Conference will focus on financing Africa's power projects
Africa will require an investment of $42bn a year to meet the continent's energy demand by 2040, which includes a private sector financing increase of up to ten times the current levels. In order to achieve this, governments and business must work together and fresh approaches will be vital.
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This is according to Evan Schiff, event director of African Utility Week, taking place in Cape Town from 12 to 14 May. During this annual power and water conference and expo, a high-level Finance & Investment Forum will specifically focus on project finance, risk management, IPPs and case studies.
"Private equity fund raising for Africa increased by 136% in 2013 to $3.3bn, up from $1.4bn a year earlier. Greater private sector participation and competition has been encouraged through power sector reform and long-term power purchase agreements through the state utility or other credible off-takers.
"IPPs are considered a solution to persistent supply constraints. It is also exciting to see that intra-African investment is gaining momentum. African investors nearly tripled their share of FDI projects over the last decade, from 8.0% in 2003 to 22.8% in 2013," says Schiff.
Renewables and green energy
The Finance & Investment Forum will also have a special focus on renewables and innovative ways of financing green energy while creating sustainable jobs. "With the African Development Bank SE4LL Fund recently confirming a $777,000 preparation grant to support a 72MW solar power plant project to become the first renewable IPP in Cameroon, it shows that there are creative investment vehicles and initiatives out there for energy projects on the continent that previously were considered too marginal for project financing," he adds.
Bringing deals to point of bankability Power Africa, US President Barack Obama's initiative to improve access to power in sub-Saharan Africa, will be the official country partner of African Utility Week. Power Africa works with African governments, the private sector, and other partners to add more than 30,000MW of cleaner, more efficient electricity generation capacity as well as increasing electricity access by adding 60 million new home and business connections throughout sub-Saharan Africa.
Andrew Herscowitz is the coordinator for Power Africa and panellist at the Finance & Investment Forum: "we've seen that there is plenty of investor interest in the continent and there are plenty of people with great ideas and potential to execute power projects, but the problem that we see is getting those deals to the point of bankability," says Andrew Herscowitz, coordinator for Power Africa and panellist at the Finance & Investment Forum.
