Why a smart energy mix is key to Africa’s future

15May 2016
Costantine Muganyizi
Guardian On Sunday
Why a smart energy mix is key to Africa’s future

WITH more than half of its current 1.2 billion people having no access to electricity, Africa has no choice other than adopting a smart power mix for its future growth and prosperity.

The KivuWatt power plant in Kibuye on the shores of Lake Kivu, which President Kagame will inaugurate tomorrow. (Photo: Courtesy of ContourGlobal)

For that to happen, sectoral experts say governments needed to change the narrative to make the likes of solar power systems an integral part of the energy matrix. Equally important is the inclusion of independent, private-sector power producers in national grids to help set up rapid supply levels.

“A smart, mixed system of energy resources is the way forward,” was the general consensus of one of the sessions on the last day of WEF-Africa 2016 on Friday that explored how Africa could leapfrog towards developing a smart energy system.

Themed ‘Towards a New Energy Future’, the session, among other things, discussed how Africa can leverage renewable power sources to address the huge energy deficits in the continent. The panellists said that smart grid solutions could greatly help to enhance investments in renewable energy sources.

It is estimated that renewables can provide more than 40 per cent of all power generation in the continent by 2040. The session’s participants also strongly argued that leveraging digital and energy-efficient technologies, scaling investments into large power infrastructure and strengthening regional integration are pivotal to addressing Africa’s current and future power needs.

The East African Community bloc was highly commended for its joint power projects in terms of shared grids, power pools and cross border trade arrangements. Last month, Tanzania announced plans to undertake a $300 million project financed by the African Development Bank (AfDB) that will see it export electricity to Kenya in the next two years.

“Africa has no choice but to move rapidly towards a smart mix of energy systems if it is to grow and prosper in step with the rest of the world,” panellist Jubril Adewale Tinubu of Nigeria, the Oando Group Chief Executive and a member of the WEF Young Global Leader Alumni, said.

According to him, that more than half of the people in Africa have no access to power on a daily basis. And despite reliable power supply forming the basis of an industrialised economy many countries are aspiring to become, AfDB says in most of them, including Tanzania, access is less than 30 per cent.

The accessibility level in similar poor economies across the world is put at 40 per cent.

Tinubu said that conventional energy grids will not meet the massive and growing demand anytime soon, so private-sector involvement, small-scale projects and renewable technology must be developed to help fill shortfalls. He called for African governments to create enabling policies to allow the private sector to spur growth in the power sector.

“There is limited capital available for large power generation projects, traditionally built by government, yet there is explosive demand,” he said, adding:
“This makes power generation a good business opportunity – along with its obvious social benefits.”

Tinubu told the meeting that Africa is potentially the largest power market in the world if one counts in all resources and demand. According to him, that gives the continent a wonderful opportunity to leapfrog out of poverty by simply building robust energy generation capacity.

Erastus Mwencha, deputy chairperson of the African Union, said Africa does not have time for traditional power roll-outs. He noted that the much-anticipated Inga Dam hydro-electric project in DR Congo holds enormous potential – such as the capacity to light up all of Africa and much of Europe at the same time – but pointed out that it will take some time to realize its potential.

“The continent cannot transform without power. It cannot educate its children without power. Obviously, we need to move to a power mix, a diversity of technologies,” Mwencha argued.

Another panellist, Jasandra Nyker, the CEO of BioTherm Energy in South Africa, explained the much-applauded independent power producer programme in her country, noting that since the advent of the programme in 2009, 2.3 gigawatts of renewable energy had been installed.

She added that a number of private companies have taken up the opportunity provided by the South African government to contribute to power generation, with most of them “over-performing” in a relatively short space of time. She said a similar urgency has been brought to bear on small, renewable projects in Burkina Faso and Uganda.

“These might not be gigawatt-sized projects, but they are helping and adding value,” she said.
“The future of smart energy is very bright, with burgeoning business opportunities for both on- and off-grid technology,” she added.

The founder and CEO of American startup company Acumen, Jacqueline Novogratz, said power systems at the home level have proved to be highly successful, particularly in East Africa. The systems, she noted, are now ready for the market hence the need to accelerate methods of financing to scale them up.

According to her, African governments needed to “change the narrative” to make the likes of solar power systems an integral part of the energy mix.
“The time has come for us not only to be enabling, but also to be accelerating this technology,” Novogratz noted.