Leadership failure and energy poverty in African economies

The management of the energy sector is crucial in the governance structure in every system because ‘energy is life’ and it is strategic to the sustainable flow and existence, through human efforts, for economic determination and actualisation. This socioeconomic importance demands the full attention of leaders, and the total participation of everyone within the system, for an uninterruptible provision and supply of energy, in running an economy for both wealth creation (at micro and macro levels) and overall economic prosperity. Energy is a serious business that a good government should prioritise to grow an economy. This task of prioritisation, ironically, is the reverse in most African economies because of continent-wide leadership challenges that manifest in bad governance lacking the ability to build up the confidence of prospective external business partners that could come in with foreign direct investment (FDI) in the energy sector.

Sound economic management is germane to the actualisation of good governance where the leadership does not record failures in the economic indices for measuring the performance of the economy. It effectively deals with the issues of productivity, reduction of unemployment and, most importantly, reduction of inflation that could spark off incremental growth in the economy. Good leadership, however, requires that a leader is surrounded by people with diverse perspectives, who can freely and objectively disagree with him, without fear of retaliation. Failures in leadership in African economies can be attributable to weak institutions, which often result from a poor corporate governance structure.

These pointers are directly and indirectly responsible for the ongoing energy poverty within African economies. This is against the fact that Africa is favourably positioned by nature to take advantage of providing diverse forms of energy in abundant quantities. Such a position ought to structure their performances to be net exporters of energy products in the energy-mix value chain, depending on their respective comparative advantage at their respective locations, when the economic principles of demand and supply are also taken into consideration.

   Energy poverty involves total lack or poor provision in situations of energy scarcity for communities and to urban cities, where energy supply and distributions are consumed by people and business entities, for power generation in carrying on daily economic and commercial activities. In Nigeria, scarcity of energy or inadequate power supply is an endemic challenge. The problems it poses have deeply affected the economy through power outages experienced by manufacturers in virtually all the existing industries. This has, consequently, adversely affected productivity/GDP growth in the economy. The impact of the high cost of production in the economy has forced many investors to relocate their operations to other neighbouring countries (like Ghana) within the ECOWAS sub-region. The power distribution companies that are located at various locations within the economy (on the other hand) appear not to be meeting up with demands through the national grid; which equally has resulted in the energy crises that characterise the power sector today. The inability to effectively apply basic management functions (Planning, Organising, Controlling, and Motivation) is the major factor that leads to the failures of our leaders, who don’t properly instruct the management and coordinate their efforts for efficiency.   

At this juncture, the influence of the energy transition through a plan that considers the role of green energy for sustainable economic growth in Africa should be robustly discussed; especially with the advantage Africa has in the generation and efficient production of renewable energies (Solar, Wind and Hydro) all through the twelve months of the year. The tropics stand the advantage of cheap production of solar energy from the enormous availability of sunlight by building solar farms in various locations where its comparative advantage is higher than setting up wind farms or hydro-dams. These are natural privileges African governments freely enjoy as against the Western countries that have limitations due to their climates or weather conditions (that are not sustainable all through the year). The energy-mix value chains ought to be considered by African economies in such a way that they don’t only change the narrative of the poorly managed energy poverty but that they transit to exporting energy (competitively) to Western economies as net exporters of whatever renewable energy that they produce in abundance. This should reposition such economies as energy rich nations and reverse their status economically.

In conclusion, our vast underutilised lands in the continent, with the advantage of abundant supplies of daily sunlight, need to be leveraged on to put such untapped potential to proper economic use for wealth creation. What the leaders (those in authority) need to actually do is to prepare an enabling environment that would encourage the promoters of business and investors in the private sector (especially those already operating in the energy industry); to entrepreneurially look in that direction and grow their respective economies, as well as contribute towards national economic growth and development.