Bill to Expand Access to Electricity in Africa Clears Senate Foreign Relations Committee

Press Release

The Senate Foreign Relations Committee has approved legislation co-sponsored by U.S. Senator Chris Coons (D-Del.), chair of the Senate Foreign Relations Subcommittee on African Affairs, to facilitate first-time access to electricity for nearly 50 million people across sub-Saharan Africa. The Energize Africa Act of 2014, which will now head to the Senate floor, will promote public and private investment in projects designed to increase electricity access and reliability across the continent. The efforts -- part of President Obama's Power Africa initiative -- will add up to 20,000 megawatts of electricity to the grid in the next six years.

"Access to reliable energy is critical to Africa's growth and prosperity, and to increased economic partnerships with the United States," Senator Coons said. "Africa's future is more promising than ever before, but widespread energy poverty and a lack of access to distributed energy infrastructure is holding back too many countries across the continent. The Energize Africa bill brings the public and private sectors together to expand energy access, develop new power sources, promote renewables and distributed energy solutions, and support improved energy sector governance. Reliable energy is the foundation of vibrant economies, and I'm proud we've been able to come together in a bipartisan way to strengthen critical energy partnerships between the U.S. and Africa."

Seventy percent of sub-Saharan Africans -- and 85 percent of those living rural areas -- are currently living without access to electricity. Pervasive energy poverty undermines economic growth and development goals in health, education, and institution-building and has been cited by businesses as one of the most significant impediments to business growth on the continent.

The Energize Africa Act will enhance and provide congressional authorization for Power Africa, a collaborative, interagency effort launched last year by President Obama with the goal of doubling access to power in sub-Saharan Africa by 2020. The House of Representatives approved similar legislation, the Electrify Africa Act, by an overwhelming margin in May.

The legislation includes the following components:

Requires the President to create a comprehensive strategy for United States' engagement with sub-Saharan Africa in developing a broad mix of power solutions to increase electricity access and reliability;

Encourages the Overseas Private Investment Corporation (OPIC), USAID, the U.S. Department of Treasury, World Bank, U.S. Trade and Development Agency, and African Development Bank to prioritize loans, grants, and technical support that promote private investment in projects designed to increase electricity access and reliability;

Authorizes OPIC to continue ongoing work through 2019 and provides limited additional authorities specifically for use on power projects in sub-Saharan Africa.

These authorities for sub-Saharan Africa power projects include:

Expedited procedures for small projects,

Promoting partnerships between U.S. joint ventures and African partners to develop responsible electricity generation,

Lending to encourage investments in the power sector in Africa by making certain U.S. investors eligible for loans of $50 million or less,

Expands local currency guaranties for local branches of foreign banks, and

Extends term of assistance possible for renewable energy projects;

Creates a new inspector general for OPIC;

Allows OPIC to hire a limited number of temporary employees; and

Commissions OPIC's new inspector general to provide a report on OPIC's ability to support infrastructure and energy projects and evaluate if the ability to invest directly in projects would help or hurt support for such projects.

Senator Coons chaired a hearing in the African Affairs Subcommittee in March to examine the Power Africa initiative and inform consideration of the Senate bill.

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