1. Return on Investment in Africa’s infrastructure
will far outweigh costs. Infrastructure develop-
ment is a top priority for African administrations.
Access to power plays a key role in this program.
Roughly 600 million people in Africa, nearly twice
the population of the United States, are living
without access to electricity according to a 2011
study. They represented 43% of the 1.4 billion
people worldwide who lacked regular access to
electricity.
The majority of these people are concentrated in Sub-
Saharan Africa, and not necessarily in remote villa-
ges. For example, Kenya’s Electrification Authority
reports that while 73% of Kenyans live within one kilo-
meter (0.6 miles) of a transformer, only 18% are con-
nected to the grid. Thirty seven countries in sub-
Saharan Africa have a national electrification rate of
below 50 percent.
A 2010 World Bank report estimated that poor infra-
structure like power shortage curbs African economic
growth by 2 percent per year and business productivi-
ty by 40 percent. One study estimates that the broa-
der returns to infrastructure investment can reach 50
percent when accounting for GDP growth, while the
World Economic Forum found that each dollar spent
on infrastructure returns anywhere from 5 percent to
25 percent.
A second factor is the rapidly falling cost of renewable
energy. Africa has some of the world’s best potential
sites for wind, solar and hydropower. Investors are
proving readier to test the market by putting up a few
windmills than by committing to big power stations.
Wind farms and solar parks can also provide decen-
tralised or “off-grid” power directly to customers, re-
ducing the load on congested transmission lines. Giv-
en the high cost of power from diesel generators in
Africa, renewable energy can be an attractive alterna-
tive.
Many African countries receive on average a very
high amount of days per year with bright sunlight.
Most of the sunniest places in the world are on the
African continent, due to the general low cloud cover
in the sky. This gives solar power the potential to
bring energy to virtually any location in Africa without
the need for expensive large scale grid level infra-
structural developments. We can actually consider,
the African continent has on average more than
3,000 sunny hours on year-based average. The dis-
tribution of solar resources across Africa is fairly uni-
form, with more than 85% of the continent's land-
scape receiving at least 2,000 kWh/(m² year).
Declining solar equipment costs are expected to sig-
nificantly increase solar installations in Africa with an
industry projection forecasting that the continent's
annual PV market will expand to 2.2 GW by 2018.

2. Ghana’s power deficit represents enormous oppor-
tunities for foreign direct investment as well as pub-
lic-private partnerships in the energy sector, Minis-
ter of Trade and Industry, Ekwow Spio-Garbrah,
has declared to some 600 top global business
leaders attending the Africa CEO Forum in Gene-
va, Switzerland.
According to Dr. Spio-Garbrah, the deficit of some
500 megawatts of power and the projections for
additional power demand in Ghana has led to more
than 20 proposals being submitted by a wide range
of companies from the US, Germany, Denmark,
India, China, South Africa, Turkey, Brazil and
others for thousands of megawatts of additional ge-
neration.
These projects are from all sources of energy, in-
cluding gas, coal, wind, solar, biomass, waste-to-
energy, mini-hydro and even sea wave. On ac-
count of these developments, Dr. Spio-Garbrah
was convinced that the medium term prospects for
Ghana’s industrialisation were good.
Kenya has stepped up its efforts to transform
40,000 acres of land into a wind farm, in a bid to
meet growing demand for electricity. The 300
MW Lake Turkana Wind Power Project, which is
being developed in the country's North-East, hopes
to produce 20% of the country's current installed
electricity generating capacity when it comes online
in 2016.The $694 million project achieved full finan-
cial close in December 2014, making it the largest
private investment in Kenyan history. The project is
one part of the country's ambitious project to add
5,000 MW of power onto the grid in the next three
years.
Nigeria’s determination to generate an additional
500MW from solar PV by this year and create a ba-
se for increasing the capacity to 4,000MW by
2025, appear to be on course after the recent sig-
ning of a major renewable energy development
deal with a global clean energy development joint
venture.
The agreement between the government of Nigeria
and SkyPower FAS Energy, a joint venture bet-
ween SkyPower Global and FAS Energy in
May, for the development of 3000MW of utility-
scale solar PV projects in the West Africa nation in
the next five years, has boosted the country’s ef-
forts to generate 18% of its electricity from renewa-
ble sources by 2030.
The $5 billion solar PV investment by SkyPower
FAS Energy, to be developed in phases, is part of
Nigeria’s strategy of pursuing an integrated rene-
wable energy development programme that would
enable it meet an anticipated annual electricity de-
mand of between 6390MW and 10,800MW by
2020 up from the 3760MW.
Meanwhile in South Africa Renewable Energy Invest-
ments South Africa (RF) Pty Ltd (REISA) commenced
commercial operation of the Kathu Solar PV facility –
one of the largest photovoltaic projects in South Africa
– on 11 November 2014. The project is expected to de-
liver 179GWh of clean energy into the grid annually,
equivalent to the electricity requirements of 68,000 low
income households in South Africa.
REISA CEO, Richard Gordon, says “The shareholders
in REISA recognise that effective infrastructure is vital
for the economic growth and development of the Afri-
can continent. This project has over 340,000 installed
solar photovoltaic modules with a combined generating
capacity of 75MWac and is producing energy under a
20-year PPA signed with the Single Buyer Office, deli-
vering clean renewable energy to the Northern Cape
and South Africa with a low environmental impact.”.
The project brought together an investment consortium
consisting of African Infrastructure Investment Fund 2
(AIIF2), the Infrastructural Development and Environ-
mental Assets (IDEAS) Managed Fund, BuiltAfrica
Kathu 75 Solar, Building Energy Development Africa
and the Kathu Solar Community Trust.
The IDEAS Managed Fund is managed by Old Mutual
Alternative Investments, a boutique of Old Mutual In-
vestment Group. The fund is the most successful inves-
tor in South Africa’s renewable energy program with 14
investments, and has delivered a return of 10% above
inflation over 15 years.
And with the current changes in lowering costs and all
the more possibilities returns may rise to 25% or more.