NEWS Dr. Rebekah Shirley provides a roadmap for energy access in “The Conversation”April 20, 2018

For the orig­i­nal piece, click here. 

by Dr. Rebekah Shirley is Research Direc­tor at Power for All and Vis­it­ing Research Scholar, at the Strath­more Energy Research Cen­ter (SERC) at Strath­more Uni­ver­sity and both alumni and Post-​​doctoral Fel­low at RAEL.

At least 110 mil­lion of the 600 mil­lion peo­ple still liv­ing with­out access to elec­tric­ity in Africa live in urban areas. Most are within a stone throw from exist­ing power grid infrastructure.

In Nige­ria, Tan­za­nia, Ghana and Liberia alone there are up to 95 mil­lion peo­ple liv­ing in urban areas. All in close prox­im­ity to the grid. In Kenya about 70% of off-​​grid homes are located within 1.2km of a power line. And esti­mates for “under-​​the-​​grid” pop­u­la­tions across sub-​​Saharan Africa range from 61% to 78%.

Besides energy access being cru­cial for many basic human needs, these under­served pop­u­la­tions rep­re­sent a mas­sive com­mer­cial oppor­tu­nity for cash-​​strapped sub-​​Saharan African util­i­ties. Elec­tric­ity providers could reach tens of mil­lions of densely packed cus­tomers with­out the cost of a last-​​mile rural grid extension.

So, why aren’t these poten­tial con­sumers con­nected to the for­mal grid?

Urban com­mu­ni­ties often face many chal­lenges in obtain­ing elec­tric­ity access. These range from the pro­hib­i­tively high cost of a con­nec­tion, to the chal­lenges of infor­mal hous­ing, the impact of power theft on ser­vices and socio-​​political mar­gin­al­i­sa­tion. In many cases, these obsta­cles are dif­fi­cult to address successfully.

How­ever, recent advances in dis­trib­uted renew­able energy tech­nolo­gies mean a more afford­able, faster to deploy, cleaner alter­na­tive is at hand in Africa. One that can step in where pol­icy and util­ity reforms are wanting.

Bar­ri­ers to grid connections

One of the major bar­ri­ers to elec­tri­fi­ca­tion is the cost of a grid con­nec­tion. A grid con­nec­tion in Kenya, for instance, is esti­mated at USD $ 400 per house­hold. This is nearly one-​​third of the aver­age per capita income of a Kenyan.

Beyond pure cost bar­ri­ers, urban com­mu­ni­ties often can’t access energy ser­vices for other socio-​​economic rea­sons. For instance, not being metered because they don’t have a for­mal address. Or liv­ing in in an area that is dif­fi­cult to ser­vice – such as near flood plains or in infor­mal hous­ing settlements.

Cor­rup­tion among elec­tric­ity ser­vice providers, power theft by cus­tomers and the estab­lish­ment of elec­tric­ity car­tels also com­pli­cates and lim­its elec­tric­ity access.

Finally, the util­i­ties them­selves face many chal­lenges in imple­ment­ing reforms to get more peo­ple con­nected. Take the exam­ple of the Kenya Power and Light­ing Com­pany, which owns and oper­ates most of the elec­tric­ity trans­mis­sion and dis­tri­b­u­tion sys­tem. In 2015 it intro­duced a sub­sidised con­nec­tion fee of US $150. This was done through the Last Mile Con­nec­tiv­ity Project. In one year, this installment-​​based pay­ment plan led to a 30-​​fold increase in legal elec­tric­ity con­nec­tions in impov­er­ished neighbourhoods.

But the project was marred by cost over­runs and inflated and mis­re­ported new con­nec­tion num­bers. On top of this, newly con­nected house­holds often have very low con­sump­tion lev­els and low-​​income cus­tomers were often unable to make pay­ments, even at sub­sidised rates.

With­out the nec­es­sary infra­struc­tural devel­op­ment, experts argue that the pro­gram puts a strain on the tech­ni­cal, com­mer­cial and finan­cial resources of the util­ity. This means that the pro­gramme may find it dif­fi­cult to gen­er­ate rev­enue, recover costs or pro­vide the ser­vice intended to new customers.

Decen­tralised renewables

Decen­tralised renew­able energy tech­nolo­gies offer an impor­tant solu­tionfor “under-​​the-​​grid” elec­tri­fi­ca­tion. They are sim­ple, fast and agile. They have short instal­la­tion times, and offer a reli­able elec­tric­ity ser­vice for infor­mal settlements.

Pay-​​as-​​you-​​go solar sys­tems and appli­ances, for exam­ple, can pro­vide a much lower bar­rier to entry. Com­pared to the high upfront con­nec­tion costs noted ear­lier in Kenya, a 15-​​watt solar home sys­tem costs on aver­age USD $9 per month for 36 months after which point the house­hold owns its system.

The renew­able energy sec­tor recog­nises this under-​​the-​​grid mar­ket. In fact, about 35% of solar light­ing prod­uct sales in Kenya are made in peri-​​urban areas. And it’s a good bet. Evi­dence shows that the will­ing­ness to pay for decen­tralised renew­ables is much higher than a grid con­nec­tion because they are seen as more reliable.

Poli­cies to sup­port decen­tralised tech­nolo­gies include: inte­grated energy plan­ning that incor­po­rates these solu­tions, adopt­ing and enforc­ing prod­uct qual­ity con­trol stan­dards and pro­vid­ing finan­cial incen­tives – like reduced import duties for prod­ucts or local loan and grant programs.

These solu­tions show that with the right approach, and sim­ple inno­va­tions, Africa’s prospec­tive urban cus­tomers can finally get access to electricity.

Ben Attia, a Research Con­sul­tant with Green­tech Media, con­tributed to the writ­ing of this article