Energy investments and sustainable development in Africa

Abstract

There is no lack of energy sources in Africa ‐ especially fossil fuels ‐ however many countries in Sub‐Saharan Africa continue to be plagued by energy shortages. This can seriously impede productivity particularly in SME’s and add to energy costs through the need for investment in own generating capacity. In addition the transmission systems are often expensive due to ‘down time’ and this also raises production costs. It also raises costs for households that are effectively forced to generate their own power. This chapter examines three dimensions of the energy ‘gap’ in the context of a number of countries. First, will investment in energy capacity lead to sustainable GDP growth? Second, would investment in renewable or ‘green’ energy capacity make a significant difference? And third, is energy output really such an essential prerequisite for sustainable economic growth?