investment did not bring the anticipated results. In Africa, the rate of investment in power infrastructure declined in the 1990s, reflecting slow economic growth. Only 5 GW of new capacity were added in the 1990s in sub-Saharan Africa. 3. Key factors driving electricity infrastructure investment Electricity supply is highly capital-intensive, with large lead times for building and bringing on stream new capacity. Because electricity is generally supplied in bulk over networks, investment tends to be driven by expectations of demand subject to adequate access to capital. Electricity companies project average and peak load in the near to medium term and attempt to build enough capacity in advance to meet that load. Errors in forecasting capacity needs can lead to sharp fluctuations in investment. The "lumpy" nature of power sector investment also contributes to this phenomenon. Economic activity is the primary driver of electricity demand, although the relationship is to some extent two-way. Economic growth stimulates demand for electricity services, while the expanded supply of electricity contributes to economic growth and development. Empirical analysis confirms that demand for electricity is closely linked to changes in gross domestic product. Over the past thirty years, the global economy grew by 3.3% per year on average, and electricity demand grew at 3.6%. The relationship is remarkably stable and broadly linear (Figure 3.5). However, this aggregate picture hides the fact that electricity intensity - the amount of electricity for each unit of GDP produced - has tended to fall in OECD countries, while it has risen in the rest of the world. This largely reflects Figure 3.5. World final electricity consumption and gross domestic product World Million tonnes of oil equivalent 1 400 1 000 10 000 20 000 30 000 40 000 50 000 60 000 GDP in billion dollars and PPPs ($2 000) Source: IEA databases. INFRASTRUCTURE TO 2030: TELECOM, LAND TRANSPORT, WATER AND ELECTRICITY - ISBN 92-64-02398-4 - © OECD 2006 3. OUTLOOK FOR 