Powering Up in Africa: Electricity Demand Stimulation to Build Inclusive Economies, Reduce Inequality, and Improve Power System Sustainability

Abstract

Purpose of Review: Even with increasing electricity access rates, electricity consumption remains low in Sub-Saharan Africa. To remedy this, policies and strategies to stimulate electricity demand are increasingly critical to ensure socio-economic development in the region. This review summarizes approaches to stimulating electricity demand in different sectors of the economy and highlights key policy considerations to make the electricity sector commercially viable and sustainable in Sub-Saharan Africa. Recent Findings: Recent demand stimulation strategies include facilitating the growth of existing electricity consumption among residential and commercial customers through appliance financing, and tariff subsidy programs, replacing existing non-electric productive energy uses such as irrigation and agro-processing in the agricultural sector, promoting the adoption of electric vehicles and electric cooking technologies, and establishing new electricity-based enterprises in different sectors of the economy. Summary: While current demand stimulation strategies have promising socio-economic benefits, their commercial viability and sustainability hinge on key policy considerations that address fundamental gaps, calling for further research in this area.