The costs of providing access to electricity in selected countries in Sub-Saharan Africa and policy implications

Highlights: • Access to electricity is seen as key to reducing poverty. • Policymakers must accelerate new connections to meet Sustainable Development Goals. • A least cost electricity planning model is used to estimate the cost of access. • Cost of providing access is below the cost of alternatives such as kerosene lighting. • Electricity trade helps to reduce the cost of providing access to electricity. Access to reliable energy is recognised as a key driver of human and economic development. Despite this, today only 45% of the population in Sub-Saharan Africa has access to electricity. Sustainable Development Goal number 7 calls for ensuring access to affordable, reliable, sustainable and modern energy for everyone. Yet, at the current rate of progress, less than 60% of the population in Sub-Saharan Africa will have access to electricity by 2030. In view of the urgent need to accelerate the rate at which electricity access is provided, we developed a detailed least-cost optimisation model to identify the incremental costs of providing access for the group of 12 countries in the Southern African Power Pool. Our analysis shows that achieving universal access by 2030 in the region, would lead to an incremental generation cost of between 5.2 and 11.4 US$2018 billion, depending on the consumption of newly connected households. This corresponds to an increase of system generation costs by 4–8% and the levelized incremental cost of supply to the customer of 108–116 US$2018 per megawatt hour. This is lower than what a typical household pays for poor alternatives to electricity, such as kerosene for lighting, implying that policy makers should accelerate access.