Interview: Power Africa

Shari Berenbach

GEI: Please briefly share with the story and rationale behind Power Africa.

Shari Berenbach: The United States recognizes that energy is a significant constraint for Africa and it can have a catalytic effect on Africa. When we look at the tremendous economic growth that is taking place in Africa currently, one cannot help but be excited at recent trends, which offer a great opportunity for the continent. The U.S. government initiative, Power Africa, was created to help spur this catalytic effect by: 1) providing electricity for more manufacturing and more economic growth and 2) extending the delivery of power to more parts of Africa so that more segments of the African population can benefit from and participate in the economic growth trajectory.

We believe that Power Africa is good for Africa, and also good for U.S. business, including the export of major infrastructure equipment. Undoubtedly, from a development standpoint, it was an absolutely compelling reason to focus on Africa’s energy constraints, which are choking Africa’s economic and human potential in the short and the long-term.

GEI: How different is the Power Africa model from past models of development assistance. With the Power Africa experience, are we entering into a new era of public-private partnership as the cutting-edge of development policy?

Shari Berenbach: To me, what is really exciting about Power Africa is the realization that what Africa needs today is foreign direct investment and commercial and private capital flows, not just overseas development assistance. It is very heartening to know that private capital flows are beginning to dwarf the overseas development assistance in Africa. So one of the important things about Power Africa is that it has enabled the unleashing of private capital into Africa. You would agree with me, that, today, private enterprise has emerged as an integrated element of economic growth in Africa.

With regard to the Public-Private Partnership, I wanted to make two main points:

  • One of the most significant sessions at the African Leaders Summit in Washington, DC, 4-5 August 2014, was the U.S. African Business Forum, where we saw tremendous interest among leaders to participate in the Forum. There is a clear recognition on our as well as other stakeholders’ part that for Power Africa to be successful, it has to be a joint effort of public and private sectors.
  • Another important feature of Power Africa is its focus on policy reform that will create a level playing field and a more conducive environment for the private sector. In this context, the role of transaction advisors in Power Africa’s target countries is important. This innovative approach of development, I think, in some ways, is a bigger break from past practices in development assistance.

Once again, this same spirit was seen at the African Leaders Summit where the overall tone was all about how the U.S. and African nations can work together to address Africa’s developmental goals. It is not “we are the benefactors and you are the recipients;” it is, “how can we partner together in a much more dynamic, impactful way?” I think that Power Africa is an important legacy that President Obama will be leaving.

GEI: What kind of coordination mechanism does Power Africa have with other major international energy initiatives, like the UN’s Sustainable Energy for All ?

Shari Berenbach: There is a very active coordination through the Office of Special Envoy and Coordinator for International Energy Affairs in the State Department. The coordinator of this office has been an active participant at the UN’s initiative Sustainable Energy for All (SE4All). I do think that there is a tendency among UN-related institutions to focus more on governments and/or NGOs as the implementing vehicles and institutions as opposed to our approach, which is focused more on economic activities and private sector investment.

While there is a slight difference in orientation, there certainly is a lot of overlap. I think the UN recognizes that private companies have an important role to play, just as we recognize the need of household-based solutions for lighting clinics and schools. These consumer-based solutions are very important in addition to providing energy for productive purposes. Power Africa might be considered a next-door neighbor for the UN’s SE4All.

We have also worked very closely with the World Bank. In terms of collaboration with the European Union, Power Africa has begun discussions on how to collaborate.

I would also like to emphasize that Power Africa is a comprehensive U.S. government effort in which USAID plays a very prominent and coordinating role vis-à-vis the Departments of State and Energy, OPIC, the Export-Import Bank and others. Throughout, there have been coordinating meetings across all the different agencies, and I think that all of us who are working on this challenge are very excited at the potential to overcome the lack of electrification in Africa. It is right before our hands. It is doable over the next 20-30 years.

GEI: Please share with us more about the Power Africa Off-Grid Energy Challenge – an important component of Power Africa.

Shari Berenbach: The initial focus of Power Africa’s transactions was on large power plants near urban centers and industries. However, the U.S. African Development Foundation is mandated to support grassroots economic development. We target the very poorest of Africa and those people primarily live in the rural areas. I quickly recognized that it is great that we are expanding the grid via power plants, but we need to think about off-grid energy solutions to meet the needs of rural communities.

I would like to believe that Africa will not repeat the U.S.’s approach of having a focus on a national grid that connects one place to the next. For Africa, being such a large landmass, my sense is that you will have grids that are in urban areas, major metropolises, etc., but that there will be another generation of what I call off-grid energy solutions that might be micro grids or mini-grids, or even household level solutions like solar-land lighting.

This interest in off-grid solutions led us to launch the Off-Grid Energy Challenge. The Challenge asks: how does an entrepreneur really create a viable business that is generating and distributing energy in these rural areas? We have been doing this in partnership with GE Africa and this was first launched in 2013 with a total of six awards in Kenya and Nigeria. And, by mandate, the U.S. African Development Foundation provides support to only 100% Africa-owned and managed companies.

This year, twenty-two African companies/organizations won the Power Africa Off-Grid Energy Challenge with each receiving a grant of $100,000. Their projects all focus on how renewable energy resources can be deployed to power productive activities within communities in Africa. These winning projects include 14 solar developments, six biogas generation projects, one wind turbine system and a small hydroelectricity power plant. We believe these innovative solutions to meet the energy needs of undeserved communities will provide a solid base to scale and grow.

GEI: Indeed off-grid solutions play an important role in meeting Africa’s energy challenges and with Power Africa in the lead, the continent seems to entering into a new phase of light and progress. Thank you for sharing your thoughts for Global Energy Affairs.

Shari Berenbach: Absolutely, and it is an exciting time with a lot of innovation, new approaches, and new ways to bring energy to Africa and change the developmental scene of the continent. Power Africa has already initiated this beginning, and as said earlier, it will be an important legacy of President Obama. Thank you.

Shari Berenbach is President of the US-African Development Foundation

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