Energy access remains a huge problem for most people living on the African continent. More than 600 million out of a population of about 1.3 billion people in sub-Saharan Africa don’t have reliable electricity access.
Although sub-Saharan Africa has about 13% of the world’s population, about 48% are without energy access. Only seven countries in the sub-region – Cameroon, Côte d’Ivoire, Gabon, Ghana, Namibia, Senegal and South Africa – can boast of 50% access rates.
And, with the exception of South Africa, the energy consumption rate is 150 kilowatt per capita, way below emerging market estimates.
At current deployment rates it will be 2080 before every African has access to electricity. But that can change if governments make it easier for entrepreneurs to enter the arena.
Entrepreneurs in the energy space
The African region currently gets the bulk of its energy supply from fossil-fueled power generation (60%). Other sources include hydroelectric dams (32%) and bio-fuel (7%). Wind, solar and geothermal sources constitute approximately 1% of the energy mix .
Increasing pressure on the grid has seen many African countries diversify their energy sources. Clean coal, gas-powered thermal plants and off-grid solar solutions are becoming increasingly important.
On top of this Africa’s energy potential remains under-exploited. In an era where private investors and public funds are receding entrepreneurship is vital to Africa’s economies. With a swathe of technologies opening up, entrepreneurship poses a big opportunity for African innovators.
The energy entrepreneur is well-positioned to take advantage of the opportunities presented by the sector. But where can they realistically get involved?
Solar offers one potential area. Projections are that by 2050 solar PV will represent 16% of the total global electricity mix. It’s estimated that small-scale off-grid projects operating in rural areas have the potential to power half the world.
Solar PV offers sustainable investment opportunities for entrepreneurs due to advances in solar PV technologies.
Entrepreneurs are already beginning to seek out opportunities. The most successful are those with local knowledge who’ve identified appropriate solutions specifically for their communities.
One example is Off-Grid Electric in Uganda. It provides low-cost, environmentally-friendly power sources for lighting, cooking and for charging phones. It reaches 50,000 people each month.
There’s also M-Kopa Solar in Kenya. It provides for mobile phone charging and a boasts a solar powered radio. M-KOPA claims 450,000 homes solar instalment in Kenya, Tanzania and Uganda.
Shatki Energy is a South African energy startup producing lighting to support 2.3 million off-grid users. One of its main products is the Nuru LED light which when fully charged can produce up to 20 hours of lighting.
These success stories shouldn’t overshadow the fact that being an energy entrepreneur is a lot tougher than it seems.
Providing energy is generally the government’s job. That alone is enough to dissuade new entrepreneurs. Governments have traditionally subsidised and collaborated with large utilities and grid-based electricity provision. But they haven’t done much for the small-scale off-grid or micro-grid solutions.
There are several ways in which governments can help redress this imbalance.
One is clear and active about grid extension planning. This would mean off-grid or microgrid entrepreneurs would not be undermined by new extension projects. Keeping small-scale operators in the loop and allowing them a voice is crucial.
Regulatory clarity and opaque policy formulation is also needed. In the right environment, small-scale energy providers can use their agility and on-the-ground knowledge to create successful businesses to meet local demand conditions. But this will require regulatory innovation and new administrative processes.
There are also issues with subsidies, levies and duties. Governments must make sure that, at the very least, energy entrepreneurs operate on equal terms with established energy businesses. One simple step, recommended by the World Resources Institute, would be to shift subsidies from specific fuels, like kerosene, to energy services, like lighting provision.
They must also ensure there are no disincentives for financiers to invest in small-scale energy start-ups.
Another, recommended by Lighting Africa, is to take a close look at import duties on equipment like solar panels. Given developments in the sector many import taxes may no longer be appropriate.
And finally governments must make it easier for entrepreneurs to start businesses. For instance, with the exception of Mauritius, no other country in sub-Saharan Africa appears on the World Bank Global Index when it comes to the ease of doing business.
The project aims to help businesses develop and commercialise innovative solutions to climate change. It provides local companies with the knowledge and resources to prototype, develop and market innovative clean technologies in sectors like climate smart agriculture, waste management, water purification and energy efficiency systems.
The project is in its early stages and the clients are mainly green entrepreneurs focused on climate related needs.
These can be spaces where potential funders meet entrepreneurs, explore their operating space and the validity of their ideas. And entrepreneurs can also get the basic training to run successful commercial enterprises.
It’s also crucial to be realistic. Inevitably some energy access projects will fail while others will thrive. But that’s what entrepreneurship is all about.
It’s time governments on the continent step up and give Africans the opportunity to help themselves.
GE’s APM Digital Solution Will Help Reduce Unplanned Downtime and Enhance Operational Performance
LAGOS, Nigeria, October 24, 2019- GE Will Modernize Seven GE LM6000PC Aeroderivative Gas Turbines and Install Its Asset Performance Management (APM) Digital Solution at Dangote Cement Plants in Obajana and Ibese, Nigeria;Contract Includes Service Agreement Extension for Additional 50,000 Operating Hours for Each of the Seven GE LM6000PC Aeroderivative Gas Turbines; GE’s APM Digital Solution Will Help Reduce Unplanned Downtime and Enhance Operational Performance; GE’s Total Plant Solutions Will Improve Power Supply Efficiency and Help Extend the Life of the Cement Plants
GE (NYSE: GE) and Africa’s leading cement producer Dangote Cement Plc signed an agreement to deploy GE’s Asset Performance Management (APM) digital solution to reduce unplanned downtime and enhance performance at its two cement plants in Obajana and Ibese, Nigeria. The project includes extending the current service agreement for an additional 50,000 operating hours for the seven GE LM6000PC aeroderivative gas turbines installed at the sites. GE’s total plant solutions will improve efficiency, reliability essential to continuous operations and the plants’ business strategy.
“Power supply is both a key input and a major cost in our manufacturing process,” said Ravi Sood, Operations Director, Dangote Cement Plc. “Operational performance is crucial to our cement plant’s overall productivity, directly affecting end products. Being at the front of cement production in Africa, we believe extending our services agreement with GE and the introduction of digital solutions will allow us to improve efficiencies, anticipate further reductions in unplanned downtime and become more self-sufficient in power production in a country which, with approximately 190 million inhabitants, is the most populous country in Africa and the seventh most populous country in the world.”
APM leverages cutting-edge technology to monitor the performance of power generation assets to reduce downtime, avoid turbines damage and remotely predict and resolve issues. APM sensors will be installed not only on the seven aeroderivative turbines, but also on their associated generators and gear boxes to predict and accurately diagnose issues with greater accuracy before they occur.
“Energy infrastructure is getting smarter, and digital solutions allow not only the shift from traditional calendar-based repairs to predictive maintenance, but they also increase power asset availability and reliability,” said Elisee Sezan, CEO for GE’s Gas Power businesses in sub–Saharan Africa. “We are proud to continue our 13-year collaboration with Dangote Cement to help them support Nigeria and other African countries towards achieving self-reliance and self-sufficiency in the world’s most basic commodities.”
For many years, Cameroon’s national electricity supply has been notoriously unreliable and subject to power cuts. The last significant electric system outage, which lasted eight hours, occurred last March and affected several of the country’s regions (the Far North, North, Littoral, Adamaoua, South and Centre regions).
However, three projects financed by the African Development Bank for $121.4 million in 2010-2011 are at last starting to provide long-suffering Cameroonians with much more reliable electricity.
Completion of work on transport lines, line maintenance and especially the replacement of wooden electricity transport poles with concrete poles are all part of the system improvements, whose goal is to increase the quality and reliability of public access to electricity.
The Lom Panga storage reservoir project is complete, but the dam’s generating plant is still under construction. In the meantime, two other power plants, Kribi and Dibamba, have begun working to strengthen Cameroon’s generating capacity.
In November 2011, the African Development Bank awarded $62.9 million for the construction of Lom-Pangar, the hydroelectric generation’s ‘lungs’ in the country’s East region. The project included the construction of a reservoir (6 billion cubic meters of water retained) for regulating the Sanaga’s flow and optimising generation during low water periods at the Song Loulou plant (335 MW) and the Edea plant (224 MW). The production from these two plants has grown from 450 MW in 2011 to 729 MW now.
A 30 MW hydroelectric generating plant is under construction at the base of the dam. It will be linked to the Bertoua thermal plant by a 105 km 90kV line that should start to work in May 2021 following the installation of an evacuation station and the construction of its four turbines. Lom-Pangar will provide electricity to 150 locations in the region and will significantly reduce power cuts in the area.
“The Lom-Pangar dam will help save water in other reservoirs,” said Theodore Nsangou, the General Director of the Electricity Development Corporation (EDC), in an interview with a government publication in March 2018.
The 216 MW capacity Kribi gas-fired generating plant began to work in 2013 after receiving $32.8 million from the African Development Bank in July 2011 for an expansion project. Its production goal is 330 MW. Currently, the power plant has a 100 km 225 kV transport line connecting it with the Magombe substation in the Edea region in the country’s South region. The plant operates with natural gas (with light fuel oil as emergency backup) from the Sagana South offshore gas field.
During the dry season, the Kribi plant and its nine simple cycle gas turbines are truly the system’s “oxygen”, maintaining the country’s energy flow, particularly to the South’s interconnected system, which receives its electricity from Kribi.
The Kribi gas-fired generating plant and the Dibamba generating plant provide access to electricity for close to half of Cameroon’s population.
The Dibamba heavy fuel oil generating plant was also designed to meet the serious problem of power cuts during the dry season. It was the first of the three plants to receive financial support from the African Development Bank of $25.6 million in April 2010. Built to mitigate the country’s shortage of electricity, high demand quickly outpaced its capacity the day after it began operations.
Located in the outskirts of Douala, Cameroon’s second largest city, Dibamba is an 86 MW thermal generating plant with a 2 km 90 kV transport line linked to the network serving the most remote and densely populated areas in the country’s West region.
With an estimated 23,000 MW hydroelectric production capacity, Cameroon has the second largest hydroelectric potential in Africa and the 18th largest worldwide. The country plans to complete the development of its hydroelectric industries by 2035. Construction of the Nachtigal hydroelectric generating plan began in 2019 and will be complete in about five years, with an estimated generating capacity of 420 MW.
The African Development Bank has awarded a funding package of $154.8 million for the completion of this generating plant. Other development partners, such as the World Bank, the European Investment Bank and Proparco, are also involved.
New York, USA: September 24, 2019- The United Nations Development Programme (UNDP) and the Sahara Group have unveiled the Africa Renewable Energy Forum to boost access to sustainable energy for 10 million households in Africa through alternative energy initiatives and interventions.
Launched at the margins of the 74th UN General Assembly in New York, the Africa Renewable Energy Forum is expected to bolster ongoing partnership between UNDP and the Sahara Group that aims to create access to clean and affordable energy in Africa.
The forum will serve as a platform for policy discussions, multi-stakeholder collaboration and funding towards implementation of tailored renewable energy solutions across the continent. Ultimately, the platform will galvanise the political momentum needed to record significant progress through strong partnerships, effective regulation and mutual accountability.
The event had senior officials from both organisations in attendance including, Ahunna Eziakonwa, Regional Director and Assistant Secretary General for UNDP Regional Bureau for Africa, as Kola Adesina, Group Managing Director, Sahara Power Group, Pearl Uzokwe, Director, Governance and Sustaianability, Sahara Group, Bethel Obioma, Head Corporate Communications, Sahara Group and Babatomiwa Adesida, Private Sector Engagement Specialist, Sahara Foundation.
Africa has the highest percentage of untapped hydropower potential in the world, with only 11% utilization capacity. Whilst the global electrification rate reached 89% in 2018 and 153m people gained access to electricity (WB Stats, May 2019), the biggest challenge remains in the most remote areas globally and sub-Saharan Africa in particular, where an estimated 573m people are not connected to grid power.
With over 600 million Africans having no access to electricity, Ahunna Eziakonwa said the continent urgently needs to embrace renewable energy sources to sustainably connect the poorest and hardest to reach households. “Access to energy will enhance the cause of poverty alleviation and also yield huge benefits for education, healthcare, production, and socio-economic development. The UNDP-Sahara partnership is extremely crucial as it will provide a model for engaging a wide range of stakeholders to address the continent’s energy challenge in line with the SDG framework,” Ahunna stated.
Kola Adesina said the initiative has the potential to create over one million jobs in Africa as the continent continues its march towards achieving the 2030 SDG Agenda. “Renewable energy is still in its infancy as far as Africa is concerned. We need unrelenting awareness initiatives to inspire a mindset shift to renewable energy in Africa with the various governments, private sector and development agencies leading the charge. At Sahara Group we believe that interventions like the UNDP-Sahara partnership will enhance productivity and shared prosperity in Africa.”