Africa never managed to build a proper telephone cable network. And it will never need it. The continent has nearly 500 million mobile connections and only 12 million fixed telephone lines. Something similar could happen with energy.
Off grid solar energy is rapidly spreading. In the last few years over 7 million off-grid Africans have replaced their kerosene lamps with solar lights. This might be just 1 percent of the off-grid African population, but it is on a scale sufficient to introduce a technology that could disrupt the expected path of development. The reasons are at least four.
First, the change to the family budget that a solar light brings is significant. According to SolarAid, one of the organisations introducing solar lights to Africa, by replacing kerosene with solar power LED light in Tanzania, typically you can save more than a dollar a week. This is a significant amount of money for the 48 percent of the sub-Saharan people that live on less than $1.25 a day.
Second, solar power can be expanded and connected. You can get one panel and you will replace a kerosene lamp. Get two and you will be able to charge your mobile phone. Add another one and you can have a radio. With one more you might have a computer or a TV. In other words, the solar generation could add to your life different consumer products. And you can also team up with a neighbour and build a small local grid.
Third, the technological advances are staggering. The LED light uses five to 10 times less energy than the old incandescent light. Chinese, Spanish and German subsidies have turned photovoltaic panels into a commodity with a rapidly falling price. What looked 10 years ago like a rich government's game now is simply cheap. The cost of solar power is falling below new nuclear or gas generated power and even below coal, if you care to include into the electricity price the cost of all the environmental and health damage that coal causes.
Fourth, solar, and other renewable energy technologies do not need the hugely expensive power infrastructure required to bring the electricity generated by a nuclear reactor or a coal power block 2,000 kilometres to a poor African village.
Put these four reasons together and you will see that the traditional centralised power grid structure will lag far behind the economic and technological development of Africa. In other words, the off-grid electricity network will grow faster than the centralised energy economy. The centralised power grid economy will never be able to catch up with the faster growing off-grid economy.
By the time you secure financing for the 2,000 km grid to a remote village, it will have the LED lights at home and in school, chargers for mobiles phones, power for TVs and computers and mobile access to high quality education through the MOOC (mass online open courses) system.
There are already countries in Africa, like Rwanda, that are looking at a 100 percent renewable electricity option by 2020.
Obama promised more than $7bn for the Power Africa programme. The money will most likely go into grids and conventional energy projects. Bad choice.