
many people; improving grid reliability can reduce the cost per demand served
Power sector regional integration

Increased power sector integration in sub-Saharan Africa can help with the goal of
providing more affordable and reliable power. Affordability can be improved by reducing
the need for investment: access to other markets allows countries to reduce the amount of
installed capacity needed to meet peak demand, and sharing reserves between balancing
areas means each can maintain less reserve capacity. Closer integration also enhances
reliability by allowing the system to respond better to seasonal imbalances and unexpected
shocks. Sub-Saharan African countries enjoy a diverse range of natural resources and have
scope to benefit from the complementary nature of those resources.
Economies of scale achieved at a regional level may also enable countries to proceed with
large projects that would not be justified based only on domestic power demand levels.
Completion of Stage V of Grand Inga and associated interconnection projects in Southern
African countries, for example, would allow the export of hydropower from DR Congo in
the Africa Case and would significantly reduce average electricity generation costs in the
region.
To realise these gains, governments and utilities across the region need to step up
co-ordination in order to increase investment in transmission infrastructure, establish
regional markets and improve regulation for cross-border trading (for example by defining
and implementing regional transmission tariffs).

3.6 Affordability
The affordability of energy is a primary concern for policy makers, businesses and
consumers. As discussed in Chapter 1, many households cannot afford the often very high
upfront costs of grid connection, and current electricity tariffs make even basic energy
services unaffordable for a large share of the population connected. However, the tariffs
that constrain affordability for consumers are often set too low for utilities to be able to
recoup their costs of supply. The risk is that this locks the power sector into a cycle of low
revenue, high debt, inadequate maintenance, under-investment and poor quality of
service. One of the biggest challenges of achieving universal access to electricity relates to 3
the cost of providing power, which increases dramatically to supply sparsely populated and
remote areas compared with households close to an existing grid. Our geospatial analysis
shows that the least-cost option to provide access increases by a factor of four from easily
accessible areas to the most remote ones (Figure 3.15). It is therefore inevitable that
ensuring access to all requires government policies, subsidies and tax exemptions in one
way or another. Much is already being done. In Togo, for example, the government recently
announced its CIZO Plan to electrify 555 000 households with solar kits; the “CIZO solar
cheque” will subsidise the hardware costs for households with a monthly payment, in
partnership with a few licenced companies.
Supporting energy efficiency and productive uses can also help to improve affordability.
Energy efficient appliances can enable consumers to access higher levels of energy services
at lower costs, and so reduce the size (and the cost) of the system needed to support these
services (IEA, 2017). Broadening the scope of electricity access plans to include the
provision of energy for productive uses, such as agriculture or industry, can support the
ability of end-users to pay while at the same time bringing down the cost of supply by
increasing the load factor. Providing support for the acquisition of efficient equipment
along with access to electricity can bring multiple benefits. A recent study from the World
Bank (ESMAP, 2019) indicates that many productive tools and equipment appear to have a
pay-back period of less than 12 months. Private companies including providers of mini-grid
and solar home systems are starting to consider how best to support the development of
commercial activities among electrified communities to ensure the sustainability of their
projects. Success on this front will require cross-sectoral planning and co-ordination (for
example between energy, water and agriculture ministries) as well as financial support.
Fossil fuel consumption subsidies have been used by a number of countries as a way of
making electricity more affordable for citizens and companies (potentially helping them
become more competitive). Some sub-Saharan countries, for example Ghana, subsidise
certain fossil fuels as part of a strategy to promote switching from the use of traditional
biomass. While fossil fuel subsidies – relatively more prevalent in North Africa – can help to
support the use of energy services by the poorest households, they also create a
substantial fiscal burden on what are often overstretched government budgets. We
estimate the value of fossil fuel consumption subsidies in 2018 to have been $2.9 billion in
Nigeria, $5 billion in Libya, $17 billion in Algeria and $27 billion in Egypt.

Figure 3.15 ⊳ Levelised cost of electricity (LCOE) to achieve universal access
to electricity by 2030 in sub-Saharan Africa, in the Africa Case
The cost of supplying electricity varies dramatically depending on household location;

decentralised solutions are often the cheapest option for remote households
Notes: Each point represents an individual settlement in sub-Saharan Africa. It shows the LCOE of the least-
cost solution determined for each settlement through our geospatial analysis (see Box 3.2).
Source: IEA analysis; KTH-dESA.
Amending current fossil fuel subsidy schemes is desirable for a number of reasons. These
include: the need to reflect the true cost of electricity and remove distorted incentives
(with implications for investment decisions); the need to reduce consumption of electricity
from emissions-intense sources and encourage the use of more efficient and low-carbon
sources; and the need to reduce the resultant fiscal burden that such subsidies cause.
Successful reform programmes broadly share the same key design and implementation
features. They tend to focus in particular on being clear about the amount of the subsidy
and the different categories of consumers who benefit from it. Obtaining wide
understanding of, and support for, proposed reforms is essential: gradual implementation
and assistance to the poorest households may be needed. There is plenty of experience in
other countries to draw on and learn from. International development finance institutions
can provide technical and financing assistance to help with fossil fuel subsidy reform.

3.7 Investment needs for reliable, sustainable and
affordable power
The amount of investment needed for the provision of electricity in sub-Saharan Africa is
substantial and well above the level of the current flows of capital into the region’s power
sector. Achieving the outcomes projected in the Stated Policies Scenario would require
annual power sector investment in sub-Saharan Africa to more than double to around
$46 billion per year, and would mean a cumulative total of more than $1 trillion in
investment between 2019 and 2040 (1.6% of the regional GDP over the period). The Stated
Policies Scenario would see the electricity access rate rise to 64% in 2030. 3
Reaching full access by 2030 and maintaining it to 2040, as in the Africa Case, would require
multiplying current investment levels by five. The cumulative investment in this case would
reach more than $2 trillion between 2019 and 2040 (2.7% of the regional GDP in the Africa
Case over the period), or over $100 billion per year, more than doubling the capital needed
under the Stated Policies Scenario (Table 3.2). Half of the investment needs would be spent
on grid expansion, reinforcement and maintenance. Most of the rest would be for low-
carbon power capacity, where solar PV takes an important role, reaching almost $25 billion
per year on average. Cumulative investments in solar PV by 2040 in the Africa Case reach
$535 billion. Decentralised solutions (mini-grids and stand-alone systems) would take an
even more central role in this scenario, capturing a fourth of all investment in new capacity
over the period to 2040.
Table 3.2 ⊳ Average annual power sector investment in sub-Saharan Africa

by scenario, 2019-2040 (Billion dollars, 2018)
Stated Policies Scenario Africa Case

On-grid Mini-grid and Total On-grid Mini-grid and Total
stand-alone stand-alone
Total power plants 19.3 1.7 21.0 34.1 16.8 50.8
Coal 2.0 0.0 2.0 1.7 0.0 1.7
Natural gas 1.3 0.0 1.3 2.9 0.0 2.9
Oil 0.0 0.1 0.2 0.4 0.5 0.8
Hydro 4.4 0.0 4.4 7.7 0.0 7.7
Solar PV, wind, 11.6 1.6 13.2 21.4 16.3 37.7
other low-carbon
T&D 25.3 0.2 25.5 49.0 2.5 51.5
Total 44.6 1.9 46.5 83.1 19.3 102.3
Note: T&D = transmission and distribution; Other low-carbon = bioenergy, nuclear and other renewables.
In addition to higher investment levels, a reallocation of capital would be needed across

countries and technologies in both scenarios. In South Africa, a major reallocation of capital
away from coal-fired power (currently around 35% of the investment) towards electricity
networks and low-carbon generation would need to happen (Figure 3.16). Nigeria, Ethiopia

and DR Congo are the other countries with the highest annual investment needs. Together,
these four economies account for around 40% of the investment needs in both outlooks. In
addition, investment in natural gas generation would also need to pick up and maintain the
current investment pace. Average annual investment in natural gas in the 2019-40 period in
the Africa Case is more than twice that of the Stated Policies Scenario and four-times the
2018 investment level. With more renewable plants and higher access levels, gas helps
maintain security of supply at lower emission levels than other fossil fuels.
Figure 3.16 ⊳ Annual average power sector investment by scenario in

sub-Saharan Africa
Fossil fuels Low-carbon Electricity networks

50
40
30
20
10
2018 STEPS AC 2018 STEPS AC 2018 STEPS AC

2019-40 2019-40 2019-40
South Africa Nigeria Ethiopia DR Congo Other sub-Saharan Africa
The investment gap is particularly large for renewables and electricity networks in both
outlooks, and needs to accommodate more capital for natural gas in the Africa Case
Notes: STEPS = Stated Policies Scenario; AC = Africa Case. Low-carbon generation includes renewables and
nuclear (nuclear only projected in South Africa).
Who will supply the capital needed to enable this investment? While investments will
inevitably be funded from a variety of sources and types of funds – international and local;
private and public; equity and debt – the choice of capital provider and financing vehicle
makes a big difference to the pace and affordability of Africa’s shift towards more reliable,
sustainable and affordable power. The approach taken needs to be informed by an analysis
of the ways in which power sector investments have been financed in sub-Saharan Africa,
the drivers for investment decisions, and the priority areas necessary to tackle investment
risks. Such an analysis can help with the design or the re-evaluation of policies and
regulations to ensure their ability to reduce the cost of capital, especially for renewables
where financing costs account for around half of the LCOE. The first part of this section
addresses this by presenting an overall picture of the financing of the power sector in
sub-Saharan Africa and describes the role of private financing in particular. The second part
identifies four priority areas that require further policy and regulatory interventions to
reduce investment risks and scale up the funds needed to finance investments.

3.8 Sources of finance for power investment
The majority of the power sector investment in sub-Saharan Africa has been financed by
public funds, mainly from domestic governments or state-owned utilities, development
finance institutions (DFIs) and export credit agencies (ECAs). Of the new projects with final
investment decisions in the period 2014-18, two-thirds of the new generation capacity was
publicly funded. The level of reliance on public funds was highest for large, conventional
generation projects and lowest for renewable projects, in part because in South Africa all
new renewable capacity since 2011 has been procured via a competitive tender 3
programme (Figure 3.17). The role of DFIs and ECAs as financiers has been important across
the board, but particularly so for large coal-fired generation and hydropower projects
where they accounted for around 60% of funds raised. Chinese DFIs have played an
especially visible role: between 2013 and 2017 over $10 billion of Chinese funds financed
80% of the total investment for ten hydropower projects (over 6 GW) and over $6 billion
for five coal-fired plants.
Figure 3.17 ⊳ Financing sources for power generation investment by share,

type and capacity in sub-Saharan Africa, 2014-2018
100% 15
GW
80% 12
60% 9
40% 6
20% 3
Coal Hydro Gas Solar PV Geothermal Wind

Public (governments and SOEs) Public (DFIs and ECAs) Private Capacity (right axis)
Large-scale generation projects have been more reliant on public sources of finance,
while renewables were financed more with private finances
Notes: DFIs = development finance institutions; ECAs = export credit agencies; SOEs = state-owned
enterprises. Based on utility-scale projects that reached financial close between 2014 and 2018.
Sources: IEA analysis based on World Bank (2019) and IJ Global (2019).
3.8.1 Investment framework and market structure

Private sector financing has been focused on generation (Figure 3.18), mainly through
projects developed by independent power producers (IPPs).7 In contrast, most of the
7
IPPs are generation projects owned and operated by entities other than utilities, e.g. private developers.

investment in electricity networks has come from the public sector. To date, 16 of 43 sub-
Saharan African countries do not allow for private sector participation in electricity
generation or networks, and 18 others only allow it in power generation.
Figure 3.18 ⊳ Private sector participation in electricity supply in

sub-Saharan Africa by activity
Generation
Transmission
Distribution
20% 40% 60% 80% 100%

Private sector participation Allowed Not allowed
In many countries there is no private sector participation allowed.
Where it is allowed, it is mainly in the generation activity.
Notes: In the distribution category, decentralised solutions are not included. Based on 43 countries in
sub-Saharan Africa.
Unlike power generation, transmission and distribution grids have monopolistic

characteristics and are generally subject to strong regulation. In sub-Saharan Africa, private
sector participation in transmission has come about mainly through “whole-of-grid
concessions”8, but these did not result in much investment and two-out-of-three were
cancelled (World Bank, 2017). Private participation in distribution networks is more
common, also under concessions, but it is still far from usual: fewer than ten countries in
Africa allow it (Eberhard et al., 2016).
Supportive policies and regulations as well as maturing markets have helped attract private
sector investment into mini-grids and stand-alone systems. The World Bank estimates that
there has been almost $4 billion of cumulative investment in Africa to date in almost
1 500 mini-grids (ESMAP, 2019). Although the majority of mini-grids were financed and are
operated by state-owned utilities (some installed long ago), the privately-financed market
has been growing – there are about 480 mini-grid developers in the African market today.
Estimates based on another study of the global solar market of stand-alone systems show
that 75% of the total funds raised by top developers between 2012 and 2017 (almost
$700 million) went to developers operating in East and West Africa (IFC, 2018).
8
Whole-of-grid concessions are long-term contracts where a private company is responsible to operate and
maintain the existing grid, as well as investing in new lines and ensuring quality of supply. The company’s
annual revenues are set by a regulatory authority and subject to periodic revisions.

3.8.2 Private financing is concentrated in IPPs, mostly in South Africa
For almost 90 utility-scale IPP projects that obtained financing between 2014 and 2018 in
sub-Saharan African countries, more than 60% of the funds were from private sources
(World Bank, 2019a). Improved policy frameworks helped reduce perceptions about risks
and increase project bankability. Lenders were willing to lend more money and the average
share of costs that they were willing to cover rose from an average of 67% in 2014 to 79%
in 2018.
Figure 3.19 ⊳ Sources of financing for independent power producers

in sub-Saharan Africa financed between 2014 and 2018
3
South Africa Other sub-Saharan Africa
Public and DFIs

5%
International 14%
14%
Local
47%
Private 26%
59% 22%
International
Local 13%
Policy frameworks to underpin IPP projects are less developed

in sub-Saharan Africa, other than South Africa, which limits the ability of
public and development finance to catalyse private investment
Note: DFIs = development finance institutions; IPP = independent power producers.

Sources: IEA analysis based on World Bank (2019a) and IJ Global (2019).
South Africa alone attracted two-thirds of the private finance for IPPs, or almost $7 billion
over the 2014-18 period. In South Africa, IPPs were less reliant on public funds and required
lower shares of equity than in other countries, with the private sector providing more than
80% of funds for IPPs (Figure 3.19). A good enabling environment, combined with a well-
developed financial sectoral and clear sector policies were critical factors. A notable
example is the Renewable Energy Independent Power Producer Procurement Programme
(REIPPPP), a competitive programme to tender all new renewable capacity introduced in
2011, which was instrumental in enhancing the bankability of renewable projects.
However, delays in the recent rounds of the programme – driven by political uncertainty as
well as the deteriorating financial performance of state-owned utility Eskom – have raised
questions over the positioning of the REIPPPP in South Africa’s overall power sector
development.

The financing picture is very different in other parts of sub-Saharan Africa. In most other
countries there has been a high degree of reliance on public funds to finance IPP projects,
and public and development finance has not been as effective in catalysing private
financing, though this has varied between countries. Between 2014 and 2018, every dollar
funded by public and development finance was matched by one or more dollars of private
funds in Namibia, Nigeria, Mozambique and Ghana, but slightly above half a dollar in
Zambia, and less than that in other countries. On average, every dollar funded by public
and development finance was matched by half a dollar of private funds, whereas in the
case of South Africa each dollar was matched by almost four dollars of private finance.
Table 3.3 ⊳ Selected large development finance initiatives supporting

sub-Saharan Africa’s power sector
Committed Type of support by project phase

Initiative Main financiers funds Implemen-
(billion $) Preparation Financing
tation
Mainly developed
Green Climate Fund
countries
5.2   
France, Germany
Africa Renewable
Energy Initiative
and European 10.0   
Commission
Clean Infrastructure Developed
Funds countries
8.1  
New Deal on Energy African Development
for Africa Bank
12.0   
The World Bank Group, the African Development Bank (AfDB), European governments and
institutions, and the United States and Japanese governments provided most of the public
funds used in the sub-Saharan African power sector between 2008 and 2017. The majority
of this went to transmission and distribution projects, then to renewable-based generation
and last to non-renewable power. The three main recipient countries were Kenya, Tanzania
and Ethiopia (OECD, 2019). Separately, DFI funding from China has been growing rapidly
(Horn, Reinhard and Trebesch, 2019). Funding has come from other sources too: a diverse
array of organisations have established initiatives and committed funds to support power
infrastructure development or help with project preparation, financing and implementation
support (Table 3.3). Some initiatives, like US-led Power Africa or the AfDB’s New Deal on
Energy for Africa, expect their commitments to bring in significant additional funds. For
example, the AfDB’s New Deal on Energy for Africa expects to leverage $45-50 billion in co-
financing by 2020. Similarly, the Power Africa programme has supported power sector
investments in Africa that, if fully realised, would total more than $50 billion.
Development finance support has been substantial across sub-Saharan Africa and, to
various degrees, has helped to catalyse private funds. In many cases, the presence of DFIs,
providing financing and risk mitigation measures, has been critical to obtain financing.
Further commitments are expected in the coming years.

However, while public financing looks set to continue to play an important role, closing the
very large investment gap requires a much bigger role for private financing: there are limits
to what governments can do, given their fiscal constraints, and state-owned utilities are
mostly in a weak financial position. Attracting larger amounts of private funds requires
policy and regulatory improvements in the region, as well as project-specific measures to
reduce investment risks. Such improvements could increase the catalytic effect and allow
for a more effective use of public funds.
3.9 Closing the investment and financing gap

3
This section highlights four priority areas that will be vital to address to reduce risk
perceptions, to obtain more and cheaper financing, and to bring new actors to the power
sector.
3.9.1 Improve the financial and operational performance of utilities

Utilities in sub-Saharan Africa have high transmission and distribution losses (Figure 3.20).
This, combined with tariffs below costs and low collection rates, results in utilities being
generally short of cash and hampers their ability to raise funds. It is estimated that only
19 out of 39 utilities in sub-Saharan Africa earned enough revenues to cover operational
expenses, and only four of these covered at least half of their capital expenses (Kojima,
2016). As utilities are the main counterpart to private investors in generation, this situation
can raise concerns on the part of those investors about future payment and makes it more
difficult to secure financing at low cost.
Figure 3.20 ⊳ Electricity network losses versus cost recovery ratio for major
utilities in selected markets
1.3
Cost recovery ratio
Malaysia
1.2
United States
Korea
1.1
Thailand
China France Viet Nam Brazil
1.0
Other sub-Saharan Africa

0.9
South Africa
Mexico India
0.8
0% 5% 10% 15% 20% 25%
Network losses
The weak financial and operational performance of utilities in

sub-Saharan Africa hampers affordable financing in the power sector
Note: IEA analysis with calculations for cost recovery based on financial statements of reference utilities in
each market.

Strengthening the governance framework of utilities is critical to improve operational and
financial efficiencies. The World Bank study estimated that 11 utilities in the region could
become financially viable if network losses dropped to 10%, cash collection rates increased
to 100% and staff ratios matched those of efficient utilities in other regions (Kojima, 2016).
Reducing network losses requires setting feasible targets, robust planning and a clear
action plan to invest in infrastructure. Getting this done may come with challenges but
there are positive examples in the region (Box 3.4). Moving towards cost recovery, which
may require subsidies or cross-subsidisation, is also necessary to increase the pace of
investment by easing perceived counterparty risks and allowing for increased financing at
lower cost.
Box 3.4 ⊳ Improving performance of a distribution utility: lessons from Uganda
The Government of Uganda initiated reforms in 1999 to unbundle the state-owned

utility, Uganda Electricity Board. IPPs were introduced and the government awarded a
concession to operate and maintain the generation assets. A state-owned transmission
company was created and made responsible for planning, procurement and operation.
Umeme, a private consortium, won a 20-year concession to operate and maintain the
network.
Improvements in operations were slow during the first few years of the concession, but
Umeme was able to reverse the situation. Network losses halved from 38% in 2005 to
17% in 2018, driven by an increase in annual investment from an average of $16 million
in the 2005-09 period to $81 million in the 2014-18 period, and an improvement in the
power supply. In addition, the number of customers multiplied by four while collection
rates increased by 20 percentage points (Figure 3.21).
Key factors included:
 Contract-based performance indicators. Indicators included loss reduction targets

and investment obligations ($65 million by the end of the fifth year).
 Regulatory independence. The government agreed that the regulator would set
annual tariff adjustments based on a methodology defined in the concession
contract.
 Commercial efficiencies. Increased channels to pay bills (including mobile
payments) and the roll-out of prepayment metering made a difference (which in
2018 represented 24% of revenues).
 Technical support from international donors.
 Various risk mitigation mechanisms established with DFI support. The security
package included a payment guarantee and insurance to cover termination and
other political risks.
The process was not always smooth. In 2006, the government and Umeme
renegotiated the contract after a power crisis (one of the two original investors left the

concession at this point). Improvements in electricity access were slow and, although
access has increased recently, the percentage of those with access remains low (around
11% in rural areas). Quality of electricity supply also remains an issue for customers
despite the reduction in losses.
Figure 3.21 ⊳ Transmission and distribution network losses, collection rates

and annual investments in Uganda, 2005-2018
Network losses Collection rates Annual investment

50% 100% 100 3
Million dollar (2018)

40% 80% 80
30% 60% 60
20% 40% 40
10% 20% 20
2005 2018 2005 2018 2005 2018
After a period of slow progress, the private distribution company reduced network
losses and increased collection rates, which supported increased investment
Note: Collection rates surpass 100% due to pre-paid metering.

Sources: IEA analysis based on World Bank (2014) and Umeme (2018).
3.9.2 Enhance policy and regulatory frameworks to improve bankability

Robust procurement frameworks and well-designed contracts are crucial for project
bankability. Competitive procurement is picking up in sub-Saharan Africa and is attracting
strong interest from investors. Excluding South Africa, which largely acquires independent
power projects through competitive tenders, half of the privately-financed IPP projects that
reached financing in 2014-18 were competitively awarded (Figure 3.22).
Designing and conducting competitive tenders and auctions requires technical expertise
and can take longer than direct negotiations. However, well-designed auctions bring a high
degree of transparency and predictability, enhance market confidence and facilitate price
discovery. Bid prices for solar PV under the REIPPP decreased by 80% between 2014 and
2018, while a programme to procure utility-scale solar PV in Zambia and Senegal together
attracted almost 100 applicants and brought record low prices for the region of $48/MWh
in 2017 and $43/MWh in 2018.
A key feature to ensure that procurement programmes translate into investments at scale
is the bankability of the underlying contracts. Successful procurement programmes are

accompanied by power purchase agreements that clearly define risks and responsibilities,
e.g. clauses on dispute resolution, force majeure and termination. Credit enhancement
mechanisms such as escrow accounts or public guarantees may also be necessary to
mitigate payment risks and increase utilities creditworthiness. For example, the tenders in
Zambia and Senegal had both sovereign and DFI-backed guarantees. Maintaining
predictable, clear policies throughout the process is also important to preserve interest
from private investors and lenders.
Figure 3.22 ⊳ IPP capacity awarded by type in sub-Saharan Africa

(excluding South Africa), 2014-2018
100%
80%
60%
40%
20%
2014 2015 2016 2017 2018

Competitive process Direct negotiation
Competitive procurement is increasing in sub-Saharan African countries,

though almost half of privately-financed capacity was awarded by direct negotiation
Sources: IEA analysis based on World Bank (2019a).
3.9.3 Create supportive enabling environments for rural electricity access

As discussed in section 3.4, reaching access targets requires a combination of on-grid and
decentralised solutions. Scaling up investments in decentralised solutions may come with a
variety of challenges, many of which evolve around revenue and regulatory uncertainty.
Supportive policies, as well as low-cost financing from DFIs, foundations and impact
investors i.e. those that invest in projects that have development benefits, have fostered
private-led projects, but revenue uncertainty still presents a major challenge, especially as
much of future electrification will take place in more rural and generally poorer areas
(Table 3.4). Mini-grid developers cannot recover the high upfront investments if customers
consume little, while retailers of solar home systems may need to anticipate longer
repayment periods and higher default rates from the customers they provide loans.
Consumers may be restricted by their ability to pay for electricity.

Table 3.4 ⊳ Main risks and their underlying causes in deploying mini-grids
and solar home systems
Mini-grids Solar home systems
Revenue risk
Low demand Inability/delay to recover high upfront Low sales due to limited ability to
investment due to electricity demand lower pay, restricting demand to
than expected (over-sized mini-grid). low-end solar home systems.
Low affordability Customers with low and unpredictable income.
Tariff level and Dependence and uncertainty regarding Prices of solar home systems are 3
subsidies subsidies (especially if tariffs required to be generally unregulated, but
set at national uniform levels); difficulty to developers may face uncertainty
maintain support for and collect cost regarding regulation of subsidies
recovery tariffs (high compared to the grid), (when applied), dependence on
if allowed tariffs not capped. mobile services and regulation of
interest rates of loans.
Regulatory risk
Registration and Unclear rules on licensing and registration of Generally none.
licensing assets and delays to obtain such permits.
Tariff setting Incomplete/unpredictable tariff setting N/A
methodology.
Delays to obtain tariff approvals.
Interaction with Weak/incomplete specifications of what N/A
central grid happens when the central grid arrives to an
area where a mini-grid operates (e.g. mini-
grid becomes SPP or SPD; financial
conditions in case of asset buy-out by utility).
Note: N/A = risk does not arise given technological and commercial characteristics; SPP = small power
producer; SPD = small power distributor.
A study in rural Rwanda shows that households that received a free small PV kit used it
intensively and reduced their kerosene and energy consumption: it also found that children
studied longer (Grimm et al., 2016). Other studies also support the hypothesis that
consumers are cash and credit constrained, and that social benefits, when fully
internalised, exceed the investment costs. This points to the need for some sort of
government or public support to realise these benefits.
Electricity subsidies, or similar financing mechanisms, could help rural households

overcome the affordability constraint. They could also increase the sustainability of the
decentralised electricity sector and encourage private companies to expand to more rural
areas. Subsidies could be provided to households in the form of lower tariffs or help with
connection costs or they could go to developers in the form of grants for capital expenses
or concessional financing. Whatever option is chosen, subsidies need to be clear,

predictable and well targeted.

Even if subsidies are expanded successfully, increased consumption will still be critical.
Annual electricity demand per person in sub-Saharan Africa currently stands at around
190 kWh (excluding South Africa). This is one of the lowest levels of demand in the world.
In some countries, increasing electricity access has led to increasing consumption as well,
but at lower rates. For example, while access grew at an annual rate of 3.5% in Ghana
between 2000 and 2018, per capita consumption grew by 1.5% per year. In Kenya, the
growth in the access rate was four-times the growth in per capita consumption. Policies to
increase productive uses and higher industrialisation could help reverse this trend.
Those countries where private mini-grid developers are most active, such as Tanzania,
Nigeria, Kenya and Rwanda, are also those that have the best-developed regulatory
frameworks. A strong and well-articulated regulatory framework that is clear about the
most important issues will help to attract private investors. The issues that need to be
covered include tariffs levels, subsidies and tariff setting; regulation of entry; and what
happens when the central grid arrives. Tanzania’s mini-grid regulation provides four
alternatives on this last point: mini-grids can become small power producers (SPPs) selling
electricity to the grid; they can become small power distributors (SPDs) buying electricity
from the grid; they can combine the two (SPP+SPD); or they can sell the mini-grid assets to
the utility. Lack of clarity over compensation issues, and concerns about enforcement of
the regulation still appear to be causing concern to developers.
3.9.4 Strengthen provision of long-term finance

Given the long-lived and capital-intensive nature of power projects, the availability of long-
term finance is crucial for power sector investment. In most of sub-Saharan Africa,
however, access to long-term finance is severely constrained. It relies heavily on
international development finance. Given the substantial risks associated with currency
fluctuations, the local financial sector has a central part to play in ensuring a steady flow of
long-term financing to power projects: a mismatch between revenues in local currency and
costs in foreign currency (for equipment, borrowing, prices for power purchase
agreements) can weigh heavily on the finances of state-owned utilities. While access to
local banks in sub-Saharan Africa expanded over the past decade, it still compares
unfavourably with access in other developing economies, with the exception of South
Africa; and the majority of loans are still for short-term investments (Figure 3.23).
Developing the local financial sector and its ability to extend long-term finance has the
potential to make a big difference to secure private investment in the power sector. DFIs
can help by acting as a catalyst, for example by providing guarantees, refinancing or on-
lending mechanisms. The refinancing of the Kenya Power and Lighting Company, the
company that owns and operates the majority of the electricity network in Kenya, is a good
example of how DFIs can strengthen the role of local banks and help utilities access
cheaper and longer term finance ($500 million of commercial debt was restructured for
longer term and lower cost commercial debt). Domestic pension and sovereign wealth
funds could also play a more important role in financing power investments. Senegal's

Sovereign Fund for Strategic Investments, FONSIS, which has provided equity for solar PV
plants in Senegal, is leading the way.
Figure 3.23 ⊳ Level of private credit and loan maturity of the local banking
sector in sub-Saharan Africa, 2016-2017
Private credit to GDP Loan maturity structure (West Africa)

160% 100%
120% 75%
3
80% 50%
40% 25%
SSA Latin Southeast South Short-term Medium-term Long-term

America Asia Africa
The local financial sector is playing a limited role in power sector financing other
than in South Africa; the provision of long-term finance is particularly constrained
Notes: SSA = sub-Saharan Africa (excluding South Africa). Long-term loan has a maturity more than five
years; medium-term loan between one and five years; and short-term loan less than one year.
Sources: IEA analysis based on World Bank (2019b) and BCEAO (2018).
Domestic policies outside the power sector also matter. Policies on issues such as the
repatriation of funds, tax incentives and the regulation of public-private partnerships all
affect the overall enabling environment and the regulatory framework for financiers. Clear
economic policies that are conducive to private sector participation have an important role
to help scale up power sector investment in Africa.

Chapter 4
Natural gas and resource management

New horizons for Africa’s resources?
S U M M A R Y
• Africa is endowed with abundant oil, gas and mineral resources and these have
provided an important source of income for the continent’s economic growth. But
changing energy market dynamics offer different prospects for each fuel. Oil
production reaches 8.2 million barrels per day (mb/d) by 2040 in the Stated Policies
Scenario, just shy of today’s level (after a dip in the 2020s); gas production doubles
between 2018 and 2040; and coal production remains at today’s level.
• Africa also has many of the metals and minerals that are critical for clean energy
technologies. It accounts for two-thirds of global cobalt production, 80% of platinum
and half of manganese production. Responsible development of these resources is
crucial to support the continent’s economic prosperity and global energy transitions.
• Natural gas is facing a potential turning point in Africa. Outside North Africa, natural
gas has not so far played a major role in energy development – at 5%, the share of
gas in the energy mix in sub-Saharan Africa is one of the lowest in the world. The
future looks likely to be different: recent discoveries across the continent could fit
well with Africa’s push for industrial growth and its need for reliable electricity
supply. Developing gas infrastructure however will be a major challenge given
generally small market sizes and concerns about affordability.
• Four case studies are presented to illustrate the differing dynamics for gas across
the continent. Nigeria is an incumbent producer that has struggled to develop
domestic gas consumption. Egypt is a resurgent producer with extensive domestic
infrastructure that has successfully managed to revive upstream activity.
Mozambique and Tanzania are emerging producers, thanks to recent major
discoveries, but face the challenge of getting domestic value from gas. Ghana is
short of gas and seeking access to liquefied natural gas (LNG) imports.
• In the Stated Policies Scenario, gas demand in sub-Saharan Africa triples to over
100 billion cubic metres (bcm) by 2040. Production across the region grows even
more rapidly as sub-Saharan Africa becomes a major supplier of gas to international
markets. In our Africa Case, both production and demand rise further.
• Developing domestic markets is likely to see traditional pipelines complemented by
small-scale and distributed approaches in some areas. Oil use equivalent to some
10 bcm (30% of today’s gas demand in sub-Saharan Africa) can already be displaced
by small-scale LNG with today’s costs and prices. Bringing gas into the energy system
is a challenging task, and getting these new value chains up and running would
require a concerted effort from Africa’s decision makers.
Chapter 4 | Natural gas and resource management 155

• Many resource-holders in Africa have not yet capitalised on their resource
endowments in a way that supports economic and social growth. Changing global
energy dynamics are likely to put further pressure on production and on
development models that rely on hydrocarbon revenues. This underscores the need
for transparent resource management as well as efforts to reform and diversify the
economies. Given the importance of resources to Africa’s development plans, we
highlight three strategic responses that could help mitigate the risks and support
responsible development.
• The first is to ensure competitive investment frameworks. Recently there has been a
global shift towards upstream investment with shorter lead times and a more rapid
return of capital. Although there are some examples of investments of this kind in
Africa, in many cases the conditions for investors are out of step with this trend, and
this could weigh against decisions to put capital into projects in Africa. This makes it
all the more important that clear regulatory frameworks are in place and that the
role of national oil companies is clearly defined.
Figure 4.1 ⊳ Annual average net income from oil and natural gas
production by scenario in sub-Saharan Africa
Oil Natural gas

120
80
40
2010-18 STEPS AC LRC 2010-18 STEPS AC LRC

2019-40 2019-40
Africa faces significant challenges in sustaining net income from oil production,
while natural gas offers more stable sources of revenue
Note: STEPS = Stated Policies Scenario, AC = Africa Case, LRC = Lower Revenue Case.
• The second is to develop the infrastructure required to bring resources to African

consumers. This requires strategic choices on refining capacity and distribution
networks. The third is to ensure that the revenue garnered from oil and gas is
managed wisely. Average annual net income from oil and gas in sub-Saharan Africa
amounts to $140 billion over the outlook period, but reduces sharply by 36% in a
Lower Revenue Case in which global oil demand and prices are substantially lower as
a result of faster energy transitions. In all cases there is a major shift towards less
lucrative (per unit of energy) but potentially more stable revenues from gas.

4.1 Introduction
Africa has abundant oil, gas and mineral resources, and the revenue that these resources
have generated has been an important source of income and economic growth. Oil and gas
exports brought around $1.7 trillion of net income to African producers during the
commodity boom in the 2000s, and the resource industry contributed around a quarter of
Africa’s economic growth between 2000 and 2008 (McKinsey, 2010). However, this income
has also been a source of corruption and in many cases it has hindered broad-based
development. Africa’s resource producers remain among the least diversified economies in
the world, and their economic prospects remain tied to the volatile movement of global
commodity prices. The plunge in oil prices in 2014 brought these structural weaknesses
into sharp relief. Many producers experienced a significant drop in export revenue (and
fiscal capacity) and investment into Africa’s upstream sector was severely curtailed. Oil
prices have started to rise again in recent years, but changing energy dynamics make it
4
risky to assume that ample resources will translate into reliable future revenues.
The challenges are particularly formidable for oil. Producers face both rising competition in
global markets and growing uncertainty over long-term demand, and issues such as weak
regulatory environments, political and social instability and the lack of local supply chain
and technical expertise tend to undermine the competitiveness of African resources.
Producers need to make considerable efforts to resume output growth and position
themselves competitively in global export markets. There is also an imperative for both
incumbent and emerging producers to take a hard look at how best to use the revenue
from resource development to support the broader development of their economies. In
the Stated Policies Scenario, the reduction in upstream investment since the oil price
downturn puts the continent’s oil production on a downward trajectory until the mid-
2020s. Production resumes afterwards, but remains below today’s levels through to 2040.
In the Africa Case, higher domestic demand and improved resource governance lead to
higher production, but net exports of oil remain well below today’s levels (Table 4.1).
The story is different for natural gas. Gas takes a growing share in the global energy system
in all of the IEA scenarios. Helped by a series of major discoveries in recent years, gas has a
potentially important role to play in Africa’s energy mix as a source of reliable baseload
energy and as a companion for the rapid growth of renewables. It is however likely to be
challenging to build infrastructure that makes the gas available and affordable in domestic
markets. In the Stated Policies Scenario, Africa’s gas production increases twofold in the
period to 2040 and it rises further in the Africa Case where the potential for using gas in
power and industry is exploited. Gas production is relatively more resilient in a Lower
Revenue Case than oil production, offering a more stable source of income over the period.

Table 4.1 ⊳ Fossil fuels demand, production and net trade in Africa
by scenario
2000 2018 2025 2030 2035 2040 2030 2040
Oil (mb/d)
Demand 2.2 3.9 4.9 5.5 6.2 7.0 6.4 7.8
Production 7.8 8.4 7.9 8.0 8.1 8.2 8.4 8.8
Nigeria 2.2 2.1 2.1 2.1 2.2 2.3 2.3 2.6
Libya 1.5 1.0 1.0 1.1 1.3 1.5 1.2 1.6
Angola 0.7 1.5 1.3 1.3 1.2 1.2 1.3 1.4
Algeria 1.4 1.5 1.3 1.3 1.3 1.3 1.3 1.2
Net exports 5.4 4.2 2.8 2.2 1.5 0.8 1.8 0.6
Natural gas (bcm)
Demand 58 158 185 221 265 317 238 349
Production 124 240 287 372 435 508 407 561
Algeria 82 96 96 104 112 125 103 111
Mozambique and Tanzania 0 5 21 61 82 105 70 130
Egypt 18 59 81 92 95 98 93 101
Nigeria 12 44 41 45 56 65 56 84
Net exports 67 81 102 151 169 190 169 212
Coal (Mtce)
Demand 129 160 166 161 160 161 153 148
Production 187 225 217 199 210 221 196 198
South Africa 181 209 198 174 176 173 171 148
Mozambique 0 11 13 18 24 32 18 34
Net exports 59 66 52 39 50 60 43 51
Notes: mb/d = million barrels per day; bcm = billion cubic metres; Mtce = million tonnes of coal equivalent.
Net exports = domestic production + refinery processing gains – demand including international bunkers.
Against this backdrop, this chapter explores two key issues that are critical to shaping the
future of African resources:
 The role of natural gas in Africa’s energy mix: We look at the strategically important
role of natural gas on the continent with the help of four case studies featuring
Nigeria, Egypt, East Africa (Mozambique and Tanzania) and Ghana. The section also
explores how recent discoveries could affect the position of gas in Africa’s energy mix.
 Maximising the value of Africa’s resources: We examine the outlook for resource
development and related revenues in Africa under different scenarios. Despite their
vast resource endowment, many African governments have been unable to capitalise
on opportunities to support growth. This section discusses the strategies available to

resource-holders to mitigate risks and ensure that resources are used to support broad
economic and social goals.

4.2 The role of natural gas in Africa’s energy mix
The position of natural gas in Africa’s energy mix today varies widely across the continent.
In North Africa, gas is a mainstream fuel that meets around half of the region’s energy
needs. In 2017, with strong growth in Algeria and Egypt, gas consumption in North Africa
overtook oil use for the first time in history. However, the picture is very different in much
of sub-Saharan Africa, where gas has been a niche fuel. The share of gas in sub-Saharan
Africa’s energy mix is around 5% – the lowest regional share in the world.
There are a number of reasons for the low penetration of gas in sub-Saharan Africa. In
many cases, there is a considerable distance between production and consumption
centres, necessitating large-scale, capital-intensive infrastructure. Except in Nigeria and
Angola, there has been relatively little domestic production, and the commercial case for
importing gas has generally been weak. Even in countries with significant gas resources, like 4
Nigeria, it has proved difficult to align interests, build infrastructure and maintain reliable
supply along the value chain from producer to end-user: existing gas-fired plants have been
underutilised, and there have been periodic power outages.
There are nevertheless reasons to believe that the future of natural gas in Africa may be
different from the past:
 Africa’s evolving energy needs: Gas could be a good fit for Africa’s push for industrial
growth as well as a suitable partner for a rapid expansion in the role of solar
photovoltaics (PV) in electricity generation.
 Scope to displace costly oil products: In 2018, some 15% of electricity in sub-Saharan
Africa (excluding South Africa) was generated using oil products such as diesel or heavy
fuel oil.1 These are mostly back-up generators used in industry to avoid the risk of
unreliable power supply. At current prices there is scope in many cases for gas to offer
a cheaper alternative.
 Major gas discoveries in every part of the continent in recent years (Figure 4.2): The
immense finds in East Africa (Mozambique and Tanzania) in recent years have been
followed by further discoveries in Egypt and off the coast of West Africa on the
maritime border of Mauritania and Senegal, and by the discovery of gas condensate
resources in South Africa in 2019. These discoveries could have a significant influence
on the outlook, especially since – with the exception of southern Africa – the continent
does not have large resources of coal.
 Favourable outlook for gas importers: A wave of new liquefied natural gas (LNG)
export capacity is coming online and exporters are keen to find a new market for their
gas. Gas prices in the key importing regions have plummeted, while growing liquidity
and flexibility in LNG markets are helping ease concerns over security of supply.
1
In 2017, the share of oil in power generation was around 35% in Angola and almost 90% in Senegal.

 Innovation in LNG technology: The development of new technologies such as floating
storage regasification units (FSRU) and small-scale technologies offers more flexibility
for current and potential future gas users, and this could boost demand for gas. FSRUs
can reduce the need for more costly onshore gas infrastructure and there is scope for
them to be redeployed when no longer needed. Small-scale LNG technologies can help
to provide new sources of demand and thus make gas less dependent on the
realisation of complex onshore infrastructure projects.
In addition to helping to provide energy in producing countries, natural gas can contribute
to economic growth by providing a sizeable source of fiscal revenue, although the extent to
which it contributes to growth depends on the revenues being used effectively and
transparently (see section 4.3).
Figure 4.2 ⊳ Natural gas resource discoveries, demand and production in

selected countries in Africa
70 Natural gas production

Natural gas demand 2018 (bcm)
60 50 bcm
Algeria Egypt
50
40
30
Nigeria
20
10 Côte South Africa Senegal and

d'Ivoire Tanzania Mauritania Mozambique
0 Ghana
0 2 4 6 8 10 12 14
Resource discovery 2011-19 (tcm)
With the exception of Egypt, recent gas discoveries in Africa
have been in countries with very small gas markets
Notes: bcm = billion cubic metres; tcm = trillion cubic metres. Bubble size represents production volume in
2018.
The outlook for natural gas to 2040 in the Stated Policies Scenario varies widely according
to resources, market conditions and policy preferences in different countries. In this
analysis, we consider four sets of circumstances:
Incumbent producers: This designation applies to Nigeria and Algeria, both of which are
exporting around half of their gas production to global markets. The policy priority for
these countries is to sustain production levels and stay competitive in export markets.
Unlike Algeria, where gas plays a significant role in the energy mix, the penetration of gas in
Nigeria is low compared to its population and resources. Nigeria therefore faces the
longstanding question of whether it can develop domestic gas demand.

Resurgent producers: Egypt is a good example of a country that has well-developed gas
infrastructure, but where gas production is recovering from a prolonged downturn. The
policy priority in this case is to accelerate production growth to serve domestic demand
and develop strategies to maximise the value of its resources.
Emerging producers: This applies to countries where there is significant resource potential
but where both production and demand are small today. Following their recent major gas
discoveries, Mozambique and Tanzania are at the forefront of this group, but it also
includes Senegal and Mauritania. For these countries the first task is to turn discoveries
into viable and successful commercial projects. Given the strong export orientation of the
planned projects, they need to be competitive against other sources in global LNG markets
if they are to succeed. A second task is to develop domestic gas markets where it makes
sense for them to do so.
Gas importers: There are many countries with limited resources and so – if gas is to play a
4
role in their energy future – they need to rely on imports either in the form of gas or gas-
based electricity. While many African countries belong to this group, Côte d'Ivoire and
Ghana are the ones that are most actively exploring import options (although Ghana has
some domestic production notably from the Jubilee, Sankofa and TEN fields). South Africa
has traditionally belonged to this group and imports gas from Mozambique, but this might
change if recent offshore discoveries prove to be sufficiently promising. For these countries
the key task is to obtain the gas they need at competitive prices while ensuring security of
supply.
In this section, we look at the prospects for gas in each of these segments.
4.2.1 Prospects for gas in key regions

Incumbent producer: the case of Nigeria
Nigeria has an estimated 15 trillion cubic metres (tcm) of natural gas resources, which is
more than any other African country except for Algeria. Gas accounts for around 10% of
total primary energy demand today, mostly for power generation and own use in the oil
and gas industry. However, the current outlook for Nigeria’s gas industry is far from bright.
Rapid production growth after 2000 tailed off due in part to regulatory uncertainties and
the country is now struggling to arrest a decline in output. A shortage of domestic gas
supply has severely affected the reliability of power supply, leading to load shedding and
growing reliance on private (diesel-based) generators. Exports via the West African Gas
Pipeline have been subject to frequent interruptions, and that has caused difficulties for
neighbouring countries such as Ghana, Benin and Togo. Meanwhile, almost 15% of gross
production is wasted through flaring, incurring both economic and environmental costs.
Upstream activity is far below a level commensurate with the country’s resource base. The
slump in investment, related in part to lower oil prices since 2014, is damaging for the
medium-term outlook – gas production stalls through to the mid-2020s in the Stated
Policies Scenario. One of the key issues is uncertainty over the fiscal conditions, exemplified
by nearly two decades of uncertainty around the key provisions of the Petroleum Industry

Bill, which is designed to overhaul the legislation governing the operation of the oil and gas
industries in Nigeria. Without clarity on governance and regulation, many companies will
continue to rein in spending on new projects, with implications not only for Nigeria but also
for adjacent countries that depend on exports from Nigeria for their gas supplies.
Reducing gas flaring would help to increase production. Nigeria has made notable progress
in reducing flaring – the amount of gas flared has fallen by 70% since 2000 – but the
country remains the seventh-largest gas flaring country in the world, and the value of the
gas flared is estimated to be some $1.8 billion in 2018. Flaring is also a significant source of
carbon dioxide (CO2) emissions and incomplete flaring releases methane to the atmosphere
as well. Despite the government’s goal of eliminating flaring by 2020, the progress has
stalled since 2016. Strengthened regulations and adequate gathering, processing and
transportation infrastructure to bring associated gas to markets are essential to realise the
government’s target. In the Stated Policies Scenario, it is assumed that the envisaged
reforms are gradually implemented, that output starts growing again from the late-2020s,
and that Nigeria’s annual gas production in 2040 rises 50% above today’s level to 65 bcm.
The outlook for gas production also depends on reform of the electricity sector. Producers
in Nigeria have domestic supply obligations that require them to supply a certain volume of
gas to domestic markets. These obligations have typically not been met in full. Below-cost
power tariffs and the precarious financial situation of electricity generation and distribution
companies have led to frequent non-payment. The poor condition of the gas transmission
and distribution system is also a major constraint. Without reforms to the power sector as
well as the upstream, there is no guarantee that higher production would lead to improved
supply of gas (and power) to the country.
Figure 4.3 ⊳ Natural gas production and use by sector and by scenario in
Nigeria
100
bcm
Oil and gas

industry own-use
80 Other uses
60 Power generation
40 Industry
Exports
20
2018 STEPS AC STEPS AC

2030 2040
Accelerated upstream reforms and industrial growth mean that in 2040 gas use and
production are 40% and 30% higher in the Africa Case than in the Stated Policies Scenario
Notes: STEPS = Stated Policies Scenario, AC = Africa Case.

While the challenges are formidable, realising the potential of gas could bring significant
benefits. In the Stated Policies Scenario, electricity demand in Nigeria grows at rates in
excess of 6% per year in the period to 2040, necessitating a significant increase in
generation. Given the high share of gas in both existing and planned power generation
capacity, using additional gas looks to be a cost–effective way of providing much-needed
electricity, alongside the anticipated ramp-up of investments in renewables (from a very
low base). Attracting more private capital to the sector will be essential if this is to happen:
the recent 460 megawatt (MW) Azura-Edo project, Nigeria’s first project-financed
independent power producer project, could be an important signal in this context. Nigeria
is also aiming to foster gas-based industries (for example fertiliser, methanol) to substitute
domestic production for imports and to position the country as a regional hub for
manufacturing, a key element in our projections for gas demand in both the Stated Policies
Scenario and the Africa Case. Gas demand in Nigeria rises rapidly in the latter part of the 4
projection period, reaching 30 billion cubic metres (bcm) in 2040 in the Stated Policies
Scenario and over 40 bcm in the Africa Case (Figure 4.3).
Resurgent producer: the case of Egypt

Gas production in Egypt has undergone dramatic changes since the early 2000s. Domestic
output grew by 17% per year on average between 2000 and 2008 (when production
reached a peak of 62 bcm) and Egypt became an exporter of gas. However, a significant
reduction in investment resulted in a 40% drop in production between 2008 and 2015. The
country became a net importer of gas again in 2015, chartering two FSRUs in order to be
able to bring in LNG imports. The Egyptian economy is heavily dependent on gas: more
than 80% of the country’s power generation capacity is gas-fired. Declining domestic
output therefore caused repeated power outages and weighed heavily on industrial
competitiveness. LNG export facilities were idled, and more polluting oil products started
to take market share.
The discovery of the large Zohr offshore gas field in 2015 – one of the biggest finds
worldwide over the last decade – changed the situation. With favourable upstream policies
to expedite development, production from the Zohr field started in late 2017 and is set to
reach around 30 bcm in 2019. This growth is now being supplemented by production from
several other fields, notably Nooros, Atoll and the first and second phases of the West Nile
Delta complex, leading to a major turnaround in the country’s production. Gas production
in 2018 returned to the level of the previous peak in 2008 and Egypt achieved self-
sufficiency later in the year.
With sustained upstream reforms and efforts to reduce arrears to international operators,
gas production in Egypt grows to around 100 bcm by 2040 in the Stated Policies Scenario.
The upbeat production outlook, coupled with the country’s underutilised LNG export
infrastructure, opens the possibility of Egypt going well beyond self-sufficiency and acting
as a regional export hub, although this would require the resolution of various political and
commercial issues. However, question marks remain as to Egypt’s net export position in the
longer term. On the supply side, there would be need for continued upstream investment

as the outputs from the Zohr and adjacent fields reach a plateau.2 But the bigger issue is
that gas demand in Egypt may rise very rapidly. Egypt is already the largest gas consumer in
Africa and there is strong potential for further growth, especially in the power sector where
gas is the dominant fuel.
Gas pricing is a key variable in determining the outlook for consumption. Although the
government made a notable upward revision to domestic gas prices in 2014 in response to
tightening supply, prices paid by power generators (around $3 per million British thermal
units [MBtu]) remain below the levels to incentivise new supply investment, estimated to
lie in a range between $4-6/MBtu (MEES, 2018). Prices for the petrochemical industry are
within that range ($4.5/MBtu) (OIES, 2018). In contrast, prices for steel and cement
producers are set at $7- 8/MBtu, and this has triggered fuel switching away from gas to
coal. Earlier this year the government announced a plan to implement automatic price
indexation for oil products, but gas prices for power generation are still being subsidised. A
further reform of gas pricing is needed to maximise the value of the country’s resources. To
be effective this should cover both the upstream and the end-user, and it would be worth
giving consideration as part of any reform package to the case for transparent end-user
pricing schemes including clear rules of price discrimination by sector.
Emerging producers: Mozambique and Tanzania cases

East Africa’s gas resources are impressive, with up to 5 tcm in Mozambique and nearly
2 tcm in Tanzania. Commercialising this significant resource base is a priority for both
countries but this would require unprecedented capital investment (in Mozambique it
would far exceed the country’s annual gross domestic product [GDP]). This points to the
need for a regulatory framework that serves domestic development priorities while
remaining attractive for foreign investors.
Mozambique is taking the lead in East African natural gas development. Several projects
are moving forward with a strong export orientation given the importance of economies of
scale. Coral LNG, the first floating LNG project in Africa, is being built with an aim of starting
operations in 2022: BP has committed to take all of the LNG that it produces into its export
portfolio. The Anadarko-led Mozambique LNG, the country’s first proposed onshore LNG
terminal, would involve larger volumes of gas: a final investment decision (FID) was
reached on this project in 2019, with a number of offtake agreements oriented toward
Asian markets.3 Another project, Rovuma LNG led by Eni and ExxonMobil, has secured
sufficient offtake commitments from affiliated buyers to move ahead. Its development plan
has received government approval and it is approaching a FID. The LNG project in Tanzania,
however, has been held up by regulatory delays: the government now expects the project
to start construction in 2022 and come into operation from the late-2020s.
2
Trade with other East Mediterranean countries (e.g. imports from Israel, exports to Jordan) can also impact
the trade balance.
3
Total will replace Anadarko as a leader for the Mozambique LNG project following the merger.

In spite of the gas resources being offshore, development costs for the relevant fields and
export facilities are potentially modest. Proximity to India and other fast growing Asian
markets is another plus. However, the projects are expected to start operation at a time
when global gas markets are very competitive, with many new and established exporters
looking to gain or strengthen a foothold in the market. The delivered costs of gas to Asia for
these projects are estimated to be broadly similar to those of projects in other emerging
gas exporters (e.g. Canada, Australia). However the remote location, lack of established
infrastructure and unfavourable security conditions create a risk of cost overruns which
could significantly undermine the competitiveness of the projects. Strict control of costs
and schedules is therefore very important (Figure 4.4). In the Stated Policies Scenario, gas
exports from Mozambique reach nearly 75 bcm by 2040 (including exports to South Africa
via pipeline) while those from Tanzania reach around 20 bcm.
Figure 4.4 ⊳ Required levels of liquefaction capital cost and feedstock gas
4
costs in East Africa by delivered prices to Asia
2 000
Cost of capacity (dollars per tonne)
1 500
1 000
500
0 1 2 3 4 5 6 7 8
Cost of feedstock gas (dollars per MBtu)
Strict cost and schedule control is indispensable for East African LNG
to secure its place in global LNG markets
Notes: MBtu = million British thermal units. Delivered prices to Asia are the sum of the costs of developing
gas resources, building liquefaction terminals and shipping the LNG volumes to Asia. Assumed asset lifetime
is 30-years with a cost of capital in the range of 8%.
Although Mozambique and Tanzania’s gas resources are primarily earmarked for export,
governments in both countries are keen on developing a domestic gas industry. Domestic
market obligations have been an element of discussion between the gas industry and the
government with the design of the policy (how much and at which price) being a critical
factor for both sides. The biggest hurdles for domestic gas consumption growth are lack of
infrastructure and relatively low purchasing power of end-users.
Mozambique’s gas resources are in the remote and sparsely populated north, and bringing
the gas to the cities in the south would require costly pipeline infrastructure. This is under
consideration (as are short-haul LNG shipments), but there is a major question mark on the

economics. The development of local gas demand hubs served via FSRUs would require less
capital expenditure and may prove more flexible. “Gas-by-wire” options4 could also lower
the costs of infrastructure investment, while large gas consuming “anchor” industries could
play an important role in underpinning the economics of infrastructure projects. Many
projects (including projects to build fertiliser, methanol and gas-to-liquids plants) have
already been proposed as candidates to support an initial commercial case for developing
the infrastructure.
Tanzania is in a slightly more favourable position in terms of getting gas into its domestic
market: some of its gas fields are onshore and relatively close to Dar es Salaam, and there is
already a pipeline which could potentially be expanded. There is a strong economic case for
using gas to displace oil-fired generation: Tanzania’s Gas Master Plan sets out a strategy to
promote the use of gas to displace traditional uses of biomass, spur industrial growth and
nurture gas-based industries. A plan to export Tanzanian gas to Kenya is also being
explored. There is however more uncertainty on the upstream side about whether and
when projects might move to a FID (and construction).
In the Stated Policies Scenario, domestic gas consumption reaches around 15 bcm in
Mozambique and 6 bcm in Tanzania in 2040, roughly 20% of each’s country’s total output.
In the Africa Case, gas makes further inroads into the energy system, with the combined
gas demand in the two countries reaching almost 35 bcm by 2040 (Figure 4.5).
Figure 4.5 ⊳ Natural gas consumption and export by scenario in

Mozambique and Tanzania
Mozambique Tanzania
120
bcm
Exports
Domestic
80 consumption
40
2018 2030 2040 2040 2018 2030 2040 2040

STEPS AC STEPS AC
Gas production in East Africa grows substantially in the period to 2040:
the vast majority is exported as LNG

4
Gas plants are built near coastal areas that have good access to LNG and electricity networks are extended
to wider areas.

East Africa’s gas industry, if successfully developed, has the potential to be a major
contributor to long-term economic growth: increased exports would yield cumulative net
fiscal incomes amounting to over $200 billion for Mozambique and nearly $50 billion for
Tanzania in the period to 2040. This would help governments to address growing debt
accumulation and ensure macroeconomic stability. However, it is vital that there should be
transparency about the use of these revenues and that they should be used to bring
tangible economic benefits for the country. History suggests that, after major discoveries,
some countries have quickly scaled up public investment and accumulated excessive debts
based on unrealised future revenues, damaging their economic performance in the
process. Avoiding this so-called “pre-source curse” is essential if income from gas exports is
to provide maximum benefit to Mozambique and Tanzania.
Senegal and Mauritania are also potential producers. Major offshore discoveries were
quickly followed by a FID on the Tortue LNG project. The bulk of the gas produced is 4
destined for export, but there is a plan to build a pipeline to the shore to serve domestic
markets. As both countries currently rely heavily on oil for power supply, there is significant
scope for gas to displace oil and meet growing electricity demand. In Senegal, the share of
gas in power generation increases from less than 2% today to nearly half in 2040 in the
Stated Policies Scenario, rising to 60% in the Africa Case.
Gas importers: the case of Ghana

Despite major gas discoveries in several parts of the continent, a large number of African
countries still do not have direct access to large resources, and so need to rely on imports
via LNG, pipeline or gas-by-wire. Ghana is one example, and it has been meeting its gas
needs through a combination of domestic production and pipeline imports from Nigeria via
the West Africa Gas Pipeline (WAGP). Domestic gas is mainly delivered to the Takoradi area
in the west: imports from Nigeria serve the Tema area in the east. However, near-term
domestic production prospects are uncertain and gas supply from Nigeria through the
WAGP has been erratic.5 These have led the country to explore the prospects for LNG
imports. Tema LNG, the first FSRU, has been much delayed but now aims to start supplying
imported gas from the early-2020s. At a delivered price of around $8/MBtu, imported gas is
likely to displace the prevalent use of oil in the power and industry sectors (OIES, 2019).6
Ghana has also recently put in place an interconnector between its two separate gas
transmission systems to take surplus gas from the Takoradi system to the Tema system.
Further increases in LNG imports will depend on how demand for gas evolves. In the Stated
Policies Scenario, gas demand in Ghana continues to be concentrated in the power sector.
With generation from hydropower remaining stable, the growth in electricity demand is
mostly met by gas and solar PV in the period to 2040, pushing up total gas demand to
4 bcm in 2040. In the Africa Case, gas plays a larger role in meeting higher electricity
5
Physical attacks on the pipeline, diverting gas towards Nigeria’s domestic market and the payment dispute
by the Volta River Authority – Ghana’s off-taker – all contributed to unstable supply of gas via the WAGP.
6
With oil prices around $50 per barrel.

demand growth and is also used in the industry sector. Gas demand in 2040 is over 70%
higher in this scenario, reaching 7 bcm, which points to a need for additional LNG imports.
The requirements for LNG could be higher if Ghana pursues an option to export gas-based
electricity to neighbouring countries via the West Africa Power Pool, for example to Benin,
Burkina Faso, Côte d'Ivoire and Togo.
A number of other countries including Benin, Côte d'Ivoire, Kenya, Mauritius and Namibia
are also reviewing options for LNG imports, but little progress has been made to date. Côte
d'Ivoire was considering a plan to build an import terminal, but the project has been
delayed following lower-than-expected demand growth and disputes over pricing. One of
the challenges in developing smaller LNG projects focused on one country’s gas demand is
that small changes in either domestic demand or production outlook can easily reduce
economies of scale and therefore affect the viability of the project. Concerns over the
creditworthiness of off-takers and the reliability of payments can also constrain financing
options for LNG projects.
For countries with little domestic production and limited access to LNG, gas has difficulty
making inroads into the energy mix as small market size often does not justify investments
in pipeline infrastructure. Some countries in this position are exploring a gas-by-wire option
which would involve importing gas-generated electricity from countries within the same
regional power pool. This option also offers an opportunity for exporting countries to
increase economies of scale. It does however depend on a well-functioning power pool
system (see Chapter 3).
4.2.2 Outlook for natural gas demand, production and infrastructure

developments in Africa
Gas production in Africa is set to rise significantly in both the Stated Policies Scenario and
the Africa Case as the development of recent new discoveries moves sub-Saharan Africa
into the higher ranks of global gas producing regions.
Gas production increases in all North African countries in the Stated Policies Scenario. In
Algeria, the largest gas producer in Africa today, production edges down to the early-2020s
due to the lack of new developments to compensate for the decline in existing fields, but
rebounds over time as additional output from legacy fields is joined by new projects. The
country remains the largest gas producer in Africa through to 2040. Production in Egypt
rises to some 100 bcm in 2040, reflecting developments in the Zohr and Nooros fields and
plans to evaluate the Nour prospect. Libya also sees a significant increase in gas production,
and it accounts for around 30% of the overall increase in North Africa.
Projected production in sub-Saharan Africa more than triples, reaching over 240 bcm by
2040. Recent discoveries mean that a range of new countries, notably Mozambique,
Tanzania and Senegal, join the club of major producers. These three countries account for
almost two-thirds of the increase in gas production in sub-Saharan Africa over the next two
decades. Mozambique becomes the largest gas producer in sub-Saharan Africa by 2030. In
the Stated Policies Scenario, production in sub-Saharan Africa in 2040 approaches the level

in North Africa. In the Africa Case, where higher demand coexists with reduced regulatory
risks, production rises by an additional 60 bcm, pushing it above 300 bcm by 2040.
The upbeat outlook for gas production in the Stated Policies Scenario underpins a threefold
increase in demand in sub-Saharan Africa over the period to 2040. The share of gas in the
energy mix rises from 5% today to just under 10% in 2040. In the Africa Case, with greater
efforts to expand gas (and electricity) infrastructure, the share of gas in the energy mix rises
to nearly 20% in 2040 (close to the average share of developing economies today). In this
scenario, gas demand in sub-Saharan Africa climbs to around 180 bcm in 2040 (Figure 4.6).
Exports from North Africa rise at a rate of 1% per year in the Stated Policies Scenario, while
those of sub-Saharan Africa grow at a much faster pace. Today, Africa as a whole exports a
similar volume of gas as Australia. By 2040, growing LNG exports from East Africa mean
that sub-Saharan Africa is a major force in global gas markets.
4
Figure 4.6 ⊳ Natural gas production and demand in Africa by scenario
Production Demand
300 Iran 2040
bcm
200 Australia India 2040

2040
Japan and
Korea 2040
100
Sub-Saharan North Sub-Saharan North

Africa Africa Africa Africa
2018 2040: Stated Policies Africa Case
Africa strengthens its position in global gas markets in terms of both production and
demand; gas makes strong inroads into the energy mix in the Africa Case
While the prospects and constraints vary by country, gas (or electricity) infrastructure is an
essential prerequisite if gas is to thrive. Recent signs indicate that approaches to gas
infrastructure development are likely to become more diverse. In addition to major long-
distance pipelines to supply large-scale power plants, companies are increasingly looking at
reaching industrial and commercial customers via small-scale LNG delivery or through
distribution networks around industrial hubs. For example, Greenville LNG is operating
300 LNG trucks to deliver gas to a range of industrial customers, small-scale power plants
and logistics companies in Nigeria and could potentially extend this to large mines and
power plants in Burkina Faso (Africa Energy, 2019). Shell is developing distribution pipeline
networks in the areas around major industrial hubs in Nigeria. Companies are also seeking
better use of existing fuel distributors to distribute gas.

These small-scale, distributed approaches (akin to the value chain of liquefied petroleum
gas) are likely to complement the traditional distribution channels (large pipelines) and
help unlock new markets for gas. For example, many industrial and commercial customers
today are paying higher costs for oil products, especially diesel, to operate their facilities:
we estimate that some 10 bcm of this oil demand (30% of today’s gas demand in sub-
Saharan Africa) could be displaced economically given today’s prices (Figure 4.7). However,
given the relative ease with which oil products can be transported, this switch would
happen only if policies and infrastructure allow gas suppliers to reach potential customers.
Figure 4.7 ⊳ Potential for oil displacement by small-scale LNG in power and
industry in sub-Saharan Africa, 2018
10
Power
bcm
8 Industry
0-5 5-10 10-15 15-20 20-50 Total

Delivered cost differential between oil products and gas (Dollars per MBtu)
Small-scale LNG has potential to displace 10 bcm of oil use in
power and industry at today’s prices
4.2.3 Conclusions
Recent major discoveries present a renewed opportunity for gas to have a larger role in
supporting Africa’s energy and industrial development, but it is difficult to say “this time
will be different” given that the challenges posed by small market size, infrastructure
constraints and affordability remain considerable. Nonetheless, successful industrialisation
hinges upon the stable provision of energy, and gas is well suited to providing this, whether
directly where medium- and high-temperature heat is needed or indirectly where a source
of relatively clean electricity is needed.
The idea of Africa leapfrogging directly from an energy system dominated by bioenergy to a
fully decarbonised system is attractive, and it makes sense to develop renewables as
rapidly as possible. However, it is hard to see how a fully decarbonised system can be
achieved cost effectively in the coming decades while also meeting the continent’s stated
goals for industrialisation and economic development. Reliable electricity supply is an
important element of the solution and this is set to be accompanied and supported by

rapid deployment of renewables. However, in this sector there is also scope for gas to play
an important role by providing a flexible and dispatchable source of electricity, helping to
constrain the expansion of oil-based generators or coal-fired plants. In addition, there are
other energy uses that cannot easily be electrified, including many industrial processes. The
choice for these uses is occasionally between gas and renewables, but much more often
between gas and more polluting fuels. The challenges for gas relate to infrastructure,
affordability and business models: bringing gas into the energy system is inherently a
challenging task, and cannot be taken for granted. Getting these new value chains up and
running would require a concerted effort from Africa’s decision makers.
4.3 Maximising the value of Africa’s resources

Africa is endowed with abundant oil, gas and mineral resources. However, in many cases 4
resource-rich African countries have not been able to capitalise on these resources in a way
that supports their economic and industrial growth. A World Bank study suggests that,
following a major resource discovery, countries on average not only failed to meet high
expectations for economic growth, but actually registered lower growth rates in the
short-run than before a discovery, mostly as a result of weak governance (Cust and Mihalyi,
2017).
Fossil fuels and minerals account for over a third of exports in roughly 60% of African
countries, which together account for 80% of the region’s GDP. Countries in which these
commodities make up more than two-thirds of their exports account for almost half of the
region’s GDP (Figure 4.8). Since demand and prices for commodities tend to be highly
variable depending on market circumstances, this means that the export revenues of many
African countries are subject to large swings, with knock-on effects on their economies.
There are many examples of the dangers of over-dependence on this narrow and volatile
source of revenue. Recent market developments – and uncertainties over the future –
underline the risks of a high reliance on resource revenues. The rollercoaster ride in oil
prices since 2014 has exerted severe fiscal and economic strains on many producers in
Africa, while the near-term impact of buoyant US tight oil production on global supply and
the longer term impact of energy transitions on demand make a compelling case for
improved resource and revenue management and for economic diversification and reform.
African producers are responding to these challenges. After a major slump in activity post-
2014, there are signs that interest and activity in parts of Africa’s upstream are picking up
again. Against this backdrop, how can Africa make the most of its vast resources to spur
inclusive development and growth? To answer this question, we take a look at the outlook
for fossil fuel production and resource revenue under different scenarios, examine what
strategies are open to African resource-owners to mitigate risks, and assess what the
potential impact of abating these risks might be on production and revenue.

Figure 4.8 ⊳ Share of commodities in total merchandise exports and GDP
in African countries, 2017
Angola
Algeria
Libya
Nigeria
Botswana
Chad
Equatorial Guinea
DR Congo
Gabon
Guinea
Mozambique
Zambia
Sierra Leone 46%
Congo
Sudan
Burkina Faso
Ghana
Eritrea
Mali
Rwanda
Namibia
Mauritania
Togo
Cameroon
Niger
South Africa
Burundi
Tanzania
Zimbabwe
Egypt
Senegal
Liberia
Benin 34%
Madagascar
Seychelles
Côte d'Ivoire
Lesotho
Uganda
Djibouti
Ethiopia
Kenya
CAR
Morocco
Gambia
Tunisia
Mauritius
Guinea-Bissau 20%
Eswatini
Comoros
Cabo Verde
Somalia
Malawi
20% 40% 60% 80% 100% Share of GDP
Fuels Minerals
African economies are highly exposed to commodity exports; those relying on
commodities for more than a third of their exports account for 80% of the continent’s GDP
Notes: CAR = Central African Republic. Minerals include ores, metals, precious stones and gold.
Source: IEA analysis based on UNCTAD Stats.

4.3.1 Outlook for fossil fuel production
The oil price plunge in 2014 severely curtailed spending in Africa’s upstream and this
continues to weigh on the near-term production outlook. A combination of market
conditions, lower revenues, ageing fields and regulatory uncertainties means that
investment across Africa’s upstream oil and gas sector has fallen by 40% since the high
point reached in 2011, and the fall in sub-Saharan Africa has been particularly steep. More
recently, there have been some signs of a pickup in activity with new licensing rounds,
some major discoveries (primarily of gas) and FIDs. In the Stated Policies Scenario, after a
dip in the 2020s, overall oil production almost returns to today’s level by 2040.
Figure 4.9 ⊳ Oil and natural gas production outlook in Africa in the
Stated Policies Scenario
Oil Natural gas 4

10 500
mb/d
bcm
8 400
6 300
4 200
2 100
2018 2025 2030 2035 2040 2018 2025 2030 2035 2040
Nigeria Libya Angola Algeria Mozambique and Tanzania Egypt Other
Oil production in Africa makes a moderate rebound from the mid-2020s,
while gas production doubles as incumbent producers are joined by new players
The oil outlook is driven by a handful of major producers, all of whom face significant
question marks and challenges. Libya has the largest oil reserves in Africa and remains the
main source of production in North Africa. Its production continues to rebound and by
2040 almost reaches the level seen in 2010 (when the recent volatility in production levels
started), although downside risks from political instability and civil unrest remain. Algeria’s
output continues to trend downwards due to the depletion of existing fields, dropping to
1.2 mb/d in 2040. The production outlook in sub-Saharan Africa depends heavily on two
major producers, Nigeria and Angola, who have managed recent challenges in contrasting
ways. In Nigeria, continued uncertainty over upstream regulation and governance mean
that near-term output is projected to plateau until the mid-2020s, before improved market
and (by then) domestic reforms allow for a modest resumption of production growth. In
Angola, the government has accelerated reforms in an effort to stimulate investment.

Assuming this effort is sustained, we project that Angola’s output decline is slowed
somewhat but that production nonetheless gradually falls to 1.2 mb/d in 2040 (Figure 4.9).
A new group of producers also emerges in sub-Saharan Africa in our projections, including

Uganda, Kenya and Senegal: their contribution to growth is relatively minor although the
associated revenue promises to make a significant difference to their fiscal balances.
The gas outlook is quite different. Gas production in Africa grows by 270 bcm between
2018 and 2040, a doubling of output that is comfortably ahead of the rate at which oil
production grows (see section 4.2.2). Thanks to a number of new discoveries and also the
growing role of gas in the global energy system, there is a clear shift towards gas in
upstream activities. Since 2010, some 20% of upstream oil and gas investment in Africa has
been directed towards gas, and this increases to 36% between 2018 and 2040 in this
scenario.
Coal production in Africa declines through to 2030 before making a modest rebound to
220 million tonnes of coal equivalent (Mtce) in 2040 in the Stated Policies Scenario. South
Africa remains the dominant coal producer in Africa. Despite the steady decline in output, it
still accounts for three-quarters of Africa’s coal production in 2040, down from over 90%
today. Coal output in Mozambique, mainly coking coal for export, increases threefold to
around 30 Mtce in 2040, offsetting some of the decline in South African output. While coal
mining is not as significant for the continent as oil and gas, the production of other minerals
and metals is a key component of Africa’s economy and is expected to remain so; many of
its minerals and metals play a critical role in helping the global energy transition.
S P O T L I G H T
What does the clean energy boom mean for mineral production
in Africa?
The rapid rise of clean energy technologies is not only changing the landscape for the
power sector, but also for mineral and metal producers, including those in sub-Saharan
Africa (Figure 4.10). For example, the greater need for batteries for energy storage and
electric vehicles is set to supercharge demand for lithium, cobalt and manganese. What
might this mean for sub-Saharan Africa’s mineral production?
In 2017, net income from mineral production accounted for 2% of GDP in sub-Saharan
Africa, with a majority of Africa’s mineral reserves and production located in the south
part of the continent. The Democratic Republic of Congo (DR Congo) is rich in cobalt; it
accounts for almost two-thirds of the world’s production and has half of the world’s
known reserves. South Africa produces 70% of the world’s platinum (used both in
internal combustion engines and fuel cells), 45% of the chromium (used in wind
turbines) and a third of the world’s manganese (a vital element for steel and advanced
batteries). Rwanda and DR Congo both produce tantalum (some 30% and 40% of the
global supply respectively) which is critical for electronics. Namibia and Niger were the
world’s fourth- and fifth-largest producers of uranium, critical for nuclear power plants
(World Nuclear Association, 2019). It is also highly likely that Africa is home to rare
earth elements, though no comprehensive survey has been undertaken to determine

the potential (World Bank, 2017).

Figure 4.10 ⊳ Share of sub-Saharan African countries in global production
of key metals and minerals, 2018
DR Congo
Chromium
South Africa
Gabon
Cobalt
Madagascar
Zimbabwe
Manganese Ghana
Mozambique
Platinum Rwanda
Other sub-Saharan
Tantalum Africa
Rest of world
Titanium
4
20% 40% 60% 80% 100%
Sub-Saharan Africa provides a significant share of the

world’s key metals and minerals critical to clean energy technologies
Source: USGS (2019).
As with oil and gas, sub-Saharan Africa has experienced boom-and-bust cycles of
mineral exports and associated revenues. For example, a rapid recent rise in demand
for cobalt caused prices to surge between 2016 and mid-2018, unleashing an opposite
imbalance in the market that caused prices to fall by more than 60% from their peak.
Demand for other minerals is also subject to volatility depending on the pace at which a
cleaner energy future unfolds and on which technologies are in high demand,
something strongly influenced by policy making. The projected growth of electric
vehicles in the Stated Policies Scenario means that significant new sources of cobalt
supply will need to come on line in a timely manner. Depending on the chemistry of the
batteries produced, meeting the demand (230 kilotonnes per year in 2040) requires
production to almost double in the Stated Policies Scenario.
There remains significant uncertainty regarding the nature and extent of sub-Saharan
Africa’s mineral resources. Further exploration and quantification is critical to a better
understanding of the potential for extraction as well as recycling. There is also likely to
be strong scrutiny of how these materials are sourced and what standards are in place
all along the supply chain.7 As with oil and gas, robust regulatory and oversight
mechanisms are needed to ensure that impacts on local environments and
communities are minimised and that revenues are used efficiently.
7
Companies are paying increasing attention to responsible sourcing of African minerals. For example, BMW,
BASF, Samsung SDI and Samsung Electronics recently launched a joint initiative to support sustainable and
fair cobalt mining in the DR Congo. The initiative plans to explore ways to improve living and working
conditions for the local small-scale mining operations over a three-year period.

4.3.2 Strategic responses for resource-holders in Africa
Africa’s resources provide an opportunity for accelerated economic development, but the
historical track record underlines the potential downside risks. Highly volatile income
streams can upend economic stability and often do not benefit wider society, while
changing global energy dynamics can undercut the size and reliability of this revenue. With
this in mind, we explore three areas where policies can make a major difference to future
outcomes: ensuring competitive frameworks for investment; investing strategically in
associated infrastructure; and managing resource revenue wisely. Success in all these areas
will need to be underpinned by improvements in governance to provide assurances of
predictability and stability for those looking to invest in energy in Africa.
Ensure transparent and competitive frameworks for investment

In response to an uncertain and changing energy system over the last few years, company
strategies and investment profiles have moved away from more capital-intensive projects
towards shorter cycle projects that recoup investment more quickly. There have been
shorter cycle projects in Africa as well. For example, the Zohr field in Egypt started
production less than three years after its discovery in 2015, but it is the exception rather
than the rule. On the other side of the ledger, there have been many incidences of project
delays due to regulatory uncertainty, complex bureaucracy and politics, weak infrastructure
and gaps in technical capabilities. Such project delays tend to count against African
upstream investment opportunities when they are compared by potential investors with
opportunities in other parts of the world. Analysis of the time lags between a FID and first
production show that sub-Saharan Africa has not been following the global trend towards a
shorter time-to-market for new projects (Box 4.1). In addition, many projects get stuck in
planning and permitting processes before getting to a FID, as illustrated by the difficulty in
proceeding with oil discoveries in Kenya and Uganda.
Box 4.1 ⊳ Time-to-market: the watchword for African oil and gas?
The average size and time-to-market for oil and gas development globally has steadily
declined as energy companies respond to lower revenues and market uncertainties: in
2018 the average time required to bring a project to market was 20% lower than it was
in 2010 (IEA, 2019). The time-to-market for projects in sub-Saharan Africa, which tend
to be smaller than the global average, however, has not changed noticeably over this
period (Figure 4.11). A myriad of above-ground challenges, especially for onshore
projects, bring a risk of further delays between project planning and start-up.
In response, oil and gas producers in various countries have taken steps to ensure that
licensing processes and fiscal terms, including taxes, royalties, production sharing and
dividends from resource extraction, are fair and transparent. Angola is an example of
how a revision to a contract scheme can unlock investment decisions: following reforms
to its regulatory and fiscal regime for offshore projects in 2018, Total approved the Zina

II project after many years of delay. Mozambique, which revised its Petroleum Law in
2014, scores well compared to other countries in sub-Saharan Africa on the Natural
Resource Governance Institute’s Resource Governance Index in terms of transparency
and accountability regarding licensing and taxation (Natural Resource Governance
Institute, 2019). Ghana, which has recently updated a range of upstream regulations,
also scores well though it is much stronger on taxation than licensing. However,
uncertainty about regulatory frameworks and a lack of transparency remain a
widespread problem, and there are sometimes long delays in enacting legislation
designed to address problems. Prominent examples include Nigeria’s longstanding
struggle to pass new petroleum industry legislation, and the as-yet unratified 2014
Hydrocarbon Law in Gabon, which has delayed the licensing round for shallow water
and deepwater blocks opened in 2018.
4
Figure 4.11 ⊳ Average time-to-market trends in the upstream oil and gas
sector for sub-Saharan Africa and the world
World Sub-Saharan Africa

6 500
Million barrels
Years
5 400
4
300
3
200
2
1 100
2010 2012 2014 2016 2018 2010 2012 2014 2016 2018
Average time-to-market Average resource size (right axis)
Global trends of favouring shorter cycle projects are not visible in project selection in
sub-Saharan Africa; time-to-market is further exacerbated by above-ground issues
Notes: Number of years on Y-axis indicates time from FID to operation. Year on X-axis indicates FID year.
Average size and time-to-market are for onshore, offshore and deepwater projects.
How a national oil company (NOC) performs can also have a significant impact on
competitiveness and how the local hydrocarbon industry evolves. NOCs in Africa have
grown in number, but there are questions about how effectively they are fulfilling their
mandates. The role and governance of each NOC varies by country, but NOCs in
sub-Saharan Africa tend to account for a smaller share of upstream investment than most
of their counterparts elsewhere in the world (Figure 4.12). Many have been hampered in
attracting investment by the lack of a clear mandate and by limited financing capabilities
and technical expertise. Lack of oversight and accountability may also reduce the incentives
for NOCs to operate efficiently.

Ensuring that the mandate of a NOC is aligned with the resource base and the needs of a
changing energy sector is a crucial challenge for many African countries. While NOC models
vary, some countries with modest reserves structure their NOCs to focus mostly on the
downstream sector, taking on a role of product purchaser (for example, the National Oil
Corporation of Kenya) or refiner (South Africa’s PetroSA). For resource-rich countries the
role of NOCs is more likely to focus on the development of resources and associated
sectors (Ghana National Petroleum Corporation and Mozambique’s National Hydrocarbon
Company) and management of mature operations (Angola’s Sonangol). Another model
might see a focus on facilitating resource development, for example by conducting
geological surveys and exploration activities where private companies are reluctant to step
in.
No matter what the model is, clarity of purpose together with regulatory certainty,
consistency and transparency are vital to attract investment, develop partnerships and
allow a NOC to fulfil its obligations. Currently, sub-Saharan Africa ranks second to last
among global regions in terms of transparent operation of its NOCs (Heller and Mihalyi,
2019). Ensuring prudent fiscal management and accountability of expenditures is another
very important responsibility for NOCs, particularly given the scale of the resources
involved (for example, Sonangol’s debt has increased to more than 20% of Angola’s GDP).
NOCs also need to position themselves for broader changes in the energy sector, including
national emissions reduction goals, by focusing on their environmental performance and
minimising flaring and indirect emissions (especially methane leaks). In some cases, they
may have the expertise and means to broaden their horizons by supporting the
deployment of a range of low-emissions technologies.
Figure 4.12 ⊳ Share of investment in upstream oil and gas by type of

companies in selected regions, 2018
National oil
Sub-Saharan companies
Africa
Local private
companies
North Africa International
oil majors*
Other
Middle East
Eurasia
20% 40% 60% 80% 100%

Share of upstream investment by NOCs in sub-Saharan Africa

is smaller than in other regions
* Includes BP, Chevron, ConocoPhillips, ENI, ExxonMobil, Shell and Total.

Invest strategically in associated infrastructure
Once resources are extracted, two other crucial issues come into play: whether
infrastructure exists to use these resources productively in Africa’s domestic energy
markets (discussed in this section), and whether the revenues are used prudently to
promote a broader development agenda (discussed in the next section).
In the Stated Policies Scenario, oil demand in sub-Saharan Africa more than doubles
between 2018 and 2040, driven by strong growth in transport and buildings. The annual
rate of growth (at 3.5% per year) is one of the world’s highest, and oil demand grows faster
than in developing economies in Asia. An increasing number of (mostly energy inefficient)
cars on the road pushes up demand for gasoline and diesel, and progress towards clean
cooking raises demand for liquefied petroleum gas (LPG). Although sub-Saharan Africa
produces around 5 mb/d of crude oil every year, its weak refining system means that it
continues to rely on imports to meet its needs for oil products (Figure 4.13). The extent of
4
the shortfall is even greater for low-sulfur products as many countries are moving to
introduce more stringent regulations on fuel quality which local refineries struggle to meet.
For example, Ghana reduced the allowed sulfur content in diesel from 3 000 parts per
million (ppm) to 50 ppm in 2017 and many other countries plan to follow suit. In East
Africa, where Kenya is the only country with a refinery, almost all oil products are
imported.
Figure 4.13 ⊳ Oil production and demand, refinery runs and net oil product
imports in sub-Saharan Africa in the Stated Policies Scenario
5 Oil production
mb/d
Oil demand
4
2 Refinery runs
1
Net product imports
2018 2025 2030 2035 2040

Sub-Saharan Africa remains a net importer of oil products through to 2040
The persistent deficit in oil products indicates that there is a case for new refining
investments to upgrade existing facilities or to build new ones. Many projects are on the
drawing board, but only one small refinery in Cameroon has come into operation in recent
years. The reasons why more capacity has not been built include the relatively small size of

individual country markets, high upfront investment costs, lack of local crude oil supply
(except in major producing countries in West Africa), subsidised fuel prices, widespread
smuggling and regulatory hurdles. Some projects are, though, making progress, with
Nigeria’s 650 thousand barrels per day (kb/d) Dangote project and smaller projects in
Angola, South Sudan and Uganda now looking likely to be commissioned. Nigeria is also
pursuing an option for modular mini-refineries which can be built and transported
relatively easily and which may be well suited to small and relatively remote markets. Both
the Stated Policies Scenario and the Africa Case assume that a number of refineries are
built in the latter part of the projection period, but the region still remains a net importer of
products through to 2040.
A growing need for imports of oil products does not necessarily pose a problem given rising
international competition in refining and the possible growth of gasoline (and diesel)
volumes seeking an export outlet in the global refining system. This is especially the case in
East Africa where there is ample modern and cost-efficient refining capacity in relatively
near reach, notably in the Middle East and India. However, a different risk is created by the
lack of distribution pipelines and storage capacity in much of Africa. The lack of distribution
pipelines means that imported products often have to travel thousands of kilometres by
trucks from port to consumers, adding costs and accompanying a considerable risk of
accidents. Plus the lack of storage undermines the ability to respond to volatile market
conditions.
There is a strong case for strengthened infrastructure to bring oil products to consumers.
This would require countries to harmonise varying regulations on product pricing, fuel
quality and eligibility of importers, and to put in place adequate safety regulations for
distributors. Given relatively smaller upfront capital requirements compared to refining,
investments are already being made in distribution, storage, import facilities and service
stations in Ghana, Tanzania, Uganda and elsewhere.
In the light of recent gas discoveries in Africa, midstream gas infrastructure – pipelines, gas
processing and transportation – is also gaining importance (see previous section). Gas
processing plants could provide an additional revenue stream for the planned gas projects
and make LPG more readily available. While large-scale pipelines connecting prospective
producing regions with major demand centres might well bring benefits large enough to
justify their costs, such pipelines are expensive and it is likely to make sense to combine
them with other options such as gas-by-wire or small-scale compressed natural gas or LNG
solutions to reach small and more remote and widely dispersed markets that do not
currently justify larger-scale pipeline developments.
Hydrocarbon investment can also catalyse the development of other infrastructure. For
example, upstream oil and gas require electricity and could serve as an anchor load to
increase the viability of new power infrastructure. Mining facilities also typically require
new transport links, and could help spur new road or rail infrastructure. Major projects can
also be an opportunity to develop new local supply chains and industries, an aim often

pursued by local content clauses, with the potential to bring long-lasting value to local
economies.
Manage hydrocarbon revenues to finance sustainable economic development

As discussed in Chapter 1, there are considerable risks for producers when national budgets
are heavily dependent on hydrocarbon revenues. The extent of these risks depends on
which pathway the energy sector follows, in particular with regard to future demand levels
and prices (Figure 4.14).
Figure 4.14 ⊳ Average annual net income from oil and natural gas
production by scenario in sub-Saharan Africa
Stated Policies Lower Revenue Case

200 4
Natural
gas
150
Oil
100
50
2010-15
2016-20
2021-25
2026-30
2031-35
2036-40
2016-20
2021-25
2026-30
2031-35
2036-40
Average net income rebounds in the Stated Policies Scenario,

while it remains relatively flat in the Lower Revenue Case
Notes: Net income from oil and gas is defined as the difference between the costs of oil and gas production,
including a normal return on capital, and the value realised from its sale on either domestic or international
markets. This net income changes over time and between various scenario projections, depending on the
cost and volume of production, as well as both the international and domestic price, including any applicable
energy subsidies.
Looking at the trends for individual countries and regions, projected net oil and gas income
for producers in sub-Saharan Africa is generally higher by the end of the outlook period in
the Stated Policies Scenario, but the trend is not a linear one and net income projections
for oil and gas ultimately follow different trajectories (Table 4.2). In the near term to 2025,
oil producers in sub-Saharan Africa suffer for two main reasons. First, the oil market
remains well-supplied due in large part to US shale, which exerts downward pressure on
prices. Second, the slowdown in investment since 2014 and rapid declines in maturing
fields begins to bite, resulting in lower production. As a result, Nigeria and Angola receive
on average 20% and 30% less annual income from oil output to 2025 than they did on
average from 2010 to 2018. Small producers are hit much harder – producers in Central
Africa (e.g. Cameroon, Chad, Congo and Equatorial Guinea) receive 40% less revenue.

By the mid-2020s, net oil income for producers in sub-Saharan Africa starts to rebound in
the Stated Policies Scenario, as the effects of an anticipated near-term pickup in investment
come through, US oil production plateaus and the market once again has more room for
conventional supply. However, production in Nigeria and Angola remains relatively low and
this is only offset in part by the rise of emerging African producers, meaning that net oil
income for sub-Saharan Africa as a whole is just below its 2010-18 levels over the Outlook
period. In the Lower Revenue Case (where global oil demand and prices are substantially
lower because of stronger action in support of climate goals, in line with the objectives of
the Paris Agreement) oil production in sub-Saharan Africa declines by almost 40% over the
projection period, and the average net income of oil producers in sub-Saharan Africa is 45%
lower than in the Stated Policies Scenario.
Table 4.2 ⊳ Average annual net income from oil and natural gas by scenario
and by country in Africa ($2018 billion)
Oil Natural gas

Oil &
gas Stated Policies Lower Stated Policies Lower
Scenario Revenue Case Scenario Revenue Case
2010- 2019- 2026- 2019- 2026- 2019- 2026- 2019- 2026-
2018 2025 2040 2025 2040 2025 2040 2025 2040
Sub-Saharan Africa 123 83 114 67 54 19 40 18 35
Angola 36 25 31 20 14 2 3 2 3
Mozambique 1 0 2 0 1 3 13 3 11
Nigeria 54 37 52 29 24 10 13 10 11
Tanzania 0 0 1 0 1 0 3 0 3
South Africa 3 3 5 3 3 0 1 0 1
North Africa 61 33 57 28 30 16 21 19 37
Algeria 38 17 20 14 12 10 11 11 17
Libya 16 14 33 11 13 1 6 1 4
Africa 184 116 171 95 85 35 61 37 72
Natural gas is less lucrative than oil but our projections suggest that it may offer more
stable revenues. Although pressure from US shale affects gas as well as oil, robust global
demand for gas means that, overall net income in sub-Saharan Africa grows steadily over
the projection period in the Stated Policies Scenario. The downside in the Lower Revenue
Case is also less pronounced, offering some comfort to emerging producers such as
Mozambique. In general, those with more gas in their portfolio fare better than those
countries dependent on oil. For big oil producers such as Nigeria and Angola, cumulative
net income declines by roughly 40% relative to the Stated Policies Scenario, among gas
producers, in Mozambique cumulative net income declines by 20%, while it declines by

15% in Tanzania.

There are two other important points in the context of our projections for net income. The
first is that there is a risk – especially for oil – of substantial volatility in market conditions
and prices, which implies continued difficulties for fiscal management. The second is that
producer economies in sub-Saharan Africa will need to contend with a growing population
and the need to create more jobs (see Chapter 1). By 2040, there will be almost 750 million
more people in sub-Saharan Africa than today. Nigeria alone accounts for almost 20% of
the increase. Beyond considerations of employment, population growth also affects net
income from oil and gas when calculated on a per-capita basis (Figure 4.15). This underlines
the importance of ensuring that revenues from oil and gas are well managed if sub-Saharan
Africa is to attain its development objectives.
Figure 4.15 ⊳ Population and oil and gas net income per capita by scenario
for selected African countries, 2018 and 2040 4
Nigeria Angola South Africa Mozambique
400 1 000
Dollars (2018)
Million
300 750
200 500
100 250
2018 2040 2018 2040 2018 2040 2018 2040

Population Net income per capita (right axis) STEPS LRC
Growing population dwarfs the increase in net income from oil and gas production;
the impacts are amplified in the Lower Revenue Case
Note: STEPS = Stated Policies Scenario; LRC = Lower Revenue Case.
Deciding how and when to allocate revenues generated from oil and gas is a challenge:
many countries have pressing and immediate investment needs alongside the need to
diversify the economy. To manage vulnerabilities and avoid inefficient spending, each
country will need to develop a revenue management plan tailored to its own situation.
Such plans could include fiscal rules and a sovereign wealth fund (SWF) (Box 4.2), and
should include arrangements to ensure oversight of and transparency about resource
revenue flows and expenditure. Assessments of oil and gas revenue management among
sub-Saharan African economies indicate that most remain very vulnerable to commodity
market cycles, although the examples of Cameroon and Ghana highlight what can be done.8
8
Scoring based on 2017 Resource Governance Index from Natural Resource Governance Institute.

Public debt remains a significant problem despite the fact that almost half of the countries
in sub-Saharan Africa have fiscal rules in place to manage spending and borrowing, and
balance the budgets (Natural Resource Governance Institute, 2019).
Box 4.2 ⊳ Role of sovereign wealth funds in sub-Saharan Africa
One often-used tool for revenue management is a sovereign wealth fund which can
help counter-balance volatile commodity prices and diversify revenue streams. In
general, these funds are designed as saving accounts to put money aside for future use;
as buffers to support public sector financing during times of reduced oil and gas
income; and as vehicles to help support economic diversification by investing in
domestic infrastructure and sectors. For example, Senegal’s Fonds Souverain
d’Investissements Strategiques (FONSIS) has played an important role in scaling up solar
PV projects in the country
In Africa, the rise of SWFs is a relatively recent phenomenon; half of them have been
established in the last six years (Hove and Ncube). Some countries set up a fund as soon
as they discover resources to help manage expected but yet unrealised revenue
(although there is also a tendency for some countries to run into difficulties by
increasing expenditure well in advance of future revenue, a phenomenon which has
been called the “pre-source curse”).
But a SWF may not always be an optimal solution, and there is a risk of “premature
funds” in countries with limited savings and high levels of debt. Some countries have
funds that are small in comparison to public debts. For example, Ghana’s public debt in
2014 was 40-times the size of its savings fund, with the rate of return on savings
insufficient even to service the interest rate on its debt (Bauer and Mihalyi, 2018).
Others, such as Kenya, Tanzania and Uganda have either set up funds or are considering
it despite the fact that revenues are unlikely to provide a significant share of fiscal
revenues in the future. This raises the question of whether the money would be better
spent to reduce debts, invest in infrastructure or address economic and structural
deficiencies. The effectiveness of any such spending will however depend on the
administrative capacity to identify and implement the projects that can bring the best
economic and social returns.
4.3.3 Conclusions
Africa’s resource wealth represents both an opportunity and a risk. Faced with multiple
social and economic challenges and a major infrastructure deficit, resource-rich African
countries are unlikely to forego the chance to develop valuable domestic resources. But
extracting value from Africa’s resource wealth requires the establishment of sound, stable
and transparent regulatory and fiscal regimes, and the right institutions and practices to
implement them. This is all the more important in an environment where there are
significant uncertainties over prices and future market conditions.

In the Africa Case, it is assumed that many of the above-ground challenges currently
impeding production are eased. This, alongside higher domestic demand and economic
growth, helps make projects in sub-Saharan Africa more competitive globally and
encourages investment from prospective investors. As a result, oil and gas production in
sub-Saharan Africa is over 10% and 25% higher in 2040 than in the Stated Policies Scenario.
While a higher volume of produced hydrocarbons is directed towards domestic markets,
the average annual net income for oil and natural gas from 2019-40 is still 10% higher than
in the Stated Policies Scenario. Translating higher income into sustained economic growth
requires continued efforts to ensure transparent revenue management, along with prudent
investment in infrastructure aimed at increasing and diversifying economic growth.
4

Chapter 5
Implications for Africa and the world
5.1 Introduction
How the African energy system evolves over the next two decades, and what it will look like
in 2040, are vitally important questions not only for Africa but also the rest of the world.
The future pathway is far from certain but, whatever the policy choices, the implications of
those choices will resonate throughout Africa and beyond. We have outlined possible
pathways for the continent’s energy development to 2040 as described in detail in
Chapters 2, 3 and 4. These pathways are based on an in-depth, sector-by-sector and
country-specific analysis of Africa’s energy sector opportunities: to the best of our
knowledge, this is the most comprehensive such analysis undertaken to date.
The chapter consists of two sections:
 A discussion of the policy implications and outcomes of the analysis in the global
context: This section provides a brief summary of what the future might hold for
Africa’s energy sector, and what it might mean for global energy and emissions trends,
looking in particular at two scenarios. The first is the Stated Policies Scenario, which
takes account of existing plans and announced intentions, and the second is the Africa
Case, which is based on the Agenda 2063 vision agreed by African leaders (see Box I.2
in the introduction).
 Detailed regional and country energy profiles: The second part presents the results of
the Stated Policies Scenario and Africa Case for sub-Saharan Africa as a whole as well
as for eleven countries in this region: Angola, Côte d’Ivoire, Democratic Republic of the
Congo, Ethiopia, Ghana, Kenya, Mozambique, Nigeria, Senegal, South Africa and
Tanzania. The countries covered represent three-quarters of sub-Saharan Africa’s
gross domestic product (GDP) and energy demand today, and two-thirds of
population. The profiles aim to provide decision makers with a data-rich set of
information on the potential energy pathways for each country, considering their
unique energy demand and supply needs and stages of development.
5.2 Implications for the world

Africa’s population is among the fastest growing and youngest in the world, and this trend
is set to continue in the period to 2040. One-in-two people added to the world population
by 2040 are African, and a third of global urban population growth occurs in Africa
(Figure 5.1).
Over the next 20 years, total population growth in Africa is more than double the combined
population growth of China, India and Southeast Asia. In the coming years, Africa overtakes
both China and India in terms of total population. This large increase (mostly occurring in
cities) will be a major force driving Africa’s energy demand growth.
Chapter 5 | Implications for Africa and the world 187

Figure 5.1 ⊳ Total and urban population in Africa, China and India, and share
in global growth, 2018-2040
Population 2018-40 population growth

2.5 100%
Billion people
2.0 80%
1.5 60%
1.0 40%
0.5 20%
2010 2020 2030 2040 Total Urban

Total Urban Africa China India Other
One-in-two people added to the world population and one-in-three people

added to urban populations in the period to 2040 are African
5.2.1 Africa as a key driver for global energy demand growth

A rapidly rising population and growing pace of urbanisation make Africa a key driver of
global energy demand growth. In the Stated Policies Scenario, total primary energy demand
in Africa grows by 2% per year between 2018 and 2040, double the pace of global demand
growth. At the same time, the composition of energy consumption in Africa increasingly
moves away from the traditional use of biomass to modern and more efficient energy
sources, notably electricity, natural gas and oil products.
Effective energy policy choices are essential not only to bring to fruition the continent’s
growth ambitions (including those contained in Agenda 2063), but also to support other
economic and developmental goals. These goals include building a sustainable energy
system, managing the rapid pace of urbanisation, scaling up industrial capacity and
maximising the value of the continent’s natural resources. As a tangible representation of
the Agenda 2063 vision, the Africa Case incorporates policies to build the African energy
sector in a way that allows higher economic growth to be sustainable and inclusive. It
shows that achieving the goals of Agenda 2063 does not necessarily require more energy-
intensive economies, compared with the Stated Policies Scenario. There is a considerable
reduction of bioenergy use in the Africa Case, and growth in demand for other sources of
energy is moderated by strong efficiency improvements. There is also a significant increase
in electricity demand, but additional demand is mostly met by renewables. As a result,
overall primary energy demand in 2040 in the Africa Case is 10% less than in the Stated
Policies Scenario (Figure 5.2).

Figure 5.2 ⊳ Total primary energy demand by fuel and scenario in Africa
500
Mtoe
2018
2040 Stated Policies
400
2040 Africa Case
300
200
100
Oil Gas Renewables* Bioenergy Coal
Achieving the outcome of the Africa Case adds only marginal amounts to demand for oil
and gas relative to the Stated Policies Scenario while reducing the use of bioenergy 5
* Excludes bioenergy.
Africa emerges as a key source of global oil demand growth in our projections. At present,
car ownership levels in Africa – especially in sub-Saharan Africa – are very low (in Ethiopia,
for example, less than 2-out-of-1 000 people own a car). Oil demand grows as the size of
the car fleet expands, and as liquefied petroleum gas (LPG) is increasingly used for clean
cooking.
In the Stated Policies Scenario, the size of the car fleet in Africa more than doubles by 2040.
This contributes to an increase of oil demand by 3.1 million barrels per day (mb/d) over the
period, higher than the projected growth in China and second only to that of India.
However, average car ownership levels in sub-Saharan Africa (excluding South Africa) in
2040 are still equivalent only to 60% of the level in India today. The lack of policies both for
new and second-hand vehicles means that most cars have low fuel efficiency and are not
subject to emissions standards that are common in many parts of the world.
In the Africa Case, the number of cars increases further to nearly 80 million by 2040, but
improved vehicle efficiency offsets the expansion of car stocks and the numbers of
kilometres driven. An increase in oil demand in this scenario relative to the Stated Policies
Scenario is rather driven by the residential sector, where progress towards clean cooking
creates additional demand for LPG.
Africa’s growing weight is also felt in natural gas markets. The combination of renewables
and natural gas provides a good fit for the development vision that African leaders signed
up to in Agenda 2063. In the power sector, natural gas can help satisfy the growing appetite
for baseload electricity and complement the rapid expansion of renewables, especially in
those countries with large gas resources. There are also many energy uses that are hard to

electrify (for example, industrial processes such as steel making) that are likely to see
demand growth as African industry supports the continent’s growth in urbanisation and
infrastructure. In many cases, the choice for these uses is between gas and other (more
polluting) fossil fuels rather than between gas and renewables.
The challenges for natural gas development relate to infrastructure, affordability and
business models. A number of major gas discoveries (representing over 40% of global gas
discoveries between 2011 and 2018) have been made in recent years, but the extent to
which they will provide fuel for African development, as well as revenue from export, is
uncertain. Making the most of these resources would require new pipeline infrastructure,
although small-scale liquefied natural gas (LNG) technologies are allowing a new approach
to distribute gas to consumers. Much will depend on the strength of Africa’s policy push to
displace polluting fuels from its energy mix, or to prevent them gaining a stronger foothold,
and on the availability of finance to support the expansion of gas infrastructure.
In the Stated Policies Scenario, the share of gas in sub-Saharan Africa’s energy mix rises
from 5% today (one of the world’s lowest) to just under 10% in 2040. In the Africa Case, it
reaches almost 20% in 2040. In both scenarios, Africa becomes the third-largest source of
additional gas demand globally between today and 2040, following China and the Middle
East (Figure 5.3). Thanks to the emergence of new producers, notably Mozambique,
Tanzania, Senegal and Mauritania, Africa also strengthens its position in global export
markets.
Figure 5.3 ⊳ Growth in oil and natural gas demand by region in the Stated
Policies Scenario and Africa Case, 2018-2040
Oil Natural gas
India China
Africa Middle East
China Africa
Middle East India
Southeast Asia United States

2 4 200 400
mb/d bcm
Increase in the Africa Case
Africa emerges as a key source of demand growth for oil and natural gas. The growth in oil
demand is second only to India; the growth in gas demand is the third-largest in the world
Reliable electricity supply plays a central role in meeting rising energy demand in Africa.
Electricity demand in Africa is set to increase strongly, more than doubling from
700 terawatt-hours (TWh) today to over 1 600 TWh in 2040 in the Stated Policies Scenario

and to 2 300 TWh in the Africa Case. Renewables make a major contribution to the
additional generation required. Falling costs drive the fast deployment of utility-scale and
distributed solar photovoltaics (PV), and deployment of geothermal and wind also picks up
sharply: in the Stated Policies Scenario, the combined contribution of these non-hydro
renewable resources increases from less than 5% today to around 30% of Africa’s total
power generation in 2040. Hydropower also remains a cornerstone of sub-Saharan
Africa’s power system – notably in the Democratic Republic of the Congo (DR Congo),
Ethiopia and Mozambique – and generation almost triples by 2040. Better regional
co-operation and integration of power networks is instrumental in unlocking hydropower’s
huge potential.
The scale of deployment of non-hydro renewables is even more significant in the Africa
Case. A large part of this comes from solar PV, which overtakes hydropower and natural gas
to become the largest electricity source in Africa in terms of installed capacity (and the
second-largest in terms of generation output). Solar PV deployment between today and
2040 amounts to almost 15 gigawatts (GW) a year, equivalent to the amount of solar PV
capacity the United States adds every year over the same period. Wind also expands rapidly 5
in several countries benefiting from high quality wind resources, notably Ethiopia, Senegal
and South Africa, while Kenya is at the forefront of geothermal deployment. The growth in
overall renewable-based electricity generation in African countries is higher than in the
European Union (Figure 5.4).
Figure 5.4 ⊳ Growth in renewables-based electricity generation in

selected regions, 2018-2040
Solar PV Other renewables

1 000
TWh
800
600
400
200
India Africa United European European Africa India United

States Union Union States
Increase in the Africa Case
Renewables account for three-quarters of additional electricity generation

in the Africa Case, and bring Africa to centre stage in global renewables markets
Note: Other renewables include hydro, wind, geothermal, concentrating solar power and biomass.

Achieving this level of deployment would require the development of efficient supply
chains and the physical infrastructure necessary to facilitate smooth trade in goods and
technologies between countries (as envisaged in the African Continental Free Trade Area).
A favourable regulatory environment which reduces risks and the cost of finance would
also be essential, as would the technical capacity to underpin a large-scale installation and
maintenance sector.
5.2.2 Mobilising investment for reliable power: challenging but achievable

Africa needs to expand its energy infrastructure, especially in the power sector, to serve its
growing population. Despite being home to 17% of the world’s population, Africa currently
accounts for just 4% of global power supply investment. On a per capita basis, power
supply investment in Africa ranks among the lowest in the world (Figure 5.5). In
sub-Saharan Africa, power generation capacity per capita has shown little or no growth
since 1990 while that of India and Southeast Asia has grown fourfold.
Figure 5.5 ⊳ Per capita power supply investment by region, 2018
400
Dollars per capita
300
200
100
North Europe China C &S Southeast India Africa

America America Asia
Africa’s per capita investment in power supply ranks among the lowest in the world
Note: C & S America = Central and South America.
Addressing the deficit of power infrastructure in Africa will require a significant ramp-up in
spending. Investments in power supply need to double through to 2040 in the Stated
Policies Scenario to around $65 billion per year. The Africa Case requires a further doubling
to around $120 billion per year to ensure reliable and affordable power for all and to serve
an economy growing at over 6% a year. Nigeria, South Africa, DR Congo and Ethiopia are
among the countries with the highest investment needs. Half of the investment is needed
to expand and upgrade electricity networks – including mini-grids – and most of the rest is
needed to increase low-carbon generation capacity where solar PV plays an important role.
Investment needs in solar PV in sub-Saharan Africa amount to almost $25 billion per year
on average in the Africa Case – almost double the level of investment in the European
Union today.

The cumulative investment in Africa’s power supply between 2019 and 2040 reaches
$1.4 trillion in the Stated Policies Scenario (1.6% of the continent’s GDP over the same
period) and $2.6 trillion in the Africa Case (2.4% of GDP). Mobilising these levels of
investment is a significant undertaking, but it is achievable if concerted efforts are made by
African governments and the global community. There are some precedents. India, for
example, has invested the equivalent of 2.6% of GDP in the power sector since 2000 and
China has invested 1.9% of GDP over the same period (Figure 5.6).
Figure 5.6 ⊳ Average annual power supply investment in Africa by scenario

and historical power sector investment in selected regions
Africa power sector Power sector investment as share of GDP

150 3%
100 2%
5
50 1%
2018 STEPS AC STEPS AC India China Southeast

2019-40 Asia
2019-40 Africa 2000-18
Generation Electricity network
Scaling up power supply investment is challenging but achievable if concerted efforts are
made to establish a favourable investment climate and reduce investment risks
Notes: STEPS = Stated Policies Scenario; AC = Africa Case.
To date, investment in power supply in Africa has relied largely on state budgets with
significant contributions from development finance institutions (DFIs). The prominent role
of these public sources is likely to continue. Against a backdrop of growing fiscal deficits in
many countries and tightening donor resources, however, it is critical that public spending
is supplemented by private capital and that funding from DFIs is used to catalyse private
financing.
Mobilising private capital requires concerted efforts from both African governments and
international DFIs. A large number of countries in Africa limit private participation in the
power sector: 16-out-of-43 sub-Saharan African countries do not allow private participation
in both generation and electricity networks. Establishing a framework for private capital is
clearly a necessary first step. Many of the utilities are loss-making and have low operational
efficiency: 19-out-of-39 utilities in sub-Saharan Africa are not able to recover enough cash
to cover operational expenses (Kojima, 2016). Together with below-cost tariffs and low
collection rates, this raises investment risks and makes it difficult to secure financing at

affordable costs. Improving the financial and operational performance of utilities and
moving towards cost-recovery are therefore essential to attract financing. Robust
procurement frameworks (using competitive auctions, for example) and well-designed
contracts are also crucial to enhance project bankability.
There is scope for international DFIs to help scale up investment and catalyse more private
capital. Between 2013 and the first half of 2018, power sector investments based on
private participation in infrastructure models in sub-Saharan Africa amounted to around
$4.5 billion per year on average (less than 10% of the annual power sector investment
needs between today and 2040), with South Africa accounting for more than half. Outside
South Africa, each dollar of public funding (from DFIs and state budgets) attracted $0.6 of
private capital either directly (via equity and direct loan) or indirectly (via guarantee) – the
figure is $0.4 for renewables. This compares unfavourably with $0.9 for Southeast Asia and
more than $4 for South Africa. It is therefore important for international DFIs not only to
scale up direct investments but also to encourage private sector investment through
targeted interventions (such as risk sharing, liquidity support and take-out financing). There
is also a need to nurture the local financial sector to provide a sustained flow of long-term
financing to infrastructure projects.
The prospects for Africa’s power supply investment will be stronger if governments in
African countries take account of what have worked well (and what have not) in other
countries. India provides some instructive lessons. In the 2000s, the Indian government
introduced a number of measures to establish a policy and regulatory framework to attract
private capital, including model architecture for public-private partnerships (PPP) and
financial instruments (such as an on-lending facility) to induce local financial institutions to
invest in infrastructure. This contributed to a significant scale-up of private investment in
power infrastructure and India was recognised as the highest recipient of PPP investments
worldwide (World Bank, 2015). However, scrutiny of the commercial viability of projects
was sometimes insufficiently rigorous, there were frequent construction delays, and the
availability of fuel was often limited: this led to many projects performing less well than
expected, and emphasises that there are potential pitfalls to manage even where the
overall framework is a strong one.
5.2.3 Not a major emitter, but climate change matters greatly for Africa
Africa has not been a significant contributor to global greenhouse gas (GHG) emissions
during the age of industrialisation. Energy-related carbon dioxide (CO2) emissions in Africa
accounted for only 2% of global cumulative emissions from 1890 to today (Figure 5.7).
Although Africa experiences rapid economic growth in the Stated Policies Scenario (by two-
and-a-half times from today to 2040), its contribution to global energy-related
CO2 emissions increases to just 4.3% over the period to 2040.
Realising the outcomes in the Africa Case would increase total CO2 emissions over the
period to 2040 by around 2 gigatonnes (Gt) (or 100 million tonnes (Mt) per year) relative to
the Stated Policies Scenario, raising Africa’s contribution to 4.5%. Although this is not a

major increase globally, it is highly desirable – and in line with the vision in Agenda 2063 –
that they are attained in a way which takes full account of the importance of sustainability,
with a very strong role for clean energy sources. Looking beyond CO2, the transition away
from the inefficient combustion of biomass for cooking in the Africa Case leads to same
levels of GHG emissions as in the Stated Policies Scenario as the increase in CO2 emissions is
offset by reductions in other GHGs (methane and nitrous oxide).
Figure 5.7 ⊳ Cumulative energy-related CO2 emissions by region and

scenario
500
Gt
2019-40
Stated Policies
400
Increase in AC
300
1890-2018
200 5
100
United China European Russia India Africa

States Union
Africa has accounted for a very small share of global CO2 emissions to date,
and that does not change to 2040
Note: AC = Africa Case.
Thanks to technology improvements and resource endowments, Africa has the opportunity
to pursue a much less carbon-intensive model of development than seen in many other
parts of the world. For example, China relied heavily on coal (and oil to a lesser extent) to
replace bioenergy and meet rapidly growing energy demand between 1990 and 2005 when
its economy registered a fourfold growth. This resulted in cumulative emissions of around
50 Gt CO2, meaning that China incurred around 660 grammes of carbon dioxide (g CO2)
emissions to generate one dollar of GDP over this period. India has similarly relied on coal,
oil and (to a lesser extent) natural gas to serve its expanding economy over the two
decades since 2000. This was accompanied by cumulative emissions of around 28 Gt CO2
or 250 g CO2 per dollar of GDP.
In our projections, however, Africa follows a different pathway, with much stronger shares
of renewables and natural gas in the energy mix. In the Stated Policies Scenario, the share
of renewables (excluding bioenergy) and natural gas grows significantly to 10% and 20%
respectively by 2040, while the reliance on traditional uses of bioenergy and coal

diminishes. As a result, only 130 g of CO2 emissions are incurred to generate one dollar of
GDP between today and 2040, while the economy grows at a rate of 4% per year.
In the Africa Case, the size of the economy almost quadruples in the period to 2040, but the
continent consumes less energy overall with a higher share of cleaner energy sources. The
shares of renewables and natural gas expand further to 20% and 25% by 2040, while the
share of traditional uses of bioenergy declines. The emissions associated with economic
growth are 15% lower in this case, at around 110 g CO2 per dollar of GDP (Figure 5.8). These
emissions relative to economic growth are lower than the figures observed in advanced
economies between 2000 and 2018.
With the appropriate policies to support a strong expansion of clean energy and sufficient
emphasis on energy efficiency improvements, Africa could be the first continent to achieve
a significant level of industrialisation with cleaner energy sources playing a prominent role,
requiring much less energy and emissions to deliver economic growth than other
economies in the past.
Figure 5.8 ⊳ Changes in primary energy demand by fuel and associated

emissions per GDP in China, India and Africa
1 000 0.8
g CO2 /$GDP
Mtoe
750 0.6
500 0.4
250 0.2
- 250 - 0.2
China India STEPS AC
(1990-2005) (2000-2018) Africa (2018-2040)
Biomass Nuclear Coal Oil Natural gas Renewables Emissions per GDP (right axis)
Africa could be the first continent where renewables and gas play a prominent role in
supporting a shift away from bioenergy and underpinning economic and industrial growth
Notes: STEPS = Stated Policies Scenario, AC: Africa Case. Emissions per GDP = cumulative CO2 emissions /
cumulative GDP during the indicated period. Renewables exclude bioenergy.
While Africa is responsible for a relatively small portion of global CO2 emissions, its
ecosystems already suffer disproportionately from global climate change, and future
impacts are expected to be substantial. The continent therefore not only needs to adapt to
the warming already experienced but also to prepare for the intensification of climate
change impacts (World Bank, 2018). Temperatures in Africa are likely to rise faster than the

global average during the 21st century. Climate change and climate variability are likely to
multiply existing threats and pose increased risks to food, health and economic security in
Africa (IPCC, 2014).
This underlines the importance of ensuring that new infrastructure in Africa is climate-
resilient. For example, only 30% of the buildings that are likely to exist in 2040 have already
been built. If building codes are implemented for new buildings to optimise the use of
natural light and ventilation for passive cooling, this could reduce the need for cooling
systems (fans and air conditioners) and avoid the potential heat islanding effects that could
occur in cities (see Spotlight in Chapter 2). Today, a quarter of the global population living
in areas that are hot enough to require cooling systems live in Africa, and this share
increases to 30% by 2040 in all scenarios. As new cities are built or existing cities grow
larger, smart planning is essential to ensure that buildings are highly energy efficient and to
facilitate sustainable modes of public transport.
Climate change is also likely to affect the availability of hydro resources. Detailed new
analysis in this report shows the negative impacts of climate change on the availability and
variability of hydropower outputs in a number of countries. While hydropower remains an 5
essential element of sub-Saharan Africa’s electricity supply, diversifying the electricity mix
would help to mitigate the risk of power disruptions during droughts and strengthen
resilience to changing climate conditions.
In contrast to many other regions, the energy sector is not the biggest contributor to total
GHG emissions in Africa. It represents around a third of total GHG emissions (compared to
more than two-thirds at the global level). In sub-Saharan Africa (excluding South Africa),
land use and forestry1 (LULUCF), agriculture and waste contribute most towards total GHG
emissions. The reduction in the size of Africa’s forests, which are natural carbon sinks, is the
primary reason for the growth of GHG emissions in Africa: some countries have seen their
forest area decrease by more than half over the last 25 years (Box 5.1), highlighting the
importance of deforestation for climate policies.
While the ecological and environmental toll of reliance on fuelwood for cooking cannot be
exactly quantified, the traditional use of solid biomass for cooking comes at a large cost to
human health and wellbeing. Air pollution in Africa is one of the leading causes of
premature deaths. Around 500 000 premature deaths are attributed to smoky indoor air
arising from the use of solid biomass for cooking while 300 000 premature deaths are
linked to outdoor pollution in cities.
In the Stated Policies Scenario, premature deaths owing to household air pollution
decrease slightly over the outlook period as a consequence of efforts to bolster access to
clean cooking through LPG stoves, improved biomass stoves or biodigesters. There is a
much greater adoption of these cleaner technologies in the Africa Case: over 1.1 billion
people move away from traditional use of solid biomass by 2030, and the number of
premature deaths from household air pollution falls by two-thirds.
1
LULUCF refers to land use, land-use change and forestry.

Box 5.1 ⊳ Implications of unsustainable bioenergy use
Since 1990, the total forest area in Africa has fallen by 85 million hectares (ha), which is
more than the total land area of Mozambique (Figure 5.9). Some countries have been
more affected than others. For instance, Nigeria has lost 60% of its forest cover since
1990, while Tanzania and Ethiopia have lost almost 20% of their forest areas (FAO,
2019).
Conversely, fuelwood consumption (directly used by households for cooking or to

produce charcoal) has doubled in sub-Saharan African countries (excluding South
Africa) over the same period. While the relationship between deforestation and
growing demand for fuelwood is difficult to quantify, efficiency improvements across
the various bioenergy value chains could play a significant role in protecting forests,
biodiversity and carbon sinks.
Figure 5.9 ⊳ Fuelwood consumption in the Stated Policies Scenario and

the Africa Case, and forest area in selected African countries
Tanzania Nigeria Kenya Ethiopia

400 60
Million hectares
Million tonnes
300 45
200 30
100 15
1990
2018
2040
2040
1990
2018
2040
2040
1990
2018
2040
2040
1990
2018
2040
2040
Stated Policies Africa Case Forest area (right axis)
Making fuelwood consumption more sustainable is key to tackling

deforestation in many sub-Saharan African countries
A number of countries have already made commitments to address deforestation in

their updated Nationally Determined Contributions. Nigeria acknowledges the need to
halt deforestation, conserve remaining natural forests and reverse forest degradation.
Others, including DR Congo, have pledged to commit efforts to reforestation activities.
Converting these ambitions into actions and extending them across the continent
would make the African biomass industry more sustainable.
The increase in demand for energy services brought about by the fast-growing and rapidly
urbanising population across the continent will have significant implications for air quality
in cities. The increase in the overall level of air pollutant emissions in the Stated Policies

Scenario is not a surprise, given the exceptionally low baseline for current energy
consumption. The mix of technologies and fuels chosen by consumers can however play an
important part in mitigating the increase of pollutant emissions, which will ultimately have
wide-ranging implications for the health and wellbeing for millions of people.
In the Stated Policies Scenario, sulfur dioxide (SO2) emissions decrease by a quarter across
Africa by 2040. There is an increase in industrial emissions but this is more than offset by a
significant decrease in emissions from coal-fired power plants, mainly in South Africa.
Emissions of nitrogen oxides (NOX) increase by one-quarter, mainly from the incomplete
combustion of fuels in cars, despite a significant fall in emissions in the power sector during
the period to 2040. In the Africa Case, improved emissions standards for passenger vehicles
result in emissions from this segment falling, despite the increased number of cars on the
road.
Figure 5.10 ⊳ Population exposed to fine particulate pollution (PM2.5) in

selected regions in the Stated Policies Scenario and Africa Case
5
China European United
Union States
2018
2040
2018
2040
2018
2040
India
2018
2040
Southeast
2018
Asia
2040
2018
Africa
2040
2040 AC
20% 40% 60% 80% 100%

Exceeds interim Interim target 1 Interim target 2 Interim target 3 Air quality guideline
targets (>35 μg/m³) (25-35 μg/m³) (15-25 μg/m³) (10-15 μg/m³) (<10 μg/m³)
Proportion of the population in Africa exposed to high levels of PM2.5 pollution drops in the
Africa Case and remains lower than in some Asian countries in the Stated Policies Scenario
Notes: AC = Africa Case; μg/m3 = micrograms per cubic metre. Interim targets and Air Quality Guideline refer
to World Health Organization exposure thresholds.
Source: International Institute for Applied Systems Analysis

Higher emissions of NOx and PM2.5 also take a considerable toll on health and wellbeing. In
the Stated Policies Scenario, the increasing concentration of PM2.5 by 2040 means that the
number of premature deaths associated with outdoor air pollution increases by almost
60%, reaching 480 000 in 2040. In the Africa Case, emissions of the three major air
pollutants decline sharply from the current levels. Reduced exposure to PM2.5 is particularly
important: despite a significant increase in energy services, the number of premature
deaths associated with outdoor air pollution in 2040 is almost 30% lower than in the Stated
Policies Scenario.
5.2.4 Achieving sustainable development goals requires Africa’s success

In many areas, global energy transition goals are closely linked to successful growth and
development in Africa. The continent’s economic and social prosperity are in turn closely
linked to successful global energy transitions. Two examples highlight the interlinkages
between the world and Africa: first, access to modern energy services; and second, Africa’s
role as a major supplier of the minerals necessary to achieve the global energy transition.
More than two-thirds of the world’s population without access to electricity and around a
third of the population without access to clean cooking live in Africa. By 2030 in the Stated
Policies Scenario, most of the remaining population without access to electricity and clean
cooking remain concentrated in Africa. Addressing energy access in Africa is therefore of
paramount importance to solving this global concern.
Boosting energy access rates in Africa brings huge benefits in terms of reduced poverty,
lower air pollution and increased economic prosperity. Access to electricity is crucial to the
provision of essential services: in health centres, for instance, it is vital for the use of
efficient modern equipment, the storage and preservation of vaccines and medicines, and
the ability to conduct emergency medical procedures, for example during child birth.
Access to clean cooking is essential to reduce the health impacts and the number of
premature deaths related to household air pollution.
In the Stated Policies Scenario, around 20 million people are connected to the electricity
network each year, which is less than a third of what would be needed to reach full access
by 2030. By 2030, 85% of all people without access to electricity live in Africa (Figure 5.11).
In DR Congo, for example, the projected number of people without access to electricity
increases by 30% in this scenario, as policies fail to keep pace with population growth.
Reaching full electricity access by 2030 as envisaged in the Africa Case requires a tripling of
efforts to extend connection to over 60 million people each year. Reaching this level of
access would need an additional push for decentralised renewables in the context of a
comprehensive set of policies and investments that makes use of all available solutions,
with mini-grids and stand-alone systems providing power to more than half of those
gaining access by 2030. Energy efficiency also has an important part to play.
Delivering access to clean energy in an integrated way would also support economic
growth and overall development. Research suggests that access could bring new avenues

of productive employment to remote populations, particularly for women. In addition to
freeing up time by speeding up domestic chores and giving women more time to engage in
paid jobs, access to electricity can have a particular impact on female-owned businesses,
helping them to transition from extreme poverty to near middle-class status, as shown
recently in Ghana (Power Africa, 2019).
Figure 5.11 ⊳ Share of population without access to electricity and clean

cooking by region in the Stated Policies Scenario
Without electricity access Without clean cooking access

100%
80%
60%
40%
5
20%
2010 2018 2030 2040 2010 2018 2030 2040

Africa India Southeast Asia Other developing Asia Rest of world
Those without access to electricity and clean cooking are

increasingly concentrated on the African continent
Moreover, electricity can also play an important role in improving agricultural productivity
through advanced irrigation techniques, as several successful examples of stand-alone solar
water pumps have demonstrated. Cold storage powered by renewable electricity could also
reduce post-harvest losses of agricultural outputs, which are currently estimated at 20-50%
of the food produced in sub-Saharan Africa (depending on the food type).
In the Stated Policies Scenario, Africa is one of the few regions where the number of people
without access to clean cooking increases, as the expansion of clean cooking is unable to
keep pace with rapid population growth, and around half of the global population without
access to clean cooking in 2040 lives in Africa. There are exceptions: Ghana sees a visible
improvement in this area, but many other countries are not set to emulate this example.
While urbanisation increases the use of alternative options such as LPG and natural gas in
many regions, solid biomass (in the form of charcoal) remains the preferred option for
cooking in African cities. The Africa Case sees all households across the continent gain
access to clean cooking by 2030. This reduces significantly the number of premature deaths
linked to indoor air pollution.

Resource development, minerals in particular, is another area where Africa and the world
share a common interest. From cobalt and manganese for batteries to chromium and

neodymium for wind turbines, and to platinum for hydrogen fuel cells, minerals are a
critical component in many clean energy technologies. As energy transitions accelerate,
demand for minerals is set to grow significantly. For example, demand for cobalt from
deployment of electric vehicles increases to around 170 kilotonnes per year (kt/year) in
2030 in the Stated Policies Scenario, higher than today’s supply capacity, and to almost
360 kt/year in the case of higher electric vehicle uptake (IEA, 2019). Africa is a major
producer of many of these minerals: DR Congo accounts for two-thirds of global cobalt
production and South Africa produces 70% of the world’s platinum.
In 2017, net income from mineral production was equivalent to around 2% of sub-Saharan
Africa’s GDP and minerals accounted for some 20% of total merchandise exports in Africa
(77% in the case of DR Congo). Rising demand for minerals means that successful global
energy transitions offer an opportunity for economic growth in mineral-rich countries in
Africa. For example, if DR Congo were to maintain today’s share in global production,
growing global demand for cobalt would bring additional revenue of $4-8 billion to the
country in 2030 (based on today’s prices), equivalent to around 3-6% of the country’s
projected GDP in that year.
However, there are large question marks over whether African countries can keep up with
rising global demand in a timely and sustainable manner. Current practices are often
inefficient, polluting and subject to social protests. Given that African countries account for
a large proportion of the global production of key minerals, failure to keep up with demand
could not only hamper Africa’s economic outcomes but also hold back the pace of global
energy transitions (Figure 5.12).
Figure 5.12 ⊳ Composition of Africa’s merchandise exports, 2017, and key

minerals production, 2018
Share of minerals in merchandise exports
DR Congo Minerals
South Africa Other
Africa
Share of Africa in key minerals production

Cobalt Africa
Manganese Rest of
world
Platinum
20% 40% 60% 80% 100%

Responsible and sustainable development of Africa’s mineral resources

is vital for Africa’s economic prosperity and global energy transitions
Source: IEA analysis based on UNCTAD Stats (2019) and USGS (2019).

Putting in place structures and governance arrangements to ensure responsible minerals
development would help guard against a range of potential problems. Robust regulatory
and oversight mechanisms would be needed to ensure that impacts on local environments
are minimised and that revenues are used in a transparent manner. There is also a need for
careful scrutiny of how minerals are sourced and how supply chains are managed. Those
who use minerals can play a helpful role, as can international financial institutions. For
example, BMW, BASF and Samsung recently launched a pilot initiative to support
sustainable and fair cobalt mining in DR Congo, which aims to improve working and living
conditions for small-scale mining operations and surrounding communities. The World
Bank has launched the Climate-Smart Mining Facility to help minimise the environmental
and climate impacts of mining activities. As in so many other areas, the future of Africa’s
development and the prospects for global sustainable growth are closely interlinked.
5

Chapter 6
Regional and country energy profiles

The following section presents the results of the Stated Policies Scenario and Africa Case for
the sub-Saharan region as a whole as well as for the following eleven countries:
6.1 Sub-Saharan Africa P208
6.2 Angola P212
6.3 Côte d’Ivoire P216
6.4 Democratic Republic of the Congo P220
6.5 Ethiopia P224
6.6 Ghana P228
6.7 Kenya P232
6.8 Mozambique P236
6.9 Nigeria P240
6.10 Senegal P244
6.11 South Africa P248
6.12 Tanzania P252
Together these eleven countries accounted for three-quarters of sub-Saharan Africa’s gross
domestic product (GDP), two-thirds of its population and three-quarters of its energy
demand in 2018. The profiles presented in this section aim to provide decision makers with
a data-rich set of information on potential energy pathways that reflect each country’s
unique energy demand and supply needs and regional characteristics. The policy,
technology and economic assumptions that underpin both the Stated Policies Scenario and
the Africa Case are described in the introduction to the Special Focus and discussed on a
regional basis in Chapters 2, 3 and 4, with the implications presented in Chapter 5.
How to read the profiles:
We use a standard format to present the country and regional profiles. Each profile
contains a set of figures and tables corresponding to the following categories:
 Key characteristics of the country’s energy system.
 Major macroeconomic indicators, including GDP and population growth, carbon
dioxide (CO2) emissions and data for electricity access and clean cooking access by
scenario.
 Description of energy-related policy initiatives, including specific performance targets.
 Outlook of how primary energy demand and GDP (based on GDP expressed in year-
2018 dollars in purchasing power parity [PPP] terms) evolve to 2040 and the role of
each fuel in delivering the alternative energy futures.
 View of how the electricity mix changes over time to meet growing electricity demand.
 Final energy consumption by scenario, showing the potential efficiency gains achieved
by implementing more stringent fuel economy standards, building codes, equipment
and appliance efficiency requirements.
Chapter 6 | Regional and country energy profiles 205

 Fuel and technology mix1 used in cooking in 2018 and in 2030 by scenario.2
 The trajectory for demand and production of major fossil fuels, highlighting trade balances.
 Cumulative investment by sector required to meet the growth in energy demand and
supply in both the Stated Policies Scenario and the Africa Case.3
Figure 6.1 ⊳ Focus countries for the Africa Energy Outlook by share of sub-
Saharan African primary energy demand
1
Other clean includes electricity, natural gas, biogas and biofuels. Charcoal and other solid biomass refer to
the combustion of these fuels in inefficient stoves.
2
More detailed information on the methodology can be found in Chapter 2.
3
Investment in electricity networks and generation excludes investment in electricity access, which is
counted separately in this figure.

Notes to profiles:
Scenarios: AC = Africa Case; STEPS = Stated Policies Scenario.
End-use sectors are industry (including manufacturing and mining), transport, buildings
(including residential and services) and other (including agriculture and non-energy use).
Traditional use of solid biomass refers to the use of solid biomass with basic technologies,
such as a three-stone fire, often with no or poorly operating chimneys.
Productive uses refers to energy used towards an economic purpose. This includes energy
used in agriculture, industry, services and non-energy use. Some energy demand from the
transport sector (e.g. freight-related) could be considered as productive, but is treated
separately.
GIS maps for each country or region contained in these profiles were developed in
collaboration with the Royal Institute of Technology (Sweden) – Division of Energy Systems
Analysis (KTH-dESA). The maps detail the least-cost pathway to deliver universal electricity
access by means of a combination of on-grid, mini-grid and stand-alone systems. 4
Units and terms: GDP = gross domestic product; CAAGR = compound average annual
growth rate; PPP = purchasing power parity; Mt CO2 = million tonnes of carbon dioxide;
Mtoe = million tonnes of oil equivalent; GW = gigawatt; TWh = terawatt-hour; kV = kilovolt; 6
LPG = liquefied petroleum gas; mb/d = million barrels per day; Mtce = million tonnes of coal
equivalent; bcm = billion cubic metres, PV = photovoltaics, GHG = greenhouse gas.
Investment data are presented in real terms in year-2018 US dollars.

4
More detailed information on the methodology can be found in Chapter 3, Box 3.2.

6.1 Sub-Saharan Africa1
Fastest growing population Strong economic growth Major commodities exporter
Table 6.1A ⊳ Sub-Saharan Africa key indicators and policy initiatives

Stated Policies Africa Case CAAGR 2018-40
2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 1 375 3 536 6 161 10 346 8 381 16 683 5.0% 7.3%
Population (million) 626 1 034 1 404 1 761 1 404 1 761 2.5% 2.5%
with electricity access 20% 43% 62% 66% 100% 100% 2.0% 4.0%
with access to clean cooking 6% 13% 31% 51% 100% 100% 6.3% 9.6%
CO2 emissions (Mt CO2) 130 312 534 843 762 1 154 4.6% 6.1%
Policy Key targets and measures

Regional  Agenda 2063: A prosperous Africa based on inclusive growth and sustainable
Strategies development.
 African Continental Free Trade Area: accelerating intra-African trade and boosting
Africa’s trading position in the global market by strengthening Africa’s common voice
and policy space in global trade negotiations.
 Drastic efficiency improvements, in part due to the accelerated move away from solid
biomass, result in primary energy demand being lower in the AC than in the STEPS
even though GDP is 60% higher in the AC.
 Supply from natural gas and renewable sources expand in both scenarios to meet
rising demand for energy as the sub-Saharan economy expands.
 Electricity access and clean cooking facilities for all are achieved by 2030 in the AC.
Figure 6.1A ⊳ Sub-Saharan Africa primary energy demand and GDP

1 000 20 Bioenergy
Trillion dollars (2018)
Mtoe
Other low-carbon
800 16 Solar PV
Hydro
600 12 Gas
Oil
400 8 Coal
GDP (right axis)
200 4
2010 2018 2030 2040 2010 2018 2030 2040
1
Excluding South Africa.

Figure 6.1B ⊳ Sub-Saharan Africa electricity generation by technology

2 000
TWh
1 500
1 000
500
2010 2020 2030 2040 2010 2020 2030 2040

Coal Oil Back-up generators Gas Hydro Wind Solar PV Bioenergy Other renewables
 Today’s power mix, dominated by hydro, gradually diversifies as solar PV and natural
gas increasingly make inroads into the power system. In the STEPS, the combined
share of solar PV and natural gas reaches the level of hydro by 2040.
 In the AC, natural gas (27%) passes hydropower (26%) as the largest source of power
supply by 2040 while the share of solar PV rises to 24%. 6
Figure 6.1C ⊳ Sub-Saharan Africa electricity access solutions by type in the
Africa Case
New connections by 2030

On-grid
Mini-grids
Stand-alone systems
Transmission lines (>69 kV)

Existing
Planned
 In the STEPS, the main grid connects around 70% of the 230 million people gaining
electricity access by 2030, alongside decentralised options for the remainder in more
remote areas. In 2030, 530 million people remain without access.
 In the AC, decentralised solutions are the least-cost option for more than two-thirds of
the 530 million additional people connected by 2030 to reach full access.

Figure 6.1D ⊳ Sub-Saharan Africa final energy consumption

Mtoe
Productive uses
300
Transport
200 Residential
Demand changes
100
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Growing trends of urbanisation and industrialisation drive strong energy consumption

growth for transport and productive uses in both the STEPS and the AC, increasing oil
demand the most, especially in the AC, which sees faster economic growth.
 Electricity consumption is very low today, but quadruples through to 2040 in the
STEPS, with demand growth led by light industry, appliances and cooling systems.
Demand rises further in the AC.
Figure 6.1E ⊳ Sub-Saharan Africa fuels & technologies used for cooking

1 034 million people 1 404 million people 1 404 million people
5% 9%
8% 17% 14%
5% 26%
15% 37%
8%
4%
50%
65% 37%
Charcoal Other solid biomass Coal and kerosene Improved cookstoves LPG Other clean
 In the STEPS, more people gain access to clean fuels and technologies for cooking by
2030, but 70% of the population still lack access.
 To bridge the gap and achieve full access to clean cooking for all in the AC, liquefied
petroleum gas (LPG) is the most scalable solution for urban settlements, with
improved biomass cookstoves doing most to provide access in rural areas.

Figure 6.1F ⊳ Sub-Saharan Africa fossil fuel demand and production
Coal (Mtce) Oil (mb/d) Gas (bcm)

75 6 300
50 4 200
25 2 100
2010 2040 2010 2040 2010 2040

Demand Production Stated Policies Africa Case
 Rapidly growing oil demand and stagnating domestic oil production reduce net oil
exports in the STEPS; exports are further reduced by faster economic growth in the AC.
 Gas demand and production increase by 2040 in the STEPS, but both grow more
rapidly in the AC and the region becomes a major supplier of gas to global markets.
Figure 6.1G ⊳ Sub-Saharan Africa cumulative investment needs, 2019-2040

6
500 1 000 1 500 2 000 2 500 3 000 3 500
Stated Policies
Africa Case
Fuel production Oil Gas
Power Fossil fuels Renewables Networks
Access to electricity to clean cooking
 In the STEPS, $1.8 trillion of cumulative energy supply investment is needed, with
upstream oil and gas and power each accounting for around half of this.
 The AC requires 80% more capital with a stronger emphasis on power sector
investments, including a doubling of spending in renewables and electricity networks.
Sub-Saharan Africa policy opportunities

 Enhanced power sector integration in sub-Saharan Africa could help to deliver more
affordable and reliable power and reduce average electricity generation costs.
 Challenges relating to infrastructure, affordability and business models must be
overcome if the region is to capitalise on the potential of natural gas.
 More efficient use of energy across end-use sectors such as fuel economy standards
for cars and two/three-wheelers, building codes for new buildings, and more efficient
industrial processes and efficiency standards for appliances and cooling systems would
support wider economic development and offset growth in energy demand.

6.2 Angola
Second-largest oil producer Oil accounts for 90% of exports Luanda: future megacity
Table 6.2A ⊳ Angola key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 72 199 287 404 349 625 3.3% 5.3%
Population (million) 16 31 45 60 45 60 3.1% 3.1%
CO2 emissions (Mt CO2) 5 17 20 33 27 48 3.1% 4.8%

Performance  Establish targets for renewable energy sources to 2025: 100 MW of solar PV; 370 MW
targets of small and medium hydro; 500 MW of biomass; 100 MW of wind.
 Up to 35% (unconditional) to 50% (conditional) reduction in GHG emissions by 2030 as
compared to the business-as-usual scenario.
Industrial  National Development Plan of Angola 2018-2022: Lessen economic dependence on oil
development and natural gas revenues, strengthen the business environment, increase energy
targets efficiency and achieve middle-income status by 2022.
 Angola could supply an economy three-times larger than today’s in the AC with only
twice the amount of energy.
 Oil remains an important energy source, but end-use tariffs that are more reflective of
costs reduce its share of the overall energy mix and help diversification towards
natural gas and renewables in the AC.
Figure 6.2A ⊳ Angola primary energy demand and GDP

40 800 Bioenergy
Mtoe
Other low-carbon
Solar PV
30 600
Hydro
Gas
20 400 Oil
Coal
GDP (right axis)
10 200
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.2B ⊳ Angola electricity generation by technology

80
TWh
60
40
20
2010 2020 2030 2040 2010 2020 2030 2040
 Angola currently relies mostly on hydropower and oil (including diesel) for power
generation.
 Providing access to all increases electricity demand sevenfold in the AC. Gas and
comparatively cheap hydropower play key roles in meeting this growth along with
solar PV. 6
Figure 6.2C ⊳ Angola electricity access solutions by type in the Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 The electricity access rate in Angola is 44% today, with most of the population
currently without access located in the west of the country.

 The least-cost path to full access to electricity in the AC is mini-grids (46%), alongside
grid connections for a large part of the population (38%) living near the existing and
planned grids; stand-alone systems help to reach the most remote areas.

Figure 6.2D ⊳ Angola final energy consumption

Mtoe
Productive uses
9
Transport
Residential
6
Demand changes
3
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 The number of cars expands from 0.4 million in 2018 to 1.1 million in 2040 in the
STEPS, and rises further in the AC. The associated increase in oil demand can be
mitigated to an extent by improving fuel economy standards.
 Angola could meet nearly all of its cement demand domestically before 2040 in both
scenarios provided a reliable supply of gas and electricity is available.
Figure 6.2E ⊳ Angola fuels and technologies used for cooking

31 million people 45 million people 45 million people
15% 15%
24%
28%
37% 39%
26%
34%
26% 17%
13% 24%
1%
1%
 Angola has one of the highest shares of access to clean cooking in sub-Saharan Africa,
thanks to government policies supporting LPG and natural gas.
A further push on access policies adapted to rural conditions could help provide clean

cooking to 90% of people in rural areas through improved biomass cookstoves in the
AC.

Figure 6.2F ⊳ Angola fossil fuel demand and production

0.75 3 30
0.50 2 20
0.25 1 10
2010 2040 2010 2040 2010 2040

 Recent policy reforms in the oil and gas sector help stabilise the outlook for oil
production in both scenarios.
 Growing population and stagnant oil production reduce per capita net income from oil
and gas production in both scenarios, increasing the need for economic diversification.
Figure 6.2G ⊳ Angola cumulative investment needs, 2019-2040

6
100 200 300 400
Stated Policies
Africa Case
 Around $240 billion of cumulative energy supply investment is needed in the STEPS, of
which over 80% goes to upstream oil and gas.
 The AC requires around 25% more capital than the STEPS, with a strong emphasis on
investments in upstream gas, electricity access and networks.
Angola policy opportunities

 Angola’s natural gas resources could underpin a domestic industrial base that would
have the added benefit of diversifying the economy away from oil exports.
 Angola would benefit from sustaining and strengthening recent reforms in the oil and
gas sector, including efforts to streamline investment procedures and restructure the
role of the national oil company.

 The availability of domestic natural gas presents a significant opportunity for efficient
and dependable electricity generation.

6.3 Côte d’Ivoire
Largest cocoa exporter Rapidly expanding economy Diversity of resources
Table 6.3A ⊳ Côte d’Ivoire key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 56 107 221 330 264 569 5.3% 7.9%

Performance  Increase electricity generation to 4 000 MW by 2020 and 6 000 MW by 2030.
targets  Programme National d'Électrification Rurale: connect all localities with more than
500 inhabitants by 2021 and all areas by 2025.
Industrial  Achieve emerging economy status by end of 2020 while ensuring that industry accounts
development for 40% of the economy.
targets  Accelerate the structural transformation of the economy through industrialisation,
develop infrastructure throughout the country and protect the environment.
 Rise in investment rate from 19.3% in 2015 of GDP to 24.5% in 2020 with significant
contribution from private sector.
 Rapid industrialisation in the AC could yield an economy that is five-times larger than
today but with energy efficiency the country consumes only twice as much energy.
 Natural gas has a key role to play in electricity generation in the AC. Promoting its use
could see its share of the energy mix rising by eleven percentage points more than
STEPS.
Figure 6.3A ⊳ Côte d’Ivoire primary energy demand and GDP

20 600 Bioenergy
Mtoe
Other low-carbon
15 450 Solar PV
Hydro
Gas
10 300 Oil
Coal
5 150 GDP (right axis)
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.3B ⊳ Côte d’Ivoire electricity generation by technology

60
TWh
40
20
2010 2020 2030 2040 2010 2020 2030 2040
 Providing access to all and increasing industrialisation in the AC raises electricity

demand sixfold compared to today.
 Gas continues to play a large role in power generation, but its share is reduced from
three-quarters today to around 45% as solar and bioenergy increase in both scenarios.
6
Figure 6.3C ⊳ Côte d’Ivoire electricity access solutions by type in the
Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Effective programmes supporting electrification of villages and households connect

more than 90% of the population by 2030 in the STEPS.
 Given the current coverage of the grid network, grid densification and grid extension
are the least-cost solution for around 40% of the population in the AC.

Figure 6.3D ⊳ Côte d’Ivoire final energy consumption

8 Final consumption
Mtoe
Productive uses
6
Transport
Residential
4
Demand changes
2
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 The number of cars grows fivefold and related oil consumption fourfold in the AC, but
the growth could be almost 20% larger without fuel economy standards.
 Côte d’Ivoire electrifies much of industry, with electricity displacing oil to become the
major fuel. Electricity demand for residential cooling increases by almost 2 TWh in the
AC.
Figure 6.3E ⊳ Côte d’Ivoire fuels and technologies used for cooking

2%
13% 9% 8%
5%
8%
31%
28%
55% 1%
4%
50%
84%
2%
0%
 With strong policy support, LPG is the preferred solution to improve access to clean
cooking, reducing the use of traditional stoves with charcoal and other solid biomass.
 The AC sees further use of LPG and improved biomass cookstoves, particularly in rural
areas, to bring access to clean cooking to all.

Figure 6.3F ⊳ Côte d’Ivoire fossil fuel demand and production

1.5 0.15 9
1.0 0.10 6
0.5 0.05 3
2010 2040 2010 2040 2010 2040

 Rapidly rising passenger car stocks and declining production lead to expanding import
requirements for oil in both scenarios.
 Given the important share of gas in the power mix, strong growth in electricity
demand underpins rapid growth in gas demand, especially in the AC.
Figure 6.3G ⊳ Côte d’Ivoire cumulative investment needs, 2019-2040

6
20 40 60
Stated Policies
Africa Case
 Energy investment needs amount to $33 billion through to 2040 in the STEPS, with
spending on electricity networks representing almost 40% of the total.
 The AC requires investment to increase by a further 80%, with more emphasis on gas-
related spending (upstream and generation), renewables and electricity networks.
Côte d’Ivoire policy opportunities

 Increased production of natural gas provides a significant opportunity for it to be used
extensively in power generation and industry.
 Prioritising energy efficiency is essential to helping Côte d’Ivoire make the most of its
limited resources. With the anticipated increase in demand for cooling and other
household uses, efficiency standards for appliances would materially impact the rate
of energy demand growth.
 Expanding power generation capacity is crucial.

6.4 Democratic Republic of the Congo
Largest producer of cobalt Kinshasa: an African megacity Most ambitious hydro plan
Table 6.4A ⊳ DR Congo key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 29 73 132 238 195 455 5.5% 8.7%

Performance  Complete the construction of Inga 3 Basse-Chute dam.
targets  Reduce GHG emissions by 17% by 2030 compared to the business-as-usual scenario
(430 Mt CO2-equivalent), equivalent to slightly more than a 70 Mt CO2 reduction.
 Plant about three million hectares of forest by 2025.
Industrial  Achieve high-income status by 2050 by means of rigorous implementation of the
development National Strategic Plan for Development.
targets
 In the AC, DR Congo supports an economy six-times larger than today’s with only 35%
more energy by diversifying its energy mix away from one that is 95% dependent on
bioenergy.
 The power sector sees more growth than any other sector; a big increase in the use of
hydropower leads to its share of the overall energy mix increasing to 23% in the AC.
Figure 6.4A ⊳ DR Congo primary energy demand and GDP

60 600 Bioenergy
Mtoe
Other low-carbon
Solar PV
Hydro
40 400
Gas
Oil
Coal
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.4B ⊳ DR Congo electricity generation by technology

160
TWh
120
80
40
2010 2020 2030 2040 2010 2020 2030 2040

 Almost all electricity generation today comes from hydropower and the Inga project
has the potential to provide much more. If network constraints are addressed, DR
Congo could become an electricity exporter.
 In the AC, Phase 5 of the Inga project enables DR Congo to meet an eleven-fold
increase in electricity demand; this increase is the result of achieving full access to 6
electricity and of the growing electrification of productive uses.
Figure 6.4C ⊳ DR Congo electricity access solutions by type in the Africa

Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Less than 10% of the population has access to electricity today, making DR Congo the
country with the largest number of people without access in Africa after Nigeria.
 Mini-grids account for more than half of all new connections in the AC.

Figure 6.4D ⊳ DR Congo final energy consumption

Mtoe
Productive uses
12
Transport
Residential
8
Demand changes
4
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Oil use in industry increases significantly in the AC with manufacturing and mining
chiefly responsible for this growth.
 Electricity consumption is low today but is set to increase significantly in the AC as
household incomes rise, access to electricity improves and mining activities increase.
Figure 6.4E ⊳ DR Congo fuels and technologies used for cooking

3% 1%
2%
35% 15%
40%
20%
65%
62% 57%
 Given the availability of fuelwood in rural areas and the affordability of charcoal in
urban areas, almost all people cook with traditional stoves in 2030 in the STEPS.
 In the AC, improved cookstoves are the preferred option to provide clean cooking
access in both urban and rural areas. In parallel, kilns for making charcoal are
improved to increase their efficiency.

Figure 6.4F ⊳ DR Congo fossil fuel demand and production

3.0 0.3 0.3
2.0 0.2 0.2
1.0 0.1 0.1
2010 2040 2010 2040 2010 2040

 Fossil fuel consumption is at a low level, but growing, and almost reliant on imports in
both scenarios. Further industrial development depends on a large increase in imports.
 DR Congo is a major producer of minerals. It accounts for almost two-thirds of global
cobalt production; this gives it a crucial role in global clean energy transitions.
Figure 6.4G ⊳ DR Congo cumulative investment needs, 2019-2040

6
50 100 150 200
Stated Policies
Africa Case
 The AC requires a quadrupling of investment compared with the STEPS, with emphasis
on renewables, power networks and access to electricity and clean cooking.
 Investment opportunities in the AC are likely to be realised only if sound structures to
regulate the sector and manage revenues from mineral production are in place.
DR Congo policy opportunities
 Cobalt mining activities will drive an increase in electricity demand. Meeting this
through renewable hydropower would help to develop low-carbon electricity for DR
Congo and a low-carbon value chain for the global electric vehicle fleet.
 Given the country’s dispersed population centres, decentralised solutions offer the
lowest cost way to overcome grid limitations and provide electricity access to the huge
share of the population currently without it.

 Increased regional co-operation could help realise the potential of Inga, which has the
potential to provide large quantities of reliable low-carbon electricity to DR Congo and
its neighbours.

6.5 Ethiopia
Geothermal potential Large hydro capacity Strong progress on access
Table 6.5A ⊳ Ethiopia key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 47 220 493 870 610 1 445 6.5% 8.9%

Performance  Increase generating capacity by 25 000 MW by 2030: 22 000 MW of hydro; 1 000 MW
targets of geothermal; and 2 000 MW of wind by 2030.
 National Electrification Program (2017): 100% electrification in 2025, with 35% off-grid
and 65% grid, while extending the grid to reach 96% grid connections by 2030.
Industrial  Achieve an annual average real GDP growth rate of 11% within a stable macroeconomic
development environment and become a lower middle-income country by 2025.
targets  Focus on ensuring rapid, sustainable growth by enhancing the productivity of the
agriculture and manufacturing sectors, and stimulating competition in the economy.
 Ethiopia could supply a much larger economy than today in the AC, using only twice
the energy, were it to diversify its energy mix and implement efficiency standards.
 In the AC, this diversification comes about as a result of a substantial expansion of
geothermal energy along with increased use of oil within industry and for cooking.
Figure 6.5A ⊳ Ethiopia primary energy demand and GDP

80 1 600 Bioenergy
Mtoe
Other low-carbon
60 1 200 Solar PV
Hydro
Gas
40 800 Oil
Coal
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.5B ⊳ Ethiopia electricity generation by technology

160
TWh
120
80
40
2010 2020 2030 2040 2010 2020 2030 2040
 Ethiopia is currently heavily reliant on hydropower; plans to increase capacity to

13.5 GW by 2040 would make Ethiopia the second-largest hydro producer in Africa.
 Providing electricity access to all and electrifying productive uses will lead to a fivefold
increase in generation in the STEPS, and an even bigger increase in the AC; solar PV
and geothermal account for almost 45% of the power mix by 2040 in the AC. 6
Figure 6.5C ⊳ Ethiopia electricity access solutions by type in the Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Ethiopia currently has an electricity access rate of 45%, 11% of its population already
have access through decentralised solutions. Strong government commitment to reach

full access before 2030 in the STEPS.
 In both scenarios, around 80% of new connections are cost effectively delivered by
grid densification and extension as a large part of the population lives close to the grid.

Figure 6.5D ⊳ Ethiopia final energy consumption

Mtoe
Productive uses
18 Transport
Residential
12
Demand changes
6 Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Increased affluence in the STEPS results in a more than fourfold increase of the private
vehicle stock with the number of cars reaching 700 000 by 2040. This results in a 300%
increase in related oil consumption.
 To meet the needs of its growing population, Ethiopia remains a large producer of
cement causing energy demand to increase significantly in both scenarios.
Figure 6.5E ⊳ Ethiopia fuels and technologies used for cooking

1%
7% 8% 6%
18%
3% 40%
51%
12%
60%
1%
84% 9%
 In the STEPS, a push on improved and advanced biomass cookstoves alongside more
access through LPG and electricity increases the population with access by 40 million
by 2030, with 60% of this increase takes place in rural areas.

 In the AC, increased efforts using the same solutions bring access to clean cooking by
2030 to the remaining 95 million people that rely on the traditional use of biomass.

Figure 6.5F ⊳ Ethiopia fossil fuel demand and production

7.5 0.3 6
5.0 0.2 4
2.5 0.1 2
2010 2040 2010 2040 2010 2040

 Growing fossil fuel consumption is met almost entirely by imports in both scenarios.
 A high degree of dependency on imported fuels in both scenarios and a range of
infrastructure development challenges underline the case for the development of
hydropower and other renewables.
Figure 6.5G ⊳ Ethiopia cumulative investment needs, 2019-2040
Billion dollars (2018) 6

50 100 150 200
Stated Policies
Africa Case
 Cumulative energy investment of $100 billion is needed in the STEPS, with electricity
access and networks taking the majority.
 The AC needs around 80% more capital, including a doubling of investments in
renewables and electricity networks compared with the STEPS.
Ethiopia policy opportunities

 Ethiopia will remain heavily dependent on fossil fuel imports. In both scenarios,
imports of oil and coal increase; a significant increase in gas consumption (and
imports) would help the country to make the most of its industrial potential.
 The need for energy imports could be reduced by a determined push to develop the
country’s formidable hydro resources and accelerate electrification, as well as by
development of its more limited natural gas reserves.
 Continuing progress on access means that fully achieving SDG 7 is well within
Ethiopia’s reach. Most of the additional connections to 2025 can be made through
extending the current grid.

6.6 Ghana
Oil and gas producer Strong access record Steel producer
Table 6.6A ⊳ Ghana key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 63 191 322 438 403 728 3.9% 6.3%

Performance  Accelerate the displacement of light crude oil by natural gas in electricity generation.
targets  Achieve 10% renewable energy in the national energy mix and 20% solar energy in
agriculture by 2020.
 15% (unconditional) to 45% (conditional) reduction in GHG emissions by
2030 compared to the business-as-usual scenario (around 74 Mt CO2 -equivalent).
Industrial  Produce and process estimated reserves of 300 million barrels of oil and gas by 2040.
development  In accordance with the One District, One Factory Initiative, build a factory in each of
targets the 216 districts across the country.
 Supplying an economy that is four-times the size of today's could require only three-
times more energy with the implementation of efficiency standards in the AC.
 Oil remains the largest energy source in both scenarios, with nearly two-thirds of it
consumed in the transport sector.
Figure 6.6A ⊳ Ghana primary energy demand and GDP

30 900 Bioenergy
Mtoe
Other low-carbon
Solar PV
20 600 Hydro
Gas
Oil
Coal
10 300
GDP (right axis)
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.6B ⊳ Ghana electricity generation by technology

80
TWh
60
40
20
2010 2020 2030 2040 2010 2020 2030 2040
 Almost half of today’s electricity comes from hydropower; the rest comes from
domestically produced gas (30%) and oil (23%).
 The 350% increase of electricity demand in the STEPS is met by increasing generation
from gas, which accounts for nearly half of the power mix by 2040, and from solar PV.
6
Figure 6.6C ⊳ Ghana electricity access solutions by type in the Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Thanks to strong government leadership since the 1990s, Ghana had an electricity
access rate of 84% in 2018, one of the highest in sub-Saharan Africa.
 To reach the remaining population, grid densification (58% of the new connections)
and stand-alone systems (27%) are the two main least-cost solutions in both scenarios.

Figure 6.6D ⊳ Ghana final energy consumption

Mtoe
Productive uses
Transport
10
Residential
5 Demand changes
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Two/three-wheelers remain important for passenger transport; in the STEPS, an

increasing number of buses accounts for nearly 70% of oil demand growth for
transport.
 Millions of additional appliances and cooling systems together with the further
development of bauxite mining, and steel and aluminium industries are responsible for
two-thirds of the additional 45 TWh of electricity demand in the AC; around 10 TWh
are avoided thanks to efficiency standards.
Figure 6.6E ⊳ Ghana fuels and technologies used for cooking

1%
7% 12%
39% 20%
24% 28% 45%
22%
43%
36% 23%
 In the STEPS, strong policies support the provision of clean cooking fuels to more than
half of the population mainly through deployment of LPG and improved cookstoves.
 In the AC, 16 million people who still lack access to electricity in 2030 under the STEPS
gain access through LPG, biogas or improved cookstoves.

Figure 6.6F ⊳ Ghana fossil fuel demand and production

0.03 0.3 9
0.02 0.2 6
0.01 0.1 3
2010 2040 2010 2040 2010 2040

 Ghana remains a relatively minor producer of oil and gas in Africa.

 Gas demand grows strongly in the AC, lowering oil use in the power and industry
sectors; this increases the need for imports of gas.
Figure 6.6G ⊳ Ghana cumulative investment needs, 2019-2040

20 40 60 80 100 120
6
Stated Policies
Africa Case
 Around $70 billion of cumulative energy supply investment is needed in the STEPS,
60% of which is for upstream oil and gas.
 Investment ramps up by nearly 45% in the AC, with a strong emphasis on renewables
and electricity networks.
Ghana policy opportunities

 Thanks to notable efforts on electrification, the goal of full access is within grasp in
Ghana. A mix of grid extension and stand-alone solutions would be the least-cost way
to reach the decreasing share of the population that remains without access.
 Taking action to arrest (and reverse) declining oil output would reduce Ghana’s
reliance on imports to meet its growing future demand while a renewed push on
developing domestic natural gas resources would help Ghana meet its accelerating
industrial power needs.

 The government needs to develop and implement stronger efficiency policies if the
potential savings identified in the AC are to be realised.

6.7 Kenya
Major access improvements Large wind power producer Largest geothermal producer
Table 6.7A ⊳ Kenya key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 76 177 358 627 453 1 176 5.9% 9.0%

Performance  National Electrification Strategy: achieve universal electricity service to all households
targets and businesses by 2022 at acceptable quality of service levels.
 Produce 100 000 barrels of oil per day from 2022 and develop 2 275 MW of geothermal
capacity by 2030.
Industrial  Increase the contribution of the manufacturing sector share of GDP to 15% by 2022.
development  Develop domestic iron and steel industries by 2030.
targets
 Achieve middle-income status by 2030.
 In the AC, Kenya could supply an economy six-and half times larger than today using
little more than twice its current energy consumption, if it were to move away from
bioenergy and improve energy efficiency.
 Two-thirds of Kenya’s energy currently comes from bioenergy. This share shrinks to
15% by 2040 in the AC thanks to increased use of geothermal resources and oil.
Figure 6.7A ⊳ Kenya primary energy demand and GDP

75 1.5 Bioenergy
Mtoe
Other low-carbon
Solar PV
50 1.0 Hydro
Gas
Oil
Coal
25 0.5 GDP (right axis)
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.7B ⊳ Kenya electricity generation by technology

90
TWh
60
30
2010 2020 2030 2040 2010 2020 2030 2040
Coal Oil Back-up generators Gas Hydro Wind Solar PV Bioenergy Geothermal
 Kenya is one of the few countries to develop geothermal energy: by 2040, it accounts
for almost 50% of Kenya’s power generation in the STEPS.
 The sevenfold increase in electricity demand in the AC relies on expansion of
geothermal production (an increase to 4 GW) and new solar PV and gas capacity. 6
Figure 6.7C ⊳ Kenya electricity access solutions by type in the Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
Kenya has seen one of the fastest increases in electrification rates within sub-Saharan

Africa since 2013: by 2018, 75% of the population had access.
 Kenya aims to reach full access by 2022; the grid would be the principal least-cost
solution for the majority of the population (mainly in the south) still lacking access.

Figure 6.7D ⊳ Kenya final energy consumption

Mtoe
Productive uses
15 Transport
Residential
10
Demand changes
5
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Oil remains by far the dominant fuel in end-use sectors, and its use triples in road
transport in the AC, with five million additional vehicles being added to the fleet.
 Electricity demand reaches nearly 70 TWh in the AC, as light industry grows and as
ownership of household appliances and cooling systems increases; efficiency standards
avoid a further 8 TWh of demand.
Figure 6.7E ⊳ Kenya fuels and technologies used for cooking

2% 6% 9% 13%
9% 19%
17%
12%
23% 58%
25% 40%
66%
1%
 Today three-stone fires are still used for most cooking, fuelled mostly by charcoal in
urban areas and by wood in rural areas. In the STEPS, government initiatives lead to
26% of the population having access to clean cooking by 2030.

 In the AC, everybody gains access to clean cooking by 2030. Most of the 25 million
people otherwise without access in rural areas gain access primarily through improved
and advanced cookstoves; LPG is the least-cost fuel for most of the urban population.

Figure 6.7F ⊳ Kenya fossil fuel demand and production

12 0.3 6
8 0.2 4
4 0.1 2
2010 2040 2010 2040 2010 2040

 Kenya is not a notable oil and gas producer today, but it takes some steps to develop
its relatively modest resources.
 Higher economic growth underpins strong growth in fossil fuel demand in the AC. Oil
demand almost triples as it expands its share of the overall energy mix.
Figure 6.7G ⊳ Kenya cumulative investment needs, 2019-2040

6
20 40 60 80 100 120
Stated Policies
Africa Case
 Energy investment amounts to around $60 billion through to 2040 in the STEPS, with
renewables and electricity networks accounting for half of this.
 Investments in renewables and electricity networks need to double in the AC.
Kenya policy opportunities

 Kenya is on the cusp of reaching universal access to electricity. Concerted government
policy could help reach this aim through grid and stand-alone connections in roughly
equal measure.
 Kenya has made notable progress in deploying renewables in large part because it has
successfully attracted the necessary private investment for renewables projects.
Further development of these resources would help it meet demand growth.

6.8 Mozambique
Large hydro potential Important gas discoveries Second-largest coal producer
Table 6.8A ⊳ Mozambique key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 11 39 74 140 98 219 6.0% 8.1%

Performance  Promote the construction of electricity infrastructure that is resilient to climate change.
targets  Ensure sustainable and transparent management of the natural resources and the
environment.
Industrial  Five-Year Plan 2015–2019 focuses on empowering women and men for gender equity
development and equality, poverty reduction, economic development, and food security and
targets nutrition.
 Expand and modernise roads, bridges, water, ports and other key infrastructure.
 Mozambique could supply an economy more than five times larger than today in the
AC with four-times the energy demand if it were to diversify away from bioenergy and
improve energy efficiency.
 Bioenergy, including the traditional use of biomass, currently accounts for more than
60% of primary energy supply, but recent discoveries of gas enable the energy mix to
be diversified with gas accounting for 45% of the primary mix by 2040 in the AC.
Figure 6.8A ⊳ Mozambique primary energy demand and GDP

50 240 Bioenergy
Mtoe
Other low-carbon
40 Solar PV
180
Hydro
30 Gas
120 Oil
20 Coal
GDP (right axis)
60
10
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.8B ⊳ Mozambique electricity generation by technology

80
TWh
60
40
20
2010 2020 2030 2040 2010 2020 2030 2040
 Providing access to all and increasing electrification of productive uses almost

quadruples electricity demand in the AC.
 Hydropower remains an important source of electricity in each scenario, but its share
of generation declines from four-fifths today to more than 40% in the AC; gas grows in
importance as increasing use is made of domestic resources. 6
Figure 6.8C ⊳ Mozambique electricity access solutions by type in the
Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Currently 71% of the population lacks access to electricity; decentralised solutions are
the least-cost option for 55% of the new connections in the AC.
 In the AC, grid connections are the least-cost solution for the remaining 45% of new
connections: a large share of the population lives close to existing and planned grids.

Figure 6.8D ⊳ Mozambique final energy consumption

Mtoe
Productive uses
15 Transport
Residential
10
Demand changes
5 Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Oil remains the major fuel used in end-use sectors, with demand growing as a result of
increased use of LPG for cooking, while gas consumption exceeds electricity by 2040 in
both scenarios.
 In the AC, recent gas discoveries trigger a massive increase in overall industrial gas
demand: Mozambique increases production of aluminium more than fivefold by 2040,
becoming a significant exporter.
Figure 6.8E ⊳ Mozambique fuels and technologies used for cooking

2% 1%
6% 2%
2% 8%
23% 25%
34%
52%
69% 62% 14%
 In the STEPS, the proportion of the population relying on traditional uses of biomass
decreases from 92% to 87% by 2030.
 In the AC, natural gas is the least-cost option for a quarter of the 38 million people
without access in 2030; with improved cookstoves and LPG providing access for others.

Figure 6.8F ⊳ Mozambique fossil fuel demand and production

45 0.3 90
30 0.2 60
15 0.1 30
2010 2040 2010 2040 2010 2040

 The recent massive gas discoveries in Mozambique becoming the largest gas producer
in sub-Saharan Africa by 2040 in the AC.
 While the bulk of the production is destined for export, domestic demand also grows
as a result of efforts to foster gas-based industries and expand infrastructure in the AC.
Figure 6.8G ⊳ Mozambique cumulative investment needs, 2019-2040
Billion dollars (2018) 6

50 100 150 200
Stated Policies
Africa Case
 Energy investment needs amount to $115 billion through to 2040 in the STEPS, more
than 60% of which goes to gas production and infrastructure.
 The AC requires nearly 50% more capital to promote renewables in tandem with gas
infrastructure.
Mozambique policy opportunities

 Mozambique’s ambitions for economic and social development depend in large
measure on its ability to develop its large natural gas resources.
 In addition to providing valuable export revenue, its abundant gas resources could be
used to generate electricity, act as a catalyst for domestic industrial development, and
to support clean cooking.
 Large industrial consumers of gas could act as anchors for smaller industries looking to
increase their use of gas. The aluminium industry could be one such anchor consumer.
The success of a domestic aluminium export business will depend heavily on its ability
to secure affordable gas feedstock.

6.9 Nigeria
Largest population Largest economy Large chemicals producer
Table 6.9A ⊳ Nigeria key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 392 1 169 1 636 2 420 2 258 3 678 3.4% 5.3%

Performance  20% (unconditional) to 45% (conditional) reduction in GHG emissions by 2030
targets compared to the business-as-usual scenario.
 Increase oil production to 2.5 mb/d and become a net exporter by 2020, and end gas
flaring by 2030.
Industrial  Dedicate at least 30% of the federal budget to capital expenditure.
development  Achieve GDP growth of 7% and create over 15 million jobs by 2020 and double
targets manufacturing output to 20% of GDP by 2025.
 Nigeria remains Africa’s largest economy: in the AC, supplying an economy three-times
larger than today would require less energy demand if the energy mix were to be
diversified.
 In the AC, gas meets a growing share of energy demand, supported by the
implementation of the government’s gas masterplan.
Figure 6.9A ⊳ Nigeria primary energy demand and GDP

250 5
Mtoe
Bioenergy
200 4 Other low-carbon
Solar PV
150 3 Hydro
Gas
100 2 Oil
Coal
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.9B ⊳ Nigeria electricity generation by technology

250
TWh
200
150
100
50
2010 2020 2030 2040 2010 2020 2030 2040
 Today, 80% of power generation comes from gas; most of the remainder comes from
oil, with Nigeria the largest user of oil-fired back-up generators on the continent.
 Natural gas remains the main source of power in the AC, although there is a shift
towards solar PV as the country starts to exploit its large solar potential. 6
Figure 6.9C ⊳ Nigeria electricity access solutions by type in the Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
Provided that reliability and supply improve, the grid could become the optimal

solution to provide almost 60% of people with access to electricity in each scenario.
 In the AC, Nigeria achieves universal access by stepping up efforts to provide off-grid
solutions to those populations that live far from a grid.

Figure 6.9D ⊳ Nigeria final energy consumption

Mtoe
Productive uses
45 Transport
Residential
30
Demand changes
15 Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Nigeria is a major industrial producer and large chemical exporter. In the AC, it triples
chemicals production by 2040 with new gas-based methanol and ammonia plants.
 Nigeria has the second-largest vehicle stock in sub-Saharan Africa: the number of
vehicles could grow from 14 to 37 million in the AC by 2040 with only two-times more
oil consumption if more stringent fuel economy standards were introduced.
Figure 6.9E ⊳ Nigeria fuels and technologies used for cooking

4% 6% 5%
5% 15%
24%
18% 8%
5% 49%
51%
16% 27%
67%
 In the STEPS, there is progress on access to clean cooking services but almost three-
quarters of the population still lack access in 2030.
 In the AC, universal access is achieved through greater household access to gas
networks and LPG in the main cities, and to improved cookstoves in rural areas.

Figure 6.9F ⊳ Nigeria fossil fuel demand and production

15 3 90
10 2 60
5 1 30
2010 2040 2010 2040 2010 2040

 Delayed reforms and growing competition in international oil markets means that it
takes time for oil production to revive.
 In both scenarios, gas demand grows strongly in the industry and power sectors,
leading to action to increase production and reduce gas flaring.
Figure 6.9G ⊳ Nigeria cumulative investment needs, 2019-2040

6
100 200 300 400 500 600 700
Stated Policies
Africa Case
 Cumulative energy supply investment of $445 billion is needed in the STEPS, almost
80% of which goes to upstream oil and gas.
 The AC requires a significant ramp up in power sector investment. Spending on
electricity networks and renewables increases by 85% and 165% respectively,
compared to STEPS.
Nigeria policy opportunities
 Oil sector reforms would help to revive oil production while successful implementation
of the gas masterplan would foster gas-to-power, industrial development and
expansion of the gas network to industrial hubs.
 Improved power sector management and governance would help to reduce outages
and transmission losses. Failure to do so would impede industrial growth and would
mean continued high levels of use of polluting back-up generation.
 Reducing bioenergy use across all sectors would bring a number of benefits, not least
because its use is strongly linked to deforestation and air pollution.

6.10 Senegal
Emerging local gas market New oil and gas discoveries Ambitious renewables plan
Table 6.10A ⊳ Senegal key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 27 60 154 237 176 370 6.5% 8.7%

Performance  Start producing 100 000 barrels of oil per day from 2022.
targets  Achieve 200 GWh hydropower production in electricity generation output.
 Reach universal access to electricity by 2025, with 95% of rural connections provided
by the grid.
Industrial  The overall goal of Le Plan Sénégal Emergent 2023 is to achieve, through structural
development transformation of the economy, strong, inclusive and sustainable growth for the
targets well-being of the people and reach middle-income status by 2035.
 Senegal’s economy could grow six-times larger in the AC while limiting growth in
energy demand to three-times its current level by utilising new gas resources and
boosting the use of renewables in power.
 In the AC, gas meets a growing share of energy demand while traditional use of
biomass starts to decline in rural areas.
Figure 6.10A ⊳ Senegal primary energy demand and GDP

15 500 Bioenergy
Mtoe
Other low-carbon
12 400 Solar PV
Hydro
9 300 Gas
Oil
6 200 Coal
GDP (right axis)
3 100
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.10B ⊳ Senegal electricity generation by technology

20
TWh
15
10
2010 2020 2030 2040 2010 2020 2030 2040
 Electricity demand increases sharply in both scenarios, while the power mix changes,
with gas playing an increasingly important role and investments in wind and other
renewables bringing more diversification.
 Plans to phase out heavy fuel oil in the AC hinge on successful implementation of new
gas-to-power plans. 6
Figure 6.10C ⊳ Senegal electricity access solutions by type in the
Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Thanks to successful access policies, almost 70% of the population is connected today;
with adoption of a comprehensive integrated plan full access is achieved by 2025.

 The grid represents the least-cost option for the majority of the population currently
without electricity access today, with decentralised solutions reaching the most
remote populations.

Figure 6.10D ⊳ Senegal final energy consumption

8 Final consumption
Mtoe
Productive uses
6 Transport
Residential
4
Demand changes
2 Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Senegal’s stock of two/three-wheelers is set to grow strongly in both scenarios and its
electrification would help to free oil for other productive uses.
 In the AC, cement production could more than double to 2040, although the
availability of fuels, including domestic gas, will be critical for this and for wider future
industrial development.
Figure 6.10E ⊳ Senegal fuels and technologies used for cooking

7% 15%
19% 13% 14%
29%
39%
36%
52% 73%
3%
 LPG is used for cooking by almost 30% of the population today, one of the highest
shares in sub-Saharan Africa. It is expected to remain the main clean cooking fuel in
2030.
 In the AC, LPG is the least-cost option in both rural and urban areas for more than 70%
of the population currently still lacking access.

Figure 6.10F ⊳ Senegal fossil fuel demand and production

3 0.15 12
2 0.10 8
1 0.05 4
2010 2040 2010 2040 2010 2040

 Senegal is not a fossil fuel producer today, but the major gas discoveries are expected
to change the picture and to lead to gas production of 9.5 bcm in 2040 in the STEPS.
 The greater availability of gas helps displace oil use in power generation in domestic
markets while also bringing considerable export revenues.
Figure 6.10G ⊳ Senegal cumulative investment needs, 2019-2040

6
10 20 30 40 50
Stated Policies
Africa Case
 Energy investment needs amount to $33 billion through to 2040 in the STEPS, mainly
to unlock the potential for gas, expand power networks and increase electricity access.
 The AC sees this level of investment increase by a third, with more emphasis on gas
and renewable generation.
Senegal policy opportunities

 Implement a robust and transparent framework for resource management and design
of local content rules would help Senegal to make the most of its natural resources.
 The development of natural gas strategies that cover the entire value chain, including
end-uses (gas-to-power or gas-to-industry), would help Senegal to maximise the
benefits of its natural gas.
 Senegal’s power sector would be strengthened by continued diversified investment in

power, including renewables and natural gas, while phasing out heavy fuel oil.

6.11 South Africa
Africa’s only nuclear power Major commodity exporter Coal-fired power sector
Table 6.11A ⊳ South Africa key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 491 789 1 010 1 348 1 174 1 600 2.5% 3.3%
CO2 emissions (Mt CO2) 280 420 321 279 289 187 -1.8% -3.6%

Performance  The National Development Plan 2030 envisages that adequate investment in energy
targets infrastructure will promote economic growth and development.
 Decommission 35 GW (of 42 GW currently operating) of coal-fired power capacity
and supply at least 20 GW of the additional 29 GW of electricity needed by 2030
from renewables and natural gas.
Industrial  Secure primary steel production capability and support the downstream steel sector.
development  Automotive Masterplan 2020: raise domestic vehicle production to 1% of global
targets output including building 20% hybrid electric vehicles by 2030.
 The economy could double in the AC with less primary energy demand compared to
today by increasing the share of renewables and gas in the energy mix.
 In the AC, the role of coal in South African industry and power generation is already
decreasing, while that of gas and renewables is increasing.
Figure 6.11A ⊳ South Africa primary energy demand and GDP

150 2.0 Bioenergy
Mtoe
Other low-carbon
1.5 Solar PV
100 Hydro
Gas
1.0 Oil
Coal
50
GDP (right axis)
0.5
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.11B ⊳ South Africa electricity generation by technology

400
TWh
300
200
100
2010 2020 2030 2040 2010 2020 2030 2040

Coal Oil Back-up generators Gas Nuclear
Hydro Wind Solar PV Bioenergy Other renewables
 South Africa is reliant on coal but is making efforts to diversify as its coal-fired fleet is
ageing; new projects will not fully compensate for the decline of the existing fleet.
 The government is focussing on diversifying the power mix by introducing natural gas
and renewables, including concentrating solar power (CSP); South Africa has excellent 6
natural resources for CSP development.
Figure 6.11C ⊳ South Africa electricity access solutions by type in the

Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 South Africa has a well-developed electricity network and one of the highest rates of
electricity access in sub-Saharan Africa.
 The least-cost way to connect those without access is in most cases via the grid (81%)
with the residual population served by mini-grids (12%) and stand-alone systems.

Figure 6.11D ⊳ South Africa final energy consumption

Mtoe
Productive uses
40
Transport
30
Residential
20
Demand changes
10 Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Oil is the largest fuel in the end-use sectors; more stringent fuel economy standards
would mean that a 25% increase in demand could be met with a slight increase in the
amount of oil used.
 The role of coal in South African industry dwindles in the AC as gas and bioenergy are
increasingly used, especially in steel production and in light industries.
Figure 6.11E ⊳ South Africa fuels and technologies used for cooking

3% 2%
9% 7%
4% 3% 4% 7%
84% 91%
86%
 In both urban and rural areas, electricity is the favourite option for cooking in South
Africa, but more than 4 million living mainly in rural areas continue to use fuelwood for
heating and cooking in 2030 in the STEPS.
 Improved cookstoves and LPG would help close the gap between the STEPS and the AC
and eliminate the use of traditional biomass, reducing household premature deaths by
80% in 2030.

Figure 6.11F ⊳ South Africa fossil fuel demand and production

240 0.9 15
160 0.6 10
80 0.3 5
2010 2040 2010 2040 2010 2040

 South Africa continues to dominate coal production in Africa. Despite declining

production, falling domestic demand boosts export volumes in both scenarios.
 South Africa also relies on oil and gas for its energy needs, but recent gas discoveries
could reduce its import needs.
Figure 6.11G ⊳ South Africa cumulative investment needs, 2019-2040

6
50 100 150 200 250
Stated Policies
Africa Case

Power Fossil fuels Renewables Networks Other
 Nearly $220 billion of cumulative energy investment is needed in the STEPS, with
renewables and electricity networks accounting for the majority.
 The AC requires more investment in gas production, but overall efficiency
improvements moderate the additional spending needs.
South Africa policy opportunities

 Diversifying energy supply away from coal would have many benefits, including a
reduction in the number of premature deaths from pollution, but the social
implications of changes would need careful management.
 Reforming and restructuring ESKOM would strengthen the reliably of the power
system, support increased industrialisation and help efforts to diversify the energy mix.
 Strengthening efficiency throughout the economy would reduce demand for both
materials and energy, while the implementation of minimum energy performance
standards for electric motors in the industry and mining sectors would be an important
first step towards unlocking further efficiency gains.

6.12 Tanzania
Strong economic growth Major gas discovery Plans for urban transport
Table 6.12A ⊳ Tanzania key indicators and policy initiatives

2000 2018 2030 2040 2030 2040 STEPS AC
GDP ($2018 billion, PPP) 57 176 314 585 475 1 233 5.6% 9.3%

Performance  Reduce GHG emissions by 10-20% by 2030 compared to the business-as-usual
targets scenario (138-153 Mt CO2-equivalent gross emissions).
 Increase electricity generation capacity from 1 500 MW in 2015 to 4 910 MW and
achieve 50% energy from renewable energy sources by 2020.
Industrial  Raise annual real GDP growth to 10% by 2021.
development  Build a semi-industrialised country by 2025 in which the contribution of
targets manufacturing to the national economy reaches at least 40% of GDP.
 With annual GDP growth of more than 9% in the AC, Tanzania’s economy could be
seven-times larger in 2040 than today, but with an increase in energy demand limited
to 150% driven by fuel efficiency gains.
 In the AC, diversifying the energy mix and improving energy efficiency are the keys to
achieving economic growth while limiting growth in energy demand, with oil, gas and
geothermal reducing the share of bioenergy in the energy mix.
Figure 6.12A ⊳ Tanzania primary energy demand and GDP

60 1.5 Bioenergy
Mtoe
Other low-carbon
Solar PV
40 1.0 Hydro
Gas
Oil
Coal
20 0.5
GDP (right axis)
2010 2018 2030 2040 2010 2018 2030 2040

Figure 6.12B ⊳ Tanzania electricity generation by technology

120
TWh
90
60
30
2010 2020 2030 2040 2010 2020 2030 2040
 Gas accounts for more than half of current power generation, with the remainder
coming from hydropower and oil, the latter used mostly for back-up generators.
 Providing access for all and a growth in productive uses lead to a thirteen-fold increase
of electricity demand by 2040 in the AC: this is met with an expansion of gas,
hydropower and solar PV. 6
Figure 6.12C ⊳ Tanzania electricity access solutions by type in the
Africa Case

On-grid
Mini-grids
Stand-alone systems

Existing
Planned
 Despite the low access rate (37%) today, the grid represents more than half of new
connections by 2030 in the AC given its existing and planned coverage.
 In the AC, around one-third of the remaining population, mainly located in sparsely
populated areas far from the grid, would be best reached by stand-alone systems.

Figure 6.12D ⊳ Tanzania total final consumption

Mtoe
Productive uses
15 Transport
Residential
10
Demand changes
5
Higher GDP
and access
Efficiency gains
2018 2040 2040 2018 2040 2040
STEPS AC STEPS AC
 Oil continues to play an important role in end-use sectors, not least as a result of its
use by the increasing number of buses on the road as Tanzania has a large bus fleet.
 Gas and electricity use in industry is growing strongly, especially in manufacturing
industries, but in the AC, energy efficiency measures have prevented consumption
from being 20% higher than current levels.
Figure 6.12E ⊳ Tanzania use of fuels and technologies for cooking

1%
1% 27% 7%
20% 15%
5%
17%
48%
22% 37%
33%
66%
1%
 Despite policies to promote clean cooking solutions, the number of people relying on
traditional use of biomass for cooking declines from 55 million people today to
44 million in 2030 as efforts to improve access outrun by high population growth in
STEPS.
 In the AC, LPG and biogas are the least-cost options for almost half of the population,
with improved cookstoves the main way to extend access in rural areas.

Figure 6.12F ⊳ Tanzania fossil fuel demand and production

6 0.3 45
4 0.2 30
2 0.1 15
2010 2040 2010 2040 2010 2040

 Recent large discoveries push up gas production to almost 30 bcm by 2040 in the
STEPS. Existing infrastructure helps Tanzania to increase domestic gas consumption.
 Gas demand in 2040 is twice as high in the AC, helped by efforts to promote the use of
gas to displace traditional biomass and by support for gas-based industries.
Figure 6.12G ⊳ Tanzania cumulative investment needs, 2019-2040

6
60 120 180
Stated Policies
Africa Case
 Almost $80 billion of cumulative energy supply investment is needed in the STEPS,
with most of it being used to widen access to gas and electricity.
 This level of investment doubles in the AC, with higher amounts of capital allocated to
electricity access and networks.
Tanzania policy opportunities

 A rapid development of offshore resources would help to ensure greater availability of
gas, and a robust framework to use export revenues in an effective manner would help
to ensure that the country makes the most of those revenues.
 Maintaining investment in public transport, notably in Dar es Salaam, but also in other
cities and between cities and rural areas, would help to facilitate economic growth.
Government should also ensure public transport is affordable for all.

Annex A
Tables for scenario projections

This annex includes historical and projected data for the Stated Policies Scenario and Africa
Case for energy demand, gross electricity generation, electrical capacity, and CO2 emissions
from fossil fuel combustion.
Both in the text of this book and in the tables, rounding may lead to minor differences
between totals and the sum of their individual components. Growth rates are calculated on
a compound average annual basis and are marked “n.a.” when the base year is zero or the
value exceeds 200%. Nil values are marked “-”.
Data sources
Much of the data on energy supply, transformation and demand, as well as CO2 emissions
from fuel combustion, are obtained from the IEA’s own databases of energy and economic
statistics (www.iea.org/statistics/). Additional data from a wide range of external sources
are also used. Historical data for gross power generation capacity are drawn from the S&P
Global Market Intelligence World Electric Power Plants Database (March 2019 version) and
the International Atomic Energy Agency PRIS database (www.iaea.org/pris).
The formal base year for this year’s projections is 2017, as this is the last year for which a
complete picture of energy demand and production is in place. However, we have used
more recent data wherever available, and we include our 2018 estimates for energy
production and demand in this annex. Estimates for the year 2018 are based on an update
of the Global Energy and CO2 Status Report which is derived from a number of sources,
including the latest monthly data submissions to the IEA’s Energy Data Centre, other
statistical releases from national administrations, and recent market data from the IEA
Market Report Series that cover coal, oil, natural gas, renewables and power.
Definitional notes
Total primary energy demand (TPED) is equivalent to power generation plus “other energy
sector” excluding electricity and heat, plus total final consumption (TFC) excluding
electricity and heat. TPED does not include ambient heat from heat pumps or electricity
trade. Sectors comprising TFC include industry, transport, buildings (residential, services
and non-specified other) and other (agriculture and non-energy use).
Projected gross electrical capacity is the sum of existing capacity and additions, less
retirements. While not itemised separately, other sources are included in total electricity
generation, and battery storage in total power generation capacity.
Total CO2 includes carbon dioxide emissions from “other energy sector” in addition to the
power and final consumption sectors shown in the tables. CO2 emissions do not include
emissions from industrial waste and non-renewable municipal waste. For more information
please visit www.iea.org/statistics/CO2emissions.

Abbreviations used: Mtoe = million tonnes of oil equivalent; CAAGR = compound average
annual growth rate; Petrochem. feedstock = petrochemical feedstock.
Annex A | Tables for scenario projections 257

Energy demand – Africa
Energy demand (Mtoe) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total primary demand 681 817 838 992 1 100 1 202 1 318 100 100 2.1
Coal 108 110 112 116 112 112 113 13 9 0.0
Oil 161 193 194 237 266 298 333 23 25 2.5
Natural gas 90 126 133 154 184 220 263 16 20 3.2
Nuclear 3 4 4 4 7 9 11 0 1 5.2
Hydro 9 11 12 17 21 24 30 1 2 4.4
Bioenergy 308 368 378 449 471 470 471 45 36 1.0
Other renewables 2 6 7 16 39 68 97 1 7 13.0
Power sector 142 168 175 194 230 275 327 100 100 2.9
Coal 66 65 66 69 64 60 54 38 17 -0.9
Oil 17 18 19 20 19 20 19 11 6 -0.1
Natural gas 44 64 67 67 75 88 109 38 33 2.2
Nuclear 3 4 4 4 7 9 11 2 3 5.2
Hydro 9 11 12 17 21 24 30 7 9 4.4
Bioenergy 1 1 1 2 6 9 11 1 3 11.7
Other energy sector 101 126 127 164 179 183 190 100 100 1.9
Electricity 12 16 16 17 20 24 29 13 15 2.7
Total final consumption 496 594 611 727 804 881 970 100 100 2.1
Coal 17 21 22 22 23 24 26 4 3 0.7
Oil 137 165 167 207 238 271 308 27 32 2.8
Natural gas 29 42 46 61 77 96 114 8 12 4.2
Electricity 47 57 59 75 92 114 141 10 15 4.0
Heat - - - - - - - - - n.a.
Bioenergy 266 309 317 359 372 374 377 52 39 0.8
Industry 83 95 98 119 135 157 184 100 100 2.9
Coal 12 11 12 14 16 17 20 12 11 2.3
Oil 17 18 17 21 23 26 31 18 17 2.7
Natural gas 14 24 27 34 40 48 57 27 31 3.5
Electricity 20 23 24 28 33 38 44 24 24 2.8
Heat - - - - - - - - - n.a.
Bioenergy 20 18 18 22 24 27 32 19 17 2.5
Other renewables - - - 0 0 0 0 - 0 n.a.
Transport 86 116 118 147 168 187 207 100 100 2.6
Oil 85 114 116 144 163 181 199 98 96 2.5
Electricity 0 1 1 1 1 2 2 0 1 6.8
Biofuels 0 0 0 1 1 1 2 0 1 20.8
Other fuels 1 1 1 2 2 3 3 1 2 3.9
Buildings 297 358 369 426 460 490 525 100 100 1.6
Coal 3 8 8 6 5 4 4 2 1 -3.7
Oil 19 19 19 23 28 37 47 5 9 4.2
Natural gas 6 12 14 20 28 37 44 4 8 5.4
Electricity 24 31 33 43 55 70 90 9 17 4.7
Heat - - - - - - - - - n.a.
Bioenergy 244 288 295 333 342 340 337 80 64 0.6
Traditional biomass 236 277 283 320 326 321 314 77 60 0.5
Other 30 25 26 35 41 47 54 100 100 3.4
Petrochem. feedstock 12 6 6 11 13 15 17 25 32 4.6

Energy demand – Africa
Africa Case
Energy demand (Mtoe) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total primary demand 681 817 838 872 888 1 024 1 204 100 100 1.7
Coal 108 110 112 110 105 104 100 13 8 -0.5
Oil 161 193 194 257 304 335 362 23 30 2.9
Natural gas 90 126 133 171 198 229 290 16 24 3.6
Nuclear 3 4 4 4 7 9 19 0 2 7.6
Hydro 9 11 12 19 27 36 44 1 4 6.3
Bioenergy 308 368 378 280 180 197 212 45 18 -2.6
Power sector 142 168 175 229 285 348 451 100 100 4.4
Coal 66 65 66 65 58 52 41 38 9 -2.1
Oil 17 18 19 22 27 27 26 11 6 1.3
Natural gas 44 64 67 86 94 104 137 38 30 3.3
Nuclear 3 4 4 4 7 9 19 2 4 7.6
Hydro 9 11 12 19 27 36 44 7 10 6.3
Bioenergy 1 1 1 4 8 11 15 1 3 13.2
Other energy sector 101 126 127 122 114 123 137 100 100 0.4
Electricity 12 16 16 21 27 33 42 13 31 4.5
Total final consumption 496 594 611 633 637 739 859 100 100 1.6
Coal 17 21 22 21 21 22 24 4 3 0.3
Oil 137 165 167 226 269 302 333 27 39 3.2
Natural gas 29 42 46 61 77 97 123 8 14 4.6
Electricity 47 57 59 90 120 153 200 10 23 5.7
Heat - - - - - - - - - n.a.
Bioenergy 266 309 317 232 145 158 169 52 20 -2.8
Industry 83 95 98 120 140 168 205 100 100 3.4
Coal 12 11 12 13 14 16 19 12 9 2.1
Oil 17 18 17 21 25 29 35 18 17 3.2
Natural gas 14 24 27 34 40 49 62 27 30 3.9
Electricity 20 23 24 27 31 40 52 24 25 3.6
Heat - - - - - - - - - n.a.
Bioenergy 20 18 18 25 30 33 36 19 18 3.2
Other renewables - - - 0 0 1 1 - 1 n.a.
Transport 86 116 118 159 186 206 222 100 100 2.9
Oil 85 114 116 154 176 189 198 98 89 2.4
Electricity 0 1 1 1 1 2 3 0 2 9.0
Biofuels 0 0 0 1 2 3 4 0 2 24.3
Other fuels 1 1 1 3 6 12 18 1 8 12.0
Buildings 297 358 369 317 266 311 365 100 100 -0.1
Coal 3 8 8 6 5 4 3 2 1 -5.0
Oil 19 19 19 29 42 52 61 5 17 5.4
Natural gas 6 12 14 19 22 25 29 4 8 3.4
Electricity 24 31 33 58 83 106 138 9 38 6.7
Heat - - - - - - - - - n.a.
Bioenergy 244 288 295 203 110 119 127 80 35 -3.8
Traditional biomass 236 277 283 186 88 95 101 77 28 -4.6

Other 30 25 26 37 45 54 66 100 100 4.4 A
Petrochem. feedstock 12 6 6 11 14 17 23 25 35 6.0

Electricity and CO2 emissions – Africa
Electricity generation (TWh) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total generation 671 827 866 1 056 1 284 1 564 1 897 100 100 3.6
Coal 259 254 258 284 268 256 240 30 13 -0.3
Oil 64 75 79 84 79 82 78 9 4 -0.0
Natural gas 220 335 351 377 433 523 651 40 34 2.9
Nuclear 12 14 14 14 28 35 44 2 2 5.2
Renewables 115 147 163 296 474 668 882 19 46 8.0
Hydro 110 123 135 202 245 283 348 16 18 4.4
Bioenergy 1 2 2 7 22 32 40 0 2 14.9
Wind 2 12 14 39 84 120 159 2 8 11.7
Geothermal 1 5 5 9 23 41 59 1 3 12.1
Solar PV 0 5 6 34 90 172 241 1 13 18.1
CSP - 1 2 5 9 19 34 0 2 13.9
Marine - - - - - - - - - n.a.

Electrical capacity (GW) Shares (%) CAAGR (%)
2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total capacity 228 244 315 400 501 614 100 100 4.3
Coal 48 48 55 55 51 48 20 8 0.0
Oil 42 43 35 36 37 36 18 6 -0.8
Natural gas 92 103 129 146 171 207 42 34 3.2
Nuclear 2 2 2 4 5 6 1 1 5.0
Renewables 44 48 90 154 225 299 20 49 8.7
Hydro 35 36 49 57 67 83 15 13 3.9
Bioenergy 1 1 2 6 8 9 0 1 11.9
Wind 5 5 15 30 41 53 2 9 10.9
Geothermal 1 1 1 4 6 9 0 1 12.6
Solar PV 3 4 21 55 98 135 2 22 16.8
CSP 1 1 2 3 6 10 0 2 11.3
Marine - - - - - - - - n.a.

CO2 emissions (Mt) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total CO2 1 017 1 181 1 215 1 357 1 464 1 621 1 797 100 100 1.8
Coal 385 391 395 382 346 332 318 32 18 -1.0
Oil 450 541 551 668 750 846 948 45 53 2.5
Natural gas 182 248 269 307 368 443 532 22 30 3.1
Power sector 420 466 480 495 490 508 530 100 100 0.4
Coal 263 257 261 275 255 239 215 54 41 -0.9
Oil 54 59 62 63 59 62 60 13 11 -0.2
Natural gas 103 150 158 157 176 208 256 33 48 2.2
Final consumption 496 620 641 776 892 1 021 1 163 100 100 2.7
Coal 66 83 85 84 85 89 96 13 8 0.5
Oil 382 472 480 590 675 767 871 75 75 2.8
Transport 257 345 351 436 495 549 603 55 52 2.5
Natural gas 48 65 76 102 131 165 197 12 17 4.4

Electricity and CO2 emissions – Africa
Africa Case
Electricity generation (TWh) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total generation 671 827 866 1 268 1 662 2 107 2 740 100 100 5.4
Coal 259 254 258 255 228 210 171 30 6 -1.8
Oil 64 75 79 91 108 107 102 9 4 1.2
Natural gas 220 335 351 506 567 646 850 40 31 4.1
Nuclear 12 14 14 14 28 34 71 2 3 7.6
Renewables 115 147 163 400 729 1 109 1 544 19 56 10.7
Hydro 110 123 135 218 312 420 512 16 19 6.3
Bioenergy 1 2 2 13 27 40 54 0 2 16.4
Wind 2 12 14 64 136 198 264 2 10 14.3
Geothermal 1 5 5 17 34 59 95 1 3 14.5
Solar PV 0 5 6 79 196 341 533 1 19 22.4
CSP - 1 2 10 24 51 87 0 3 18.8
Marine - - - 0 0 0 0 - 0 n.a.
Africa Case
Electrical capacity (GW) Shares (%) CAAGR (%)
2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total capacity 228 244 398 550 709 924 100 100 6.2
Coal 48 48 53 50 45 37 20 4 -1.2
Oil 42 43 48 51 52 53 18 6 1.0
Natural gas 92 103 148 167 183 228 42 25 3.7
Nuclear 2 2 2 4 5 10 1 1 7.6
Renewables 44 48 144 273 414 579 20 63 12.0
Hydro 35 36 57 77 99 117 15 13 5.5
Bioenergy 1 1 4 7 9 11 0 1 13.0
Wind 5 5 25 51 72 94 2 10 13.8
Geothermal 1 1 2 5 9 14 0 2 14.9
Solar PV 3 4 52 124 209 316 2 34 21.5
CSP 1 1 4 9 17 26 0 3 16.2
Marine - - 0 0 0 0 - 0 n.a.
Africa Case
CO2 emissions (Mt) Shares (%) CAAGR (%)
2010 2017 2018 2025 2030 2035 2040 2018 2040 2018-40
Total CO2 1 017 1 181 1 215 1 450 1 590 1 719 1 886 100 100 2.0
Coal 385 391 395 358 314 295 264 32 14 -1.8
Oil 450 541 551 738 872 959 1 032 45 55 2.9
Natural gas 182 248 269 353 405 465 590 22 31 3.6
Power sector 420 466 480 529 536 538 567 100 100 0.8
Coal 263 257 261 257 230 208 163 54 29 -2.1
Oil 54 59 62 69 85 85 82 13 14 1.3
Natural gas 103 150 158 203 221 245 322 33 57 3.3
Final consumption 496 620 641 839 986 1 113 1 244 100 100 3.1
Coal 66 83 85 79 77 78 85 13 7 -0.0
Oil 382 472 480 646 763 850 927 75 75 3.0
Transport 257 345 351 466 533 573 599 55 48 2.5 A
Natural gas 48 65 76 115 146 184 232 12 19 5.2

Annex B
Definitions
This annex provides general information on terminology used throughout the report
including: units and general conversion factors; definitions of fuels, processes and sectors;
regional and country groupings; and abbreviations and acronyms.
Units
Area Ha hectare
2
km square kilometre
Coal Mtce million tonnes of coal equivalent (equals 0.7 Mtoe)

Mtpa million tonnes per annum
Emissions ppm parts per million (by volume)

Gt CO2-eq gigatonnes of carbon-dioxide equivalent (using
100-year global warming potentials for different
greenhouse gases)
kg CO2-eq kilogrammes of carbon-dioxide equivalent
g CO2/km grammes of carbon dioxide per kilometre
g CO2/kWh grammes of carbon dioxide per kilowatt-hour
Energy boe barrel of oil equivalent

toe tonne of oil equivalent
ktoe thousand tonnes of oil equivalent
Mtoe million tonnes of oil equivalent
MBtu million British thermal units
3
kcal kilocalorie (1 calorie x 10 )
9
Gcal gigacalorie (1 calorie x 10 )
6
MJ megajoule (1 joule x 10 )
9
GJ gigajoule (1 joule x 10 )
12
TJ terajoule (1 joule x 10 )
15
PJ petajoule (1 joule x 10 )
18
EJ exajoule (1 joule x 10 )
kWh kilowatt-hour
MWh megawatt-hour
GWh gigawatt-hour
TWh terawatt-hour
Gas mcm million cubic metres

bcm billion cubic metres
tcm trillion cubic metres

scf standard cubic foot
Mass kg kilogramme (1 000 kg = 1 tonne)
Annex B | Definitions 263

3
kt kilotonnes (1 tonne x 10 )
6
Mt million tonnes (1 tonne x 10 )
9
Gt gigatonnes (1 tonne x 10 )
6
Monetary $ million 1 US dollar x 10
9
$ billion 1 US dollar x 10
12
$ trillion 1 US dollar x 10
Oil b/d barrels per day
kb/d thousand barrels per day
mb/d million barrels per day
mboe/d million barrels of oil equivalent per day
Power W watt (1 joule per second)
3
kW kilowatt (1 watt x 10 )
6
MW megawatt (1 watt x 10 )
9
GW gigawatt (1 watt x 10 )
12
TW terawatt (1 watt x 10 )
Water bcm billion cubic metres
3
m cubic metre
General conversion factors for energy

Convert to: TJ Gcal Mtoe MBtu GWh
From: multiply by:
-5
TJ 1 238.8 2.388 x 10 947.8 0.2778
-3 -7 -3
Gcal 4.1868 x 10 1 10 3.968 1.163 x 10
4 7 7
Mtoe 4.1868 x 10 10 1 3.968 x 10 11 630
-3 -8
MBtu 1.0551 x 10 0.252 2.52 x 10 1 2.931 x 10-4
-5
GWh 3.6 860 8.6 x 10 3 412 1
Note: There is no generally accepted definition of boe; typically the conversion factors used vary from
7.15 to 7.40 boe per toe.

Definitions
Advanced biofuels: Sustainable fuels produced from non-food crop feedstocks, which are
capable of delivering significant lifecycle greenhouse gas emissions savings compared with
fossil fuel alternatives, and which do not directly compete with food and feed crops for
agricultural land or cause adverse sustainability impacts. This definition differs from the
one used for “advanced biofuels” in the US legislation, which is based on a minimum 50%
lifecycle greenhouse gas reduction and which, therefore, includes sugar cane ethanol.
Agriculture: Includes all energy used on farms, in forestry and for fishing.
Back-up generation capacity: Households and businesses connected to the main power
grid may also have some form of “back-up” power generation capacity that can, in the
event of disruption, provide electricity. Back-up generators are typically fuelled with diesel
or gasoline and capacity can be as little as a few kilowatts. Such capacity is distinct from
mini-grid and off-grid systems that are not connected to the main power grid.
Biodiesel: Diesel-equivalent, processed fuel made from the transesterification (a chemical
process that converts triglycerides in oils) of vegetable oils and animal fats.
Bioenergy: Energy content in solid, liquid and gaseous products derived from biomass
feedstocks and biogas. It includes solid biomass, biofuels and biogas.
Biofuels: Liquid fuels derived from biomass or waste feedstocks and include ethanol and
biodiesel. They can be classified as conventional and advanced biofuels according to the
technologies used to produce them and their respective maturity. Unless otherwise stated,
biofuels are expressed in energy-equivalent volumes of gasoline and diesel.
Biogas: A mixture of methane, CO₂ and small quantities of other gases produced by
anaerobic digestion of organic matter in an oxygen-free environment.
Buildings: The buildings sector includes energy used in residential, commercial and
institutional buildings, and non-specified other. Building energy use includes space heating
and cooling, water heating, lighting, appliances and cooking equipment.
Bunkers: Includes both international marine bunkers and international aviation bunkers.
Clean cooking facilities: Cooking facilities that are considered safer, more efficient and
more environmentally sustainable than the traditional facilities that make use of solid
biomass (such as a three-stone fire). This refers primarily to improved solid biomass
cookstoves, biogas systems, liquefied petroleum gas stoves, ethanol and solar stoves.
Coal: Includes both primary coal (including lignite, coking and steam coal) and derived fuels
(including patent fuel, brown-coal briquettes, coke-oven coke, gas coke, gas-works gas,
coke-oven gas, blast-furnace gas and oxygen steel furnace gas). Peat is also included.
Coking coal: Type of coal that can be used for steel making (as a chemical reductant and
source heat), where it produces coke capable of supporting a blast furnace charge. Coal of
this quality is also commonly known as metallurgical coal.
B

Conventional biofuels: Fuels produced from food crop feedstocks. These biofuels are
commonly referred to as first-generation and include sugar cane ethanol, starch-based
ethanol, fatty acid methyl esther (FAME) and straight vegetable oil (SVO).
Dispatchable: Dispatchable generation refers to technologies whose power output can be
readily controlled - increased to maximum rated capacity or decreased to zero - in order to
match supply with demand.
Electricity demand: Defined as total gross electricity generation less own use generation,
plus net trade (imports less exports), less transmissions and distribution losses.
Electricity generation: Defined as the total amount of electricity generated by power only
or combined heat and power plants including generation required for own-use. This is also
referred to as gross generation.
Energy sector CO2 emissions: CO2 emissions from fuel combustion (excluding non-
renewable waste). Note that this does not include fugitive emissions from fuels, CO2
transport, storage emissions or industrial process emissions.
Energy sector GHG emissions: CO2 emissions from fuel combustion plus fugitive and vented
methane and N2O emissions from the energy and industry sectors.
Energy services: see useful energy.
Ethanol: Refers to bio-ethanol only. Ethanol is produced from fermenting any biomass high
in carbohydrates. Today, ethanol is made from starches and sugars, but second-generation
technologies will allow it to be made from cellulose and hemicellulose, the fibrous material
that makes up the bulk of most plant matter.
Hydropower: The energy content of the electricity produced in hydropower plants,
assuming 100% efficiency. It excludes output from pumped storage and marine (tide and
wave) plants.
Industry: The sector includes fuel used within the manufacturing and construction
industries. Key industry branches include iron and steel, chemical and petrochemical,
cement, and pulp and paper. Use by industries for the transformation of energy into
another form or for the production of fuels is excluded and reported separately under
other energy sector. Consumption of fuels for the transport of goods is reported as part of
the transport sector, while consumption by off-road vehicles is reported under industry.
International aviation bunkers: Includes the deliveries of aviation fuels to aircraft for
international aviation. Fuels used by airlines for their road vehicles are excluded. The
domestic/international split is determined on the basis of departure and landing locations
and not by the nationality of the airline. For many countries this incorrectly excludes fuels
used by domestically owned carriers for their international departures.
International marine bunkers: Covers those quantities delivered to ships of all flags that
are engaged in international navigation. The international navigation may take place at sea,
on inland lakes and waterways, and in coastal waters. Consumption by ships engaged in
domestic navigation is excluded. The domestic/international split is determined on the

basis of port of departure and port of arrival, and not by the flag or nationality of the ship.
Consumption by fishing vessels and by military forces is also excluded and included in
residential, services and agriculture.
Investment: All investment data and projections reflect spending across the lifecycle of a
project, i.e. the capital spent is assigned to the year when it is incurred. Investments for oil,
gas and coal include production, transformation and transportation; those for the power
sector include refurbishments, uprates, new builds and replacements for all fuels and
technologies for on-grid, mini-grid and off-grid generation, as well as investment in
transmission and distribution, and battery storage. Investment data are presented in real
terms in year-2018 US dollars unless otherwise stated.
Liquids: Refers to the combined use of oil and biofuels (expressed in energy-equivalent
volumes of gasoline and diesel).
Mini-grids: Small grid systems linking a number of households or other consumers.
Modern energy access: Includes household access to a minimum level of electricity;
household access to safer and more sustainable cooking and heating fuels and stoves;
access that enables productive economic activity; and access for public services.
Modern renewables: Includes all uses of renewable energy with the exception of
traditional use of solid biomass.
Modern use of solid biomass: Refers to the use of solid biomass in improved cookstoves
and modern technologies using processed biomass such as pellets.
Natural gas: Comprises gases occurring in deposits, whether liquefied or gaseous,
consisting mainly of methane. It includes both “non-associated” gas originating from fields
producing hydrocarbons only in gaseous form, and “associated” gas produced in
association with crude oil as well as methane recovered from coal mines (colliery gas).
Natural gas liquids (NGLs), manufactured gas (produced from municipal or industrial waste,
or sewage) and quantities vented or flared are not included. Gas data in cubic metres are
expressed on a “gross” calorific value basis and are measured at 15 °C and at 760 mm Hg
(“Standard Conditions”). Gas data expressed in tonnes of oil equivalent, mainly for
comparison reasons with other fuels, are on a “net” calorific basis. The difference between
the net and the gross calorific value is the latent heat of vaporisation of the water vapour
produced during combustion of the fuel (for gas the net calorific value is 10% lower than
the gross calorific value).
Natural gas liquids (NGLs): Liquid or liquefied hydrocarbons produced in the manufacture,
purification and stabilisation of natural gas. These are those portions of natural gas which
are recovered as liquids in separators, field facilities or gas processing plants. NGLs include
but are not limited to ethane (when it is removed from the natural gas stream), propane,
butane, pentane, natural gasoline and condensates.
Non-energy use: Fuels used for chemical feedstocks and non-energy products. Examples of
non-energy products include lubricants, paraffin waxes, asphalt, bitumen, coal tars and oils B
as timber preservatives.

Nuclear: Refers to the primary energy equivalent of the electricity produced by a nuclear
plant, assuming an average conversion efficiency of 33%.
Off-grid systems: Stand-alone systems for individual households or groups of consumers.
Oil: Oil production includes both conventional and unconventional oil. Petroleum products
include refinery gas, ethane, liquid petroleum gas, aviation gasoline, motor gasoline, jet
fuels, kerosene, gas/diesel oil, heavy fuel oil, naphtha, white spirit, lubricants, bitumen,
paraffin, waxes and petroleum coke.
Other energy sector: Covers the use of energy by transformation industries and the energy
losses in converting primary energy into a form that can be used in the final consuming
sectors. It includes losses by gas works, petroleum refineries, blast furnaces, coke ovens,
coal and gas transformation and liquefaction. It also includes energy used in coal mines, in
oil and gas extraction and in electricity and heat production. Transfers and statistical
differences are also included in this category.
Peri-urban: Peri-urban areas are zones of transition from rural to urban which often form
the urban-rural interface and may evolve into being fully urban.
Power generation: Refers to fuel use in electricity plants, heat plants and combined heat
and power (CHP) plants. Both main activity producer plants and small plants that produce
fuel for their own use (auto-producers) are included.
Productive uses: Energy used towards an economic purpose: agriculture, industry, services,
and non-energy use. Some energy demand from the transport sector (e.g. freight) could
also be considered as productive, but is treated separately.
Refining processing gains: Processing gains are volume increases that occur during crude
oil refining.
Renewables: Includes bioenergy, geothermal, hydropower, solar photovoltaic (PV),
concentrating solar power (CSP), wind and marine (tide and wave) energy for electricity
and heat generation.
Residential: Energy used by households including space heating and cooling, water heating,
lighting, appliances, electronic devices and cooking equipment.
Services: Energy used in commercial (e.g. hotels, offices, catering, shops) and institutional
buildings (e.g. schools, hospitals, offices). Services energy use includes space heating and
cooling, water heating, lighting, equipment, appliances and cooking equipment.
Shale gas: Natural gas contained within a commonly occurring rock classified as shale.
Shale formations are characterised by low permeability, with more limited ability of gas to
flow through the rock than is the case with a conventional reservoir. Shale gas is generally
produced using hydraulic fracturing.
Solid biomass: Includes charcoal, fuelwood, dung, agricultural residues, wood waste and
other solid wastes.

Tight oil: Oil produced from shales or other very low permeability formations, using
hydraulic fracturing. This is also sometimes referred to as light tight oil. Tight oil includes
tight crude oil and condensate production except for the United States, which includes
tight crude oil only (US tight condensate volumes are included in natural gas liquids).
Total final consumption (TFC): Is the sum of consumption by the various end-use sectors.
TFC is broken down into energy demand in the following sectors: industry (including
manufacturing and mining), transport, buildings (including residential and services) and
other (including agriculture and non-energy use). It excludes international marine and
aviation bunkers, except at world level where it is included in the transport sector.
Total primary energy demand (TPED): Represents domestic demand only and is broken
down into power generation, other energy sector and total final consumption.
Traditional use of solid biomass: Refers to the use of solid biomass with basic technologies,
such as a three-stone fire, often with no or poorly operating chimneys.
Transport: Fuels and electricity used in the transport of goods or persons within the
national territory irrespective of the economic sector within which the activity occurs. This
includes fuel and electricity delivered to vehicles using public roads or for use in rail
vehicles; fuel delivered to vessels for domestic navigation; fuel delivered to aircraft for
domestic aviation; and energy consumed in the delivery of fuels through pipelines. Fuel
delivered to international marine and aviation bunkers is presented only at the world level
and is excluded from the transport sector at a domestic level.
Useful energy: Refers to the energy that is available to end-users to satisfy their needs. This
is also referred to as energy services demand. As result of transformation losses at the
point of use, the amount of useful energy is lower than the corresponding final energy
demand for most technologies. Equipment using electricity often has higher conversion
efficiency than equipment using other fuels, meaning that for a unit of energy consumed
electricity can provide more energy services.
Variable renewable energy (VRE): Refers to technologies whose maximum output at any
time depends on the availability of fluctuating renewable energy resources. VRE includes a
broad array of technologies such as wind power, solar PV, run-of-river hydro, concentrating
solar power (where no thermal storage is included) and marine (tidal and wave).
Water consumption: The volume withdrawn that is not returned to the source (i.e. it is
evaporated or transported to another location) and by definition is no longer available for
other uses.
Water sector: Includes all processes whose main purpose is to treat/process or move water
to or from the end-use: groundwater and surface water extraction, long-distance water
transport, water treatment, desalination, water distribution, wastewater collection,
wastewater treatment and water re-use.
Water withdrawal: The volume of water removed from a source; by definition withdrawals
are always greater than or equal to consumption. B

Regional and country groupings
Figure B.1 ⊳ World Energy Outlook main country groupings
Note: This map is without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and
boundaries and to the name of any territory, city or area.
Africa: North Africa and sub-Saharan Africa regional groupings.

North Africa: Algeria, Egypt, Libya, Morocco and Tunisia.
Sub-Saharan Africa: Angola, Benin, Botswana, Cameroon, Republic of the Congo (Congo),
Côte d’Ivoire, Democratic Republic of the Congo, Eritrea, Ethiopia, Gabon, Ghana, Kenya,
Mauritius, Mozambique, Namibia, Niger, Nigeria, Senegal, South Africa, South Sudan,
Sudan, United Republic of Tanzania (Tanzania), Togo, Zambia, Zimbabwe and other African
countries and territories.1
Advanced economies: OECD regional grouping and Bulgaria, Croatia, Cyprus2,3, Malta and
Romania.
Asia Pacific: Southeast Asia regional grouping and Australia, Bangladesh, China, India,
Japan, Korea, Democratic People’s Republic of Korea, Mongolia, Nepal, New Zealand,
Pakistan, Sri Lanka, Chinese Taipei, and other Asia Pacific countries and territories.4
Central and South America: Argentina, Plurinational State of Bolivia (Bolivia), Brazil, Chile,
Colombia, Costa Rica, Cuba, Curaçao, Dominican Republic, Ecuador, El Salvador, Guatemala,
Haiti, Honduras, Jamaica, Nicaragua, Panama, Paraguay, Peru, Suriname, Trinidad and
Tobago, Uruguay, Bolivarian Republic of Venezuela (Venezuela), and other Central and
South American countries and territories.5
China: Includes the (People's Republic of) China and Hong Kong, China.

Developing Asia: Asia Pacific regional grouping excluding Australia, Japan, Korea and
New Zealand.
Developing economies: All other countries not included in the “advanced economies”
regional grouping.
Eurasia: Caspian regional grouping and the Russian Federation (Russia).
Europe: European Union regional grouping and Albania, Belarus, Bosnia and Herzegovina,
North Macedonia, Gibraltar, Iceland, Israel6, Kosovo, Montenegro, Norway, Serbia,
Switzerland, Republic of Moldova, Turkey and Ukraine.
European Union: Austria, Belgium, Bulgaria, Croatia, Cyprus2,3, Czech Republic, Denmark,
Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania,
Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovak Republic, Slovenia,
Spain, Sweden and United Kingdom.
IEA (International Energy Agency): OECD regional grouping excluding Chile, Iceland, Israel,
Latvia, Lithuania and Slovenia.
Middle East: Bahrain, Islamic Republic of Iran (Iran), Iraq, Jordan, Kuwait, Lebanon, Oman,
Qatar, Saudi Arabia, Syrian Arab Republic (Syria), United Arab Emirates and Yemen.
North America: Canada, Mexico and United States.
OECD (Organisation for Economic Co-operation and Development): Australia, Austria,

Belgium, Canada, Chile, Czech Republic, Denmark, Estonia, Finland, France, Germany,
Greece, Hungary, Iceland, Ireland, Israel, Italy, Japan, Korea, Latvia, Lithuania, Luxembourg,
Mexico, Netherlands, New Zealand, Norway, Poland, Portugal, Slovak Republic, Slovenia,
Spain, Sweden, Switzerland, Turkey, United Kingdom and United States.
Southeast Asia: Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic

Republic (Lao PDR), Malaysia, Myanmar, Philippines, Singapore, Thailand and Viet Nam.
These countries are all members of the Association of Southeast Asian Nations (ASEAN).
Country notes
1
Individual data are not available and are estimated in aggregate for: Burkina Faso, Burundi, Cabo Verde,
Central African Republic, Chad, Comoros, Djibouti, Equatorial Guinea, Kingdom of Eswatini, Gambia, Guinea,
Guinea-Bissau, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Réunion, Rwanda, Sao Tome and
Principe, Seychelles, Sierra Leone, Somalia and Uganda.
2
Note by Turkey: The information in this document with reference to “Cyprus” relates to the southern part
of the Island. There is no single authority representing both Turkish and Greek Cypriot people on the Island.
Turkey recognises the Turkish Republic of Northern Cyprus (TRNC). Until a lasting and equitable solution is
found within the context of the United Nations, Turkey shall preserve its position concerning the “Cyprus
issue”.
3
Note by all the European Union Member States of the OECD and the European Union: The Republic of
Cyprus is recognised by all members of the United Nations with the exception of Turkey. The information in
this document relates to the area under the effective control of the Government of the Republic of Cyprus.
B

4
Individual data are not available and are estimated in aggregate for: Afghanistan, Bhutan, Cook Islands, Fiji,
French Polynesia, Kiribati, Lao People’s Democratic Republic (Lao PDR), Macau (China), Maldives, New
Caledonia, Palau, Papua New Guinea, Samoa, Solomon Islands, Timor-Leste and Tonga and Vanuatu.
5
Individual data are not available and are estimated in aggregate for: Anguilla, Antigua and Barbuda, Aruba,
Bahamas, Barbados, Belize, Bermuda, Bonaire, British Virgin Islands, Cayman Islands, Dominica, Falkland
Islands (Malvinas), French Guiana, Grenada, Guadeloupe, Guyana, Martinique, Montserrat, Saba, Saint
Eustatius, Saint Kitts and Nevis, Saint Lucia, Saint Pierre and Miquelon, Saint Vincent and Grenadines, Saint
Maarten, Turks and Caicos Islands.
6
The statistical data for Israel are supplied by and under the responsibility of the relevant Israeli authorities.
The use of such data by the OECD and/or the IEA is without prejudice to the status of the Golan Heights, East
Jerusalem and Israeli settlements in the West Bank under the terms of international law.
Abbreviations and Acronyms

AC Africa Case
APEC Asia-Pacific Economic Cooperation
ASEAN Association of Southeast Asian Nations
CAAGR compound average annual growth rate
CCGT combined-cycle gas turbine
CCUS carbon capture, utilisation and storage
CH4 methane
CHP combined heat and power; the term co-generation is sometimes used
CO2 carbon dioxide
CO2-eq carbon-dioxide equivalent
CPS Current Policies Scenario
CSP concentrating solar power
EU European Union
EV electric vehicle
FAO Food and Agriculture Organization of the United Nations
FDI foreign direct investment
GDP gross domestic product
GHG greenhouse gases
ICE internal combustion engine
IEA International Energy Agency
IIASA International Institute for Applied Systems Analysis
IMF International Monetary Fund
IPCC Intergovernmental Panel on Climate Change
LCOE levelised cost of electricity
LNG liquefied natural gas
LPG liquefied petroleum gas
LULUCF land use, land-use change and forestry
MEPS minimum energy performance standards
NDCs Nationally Determined Contributions

NOC national oil company
NOX nitrogen oxides
OECD Organisation for Economic Co-operation and Development

PM particulate matter
PM2.5 fine particulate matter
PPP purchasing power parity
PV photovoltaics
R&D research and development
SDS Sustainable Development Scenario
SO2 sulfur dioxide
STEPS Stated Policies Scenario
T&D transmission and distribution
TFC total final consumption
TPED total primary energy demand
UN United Nations
UNCTAD United Nations Conference on Trade and Development
UNDP United Nations Development Program
UNEP United Nations Environment Program
US United States
USGS United States Geological Survey
VRE variable renewable energy
WACC weighted average cost of capital
WEM World Energy Model
WEO World Energy Outlook
WHO World Health Organization

Annex C
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C

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Africa Energy Outlook 2019
This publication reflects the views of the IEA Secretariat but does not necessarily reflect
those of individual IEA member countries. The IEA makes no representation or warranty,
express or implied, in respect of the publication’s contents (including its completeness or
accuracy) and shall not be responsible for any use of, or reliance on, the publication.
Unless otherwise indicated, all material presented in figures and tables is derived from IEA
data and analysis.
This publication and any map included herein are without prejudice to the status of or
sovereignty over any territory, to the delimitation of international frontiers and boundaries
and to the name of any territory, city or area.

IEA Publications
Website: www.iea.org
Contact information: www.iea.org/about/contact
Typeset and printed in France by IEA - November 2019

Cover design: IEA
Photo credits: Getty Images
The paper used has been produced respecting PEFC’s ecological, social and ethical standards
Africa Energy Outlook 2019
Rapid economic and population growth in Africa,

particularly in the continent’s burgeoning cities, will
have profound implications for the energy sector,
both regionally and globally. The stage is set for a
new wave of dynamism among African policy makers
and business communities, with falling costs of key
renewable technologies opening up new avenues for
innovation and growth. Chief among the challenges
is providing universal access to reliable, modern,
affordable and sustainable energy. How to do this is a
crucial component of Africa’s Agenda 2063 strategic
framework for the continent’s future and of global
Sustainable Development Goals. Realising the
potential of the continent’s natural gas and mineral
resources presents another key challenge.
Five years after the World Energy Outlook’s first

special report on Africa, the International Energy
Agency has updated and expanded its outlook for
the continent based on in-depth, data-rich and
country-specific analysis. This new report provides
important policy insights to help African energy
stakeholders achieve the continent’s growth
ambitions in a sustainable and inclusive manner. It
also explores how the rise of consumerism in Africa
might affect global trends.

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Africa Energy

World Energy Outlook Special Report

World Energy Outlook Special Report

Africa Energy Outlook - Cover Layout.indd 4 31-10-2019 17:09:18

Classic Page 1.indd 1 21-10-2019 10:53:41

Classic Page 1_A4.indd 1 21-10-2019 10:55:38

Dr. Fatih Birol

4 Africa Energy Outlook 2019 | Special Report

Mechthild Wörsdörfer, Director of STO, provided guidance throughout the project.

Emmanouil Christinakis (independent consultant), Dr. Andriannah Mbandi (Stockholm

Christian de Gromard Agence Française de Développement (AFD), France

6 Africa Energy Outlook 2019 | Special Report

Isabel Murray Department of Natural Resources, Canada

8 Africa Energy Outlook 2019 | Special Report

2 Urbanisation, industrialisation and clean cooking 79

3 Access to electricity and reliable power 113

3.2 Outlook for electricity access 116

4 Natural gas and resource management 155

10 Africa Energy Outlook 2019 | Special Report

6 Regional and country energy profiles 205

The Africa Case points the way to a brighter future

14 Africa Energy Outlook 2019 | Special Report

Renewables push ahead to power Africa’s brighter future

Natural gas can be a good fit for Africa’s industrial growth

16 Africa Energy Outlook 2019 | Special Report

Climate change matters in Africa, making resilient policy decisions critical

Policies will play a crucial role in determining Africa’s energy future

18 Africa Energy Outlook 2019 | Special Report

This introduction covers:

Figure I.1 ⊳ Africa’s share of selected global indicators

10% 20% 30% 40% 50% 60% 70%

Africa accounts for a low share of the world’s energy demand

20 Africa Energy Outlook 2019 | Special Report

22 Africa Energy Outlook 2019 | Special Report

Focus countries and country profiles

Understanding the scenarios

Box I.2 ⊳ Agenda 2063: the future that Africa wants

24 Africa Energy Outlook 2019 | Special Report

Country/Region 2000-2018 2018-2040

Table I.2 ⊳ Population assumptions

* CAAGR = compound average annual growth rate.

Figure 1.1 ⊳ Selected indicators for Africa, 2000, 2010, 2018

Population GDP Energy demand

1 000 6 000 600

500 3 000 300

2000 2010 2018 2000 2010 2018 2000 2010 2018

Africa’s urban population is expanding fast

Note: GDP = Gross domestic product in PPP terms, $2018.

Chapter 1 | Africa today 27

28 Africa Energy Outlook 2019 | Special Report

Figure 1.2 ⊳ Annual GDP growth rates in selected African economies

the continent as a whole is forecast to accelerate to 4% in 2019, up from an estimated 3.3%

Chapter 1 | Africa today 29

Figure 1.3 ⊳ Shares of value added and employment by sector in

North Africa Sub-Saharan Africa Other dev. economies

Value Employment Value Employment Value Employment

Agriculture accounts for a very large share of employment in

30 Africa Energy Outlook 2019 | Special Report

1.1.2 Demographics and urbanisation