A new World Bank study on how Africa’s electricity providers can be profitable and still make electricity affordable at African Utility is expected to be unveiled in Cape Town, South Africa from May 16-18, 2017.
The study which dwell mainly on the financial health of electricity utilities in Sub-Sahara Africa, showed that, “Rather than tariff increases, cost reductions are often the best first step towards financial viability”
The study also presents a sobering assessment of the financial health of electricity utilities in Sub-Sahara Africa, and suggests how utilities can be profitable while extending affordable services for the poor.
Lucio Monari, Director, Energy and Extractive Global Practice at the World Bank, said of the study that, a central but under-reported issue on the movement to reach universal access is the financial health of electricity utilities.
“Less than half of utilities cover operating expenditures while several countries lose in excess of US$0.25 per kWh sold. In this context, it will be difficult for utilities to maintain existing assets, let alone facilitate the expansion needed to reach universal access goals,” said Monari.