More than 100 years after the light bulb was invented, the majority of Africa still finds itself in the dark after sunset. Scholars struggle to study, businesses can’t compete globally and realise their full potential, medical clinics are unable to operate effectively and industries come to a grinding halt, hampering economic and social growth and employment.
Today some 25 countries in sub-Saharan Africa are facing a crisis evidenced by rolling blackouts. Although the African continent is home to rich sources of both fossil fuels and renewable resources, these are not evenly distributed, creating windfall profits for some countries and exacerbating the crisis in others.
According to the World Bank, since the mid-1990s, external finance to Africa’s power sector has averaged only around US$600 million per year of public assistance, plus a similar volume of private finance. More recently, Chinese, Indian and Arab sources have also emerged as significant energy financiers.
It has been estimated that doubling current levels of energy access by the year 2030 will require sustained investment at much higher levels. [Sustainable energy for all requires $1trn annually.]
We spoke to experts at African Utility Week 2016 who pointed to distributed generation as a real game changer for Africa when it comes to boosting access figures.
Creating virtual community power plants
Martin Dunlea, Utilities Global Business Unit Industry Strategy, Oracle explained that the growth of distributed renewable solutions is an ideal platform for much of the African continent to consider as it enables efficient and more cost effective access when compared to larger transmission projects.
He added that distributed renewable solutions will create virtual community power plants which will efficiently extend energy into rural or isolated communities. He also highlighted how utilities can embrace the changing business model and provide new opportunities and new revenue streams for themselves as they deliver new services and solutions for their customers. Distributed generation can also help utilities better manage the challenges around consumer growth around the grid, he explained.
Dunlea did point out that renewables growth can present challenges around intermittency and that in response, distribution companies should develop smarter platforms to manage this growth.
Distributed generation to leapfrog central grid power
Frank Spencer, Business Development Manager, Conco Energy Solutions talks about the need for utilities to change the traditional way of thinking when it comes to generation. He said that utilities should consider shifting from the central grid to more distributed technologies to improve access and reliability. He explained that globally this methodology is changing and that Africa should not be focusing on baseload but rather the ability to deliver the capacity and energy that is required. He said: “Utilities need a different way of looking at and designing energy systems.”
Spencer also pointed out that utilities run the risk of becoming obsolete if the private sector adopted distribution technologies for themselves. He said that it makes sense for businesses to build their own private power plants so utilities need to plan ahead and prepare themselves for this trend.
While South Africa has a more established transmission and distribution network, he believes that there is still a need for sparsely populated areas to develop its distributed generation in order to increase access to power. He says that distributed generation will in time leapfrog central grid power just like mobile phones have overtaken landlines.
Eradicating power poverty
James (“Jim”) E. Rogers, Former CEO and Chairman of the Board, Duke Energy, USA in his presentation at the conference spoke about the importance of accelerating access to electricity in Africa. He pointed out that both distributed renewable energy and grid extension would be the solution to Africa’s low access figures.
He explains that investment is needed across the board when it comes to Africa’s electricity. These areas include central station plants, the modern grid, and in distributed energy for remote areas.
Rogers says that electricity is often overlooked when it comes to assisting those who are poverty-stricken and should actually be prioritised. He says that electricity should be viewed as an enabler which can address many other pressing issues in Africa.