20 March 2014, Lagos – These investments need to be catalysed and supported by targeted public expenditure, policy reforms and regulation changes. This development path should maintain, enhance and, where necessary, rebuild natural capital as a critical economic asset and source of public benefits, especially for poor people whose livelihoods and security depend strongly on nature – UNEP
Over the course of two days, 4th and 5th March 2014, Africa had a dose of fresh blood infused into the deepest veins of her renewable energy industry. It happened at Sarova Panafric Hotel, Nairobi, Kenya, when the Solar and Off-Grid Renewables Africa, an event organised by the UK-based Solar Media Limited, brought together top industry and government figures in one place. In the event that was first of its kind in Africa, experts and pundits put heads together from the meeting room to the exhibition hall; small time solar installers and big-time module manufacturers mingled; industry prospectors homed in on solid innovators. Certainly, the resounding spark this all-time solar industry mesh engendered shall continue to reverberate all over Africa for decades to come. And we shall be better off for it.
Firstly, it is not an accident that the United Nations Environment Programme is headquartered in Africa. For the purpose of its Green Economy Initiative, UNEP has developed a working definition of a green economy as one “that results in improved human well-being and social equity, while significantly reducing environmental risks and ecological scarcities.” In its simplest expression, a green economy can be thought of as one which is low carbon, resource efficient and socially inclusive. Then, practically speaking, a green economy is one whose growth in income and employment is driven by public and private investments that reduce carbon emissions and pollution, enhance energy and resource efficiency, and prevent the loss of biodiversity and ecosystem services. Of course, there is no hands-on technology that could achieve the above tenets as fast as renewable energy innovations, especially via the solar industry.
What is more, this industry needs a subsisting robust policy infrastructure, and properly conjoined demand-supply dynamics, before it could find a place in the sustainable development tableau. The Solar and Off-Grid event was able to add this value. East Africa became a microcosmic template for gauging the emerging African solar market; and because the public sector and the organised private sector were able to talk across the table in a frank interface, one could easily decipher unspoken trends and tailor these nuances into the development of the other African regions.
Secondly, considering the fundamental role technology transfer plays in entrenching development, the Nairobi event was able to set new trends and open up new opportunities in the solar industry. Participants were able to come in contact with table-turning innovations. Take for example, the Powerhive brand, which is a technology platform that enables the financing and monetisation of distributed microgrids. Tackling the challenging issue of proper metering and tracking of off-grids consumption, this “cloud-based” system empowers customers to pre-pay for their electricity from their mobile phones, thereby efficiently and effectively bringing electricity to power-short markets.
According to www.alternativepowermedia.com, a Nigerian alternative energy website, the effect this and other support systems could have on an emerging solar market like Africa can never be overemphasised. One, it turns a solar microgrid into a safe, predictable investment as it enables businesses to provide their customers with a fully operational energy service without any up-front capital investment from the customer. This is the kind of investor climate incentive that enables up-starts to put their feet in the water of unpredictable markets that exist in many developing countries. Two, it has the potential to automatically turn solar projects into sure-banker businesses. Just like a financier, Adam Hammond, disclosed to newsmen, “When you are dealing with these smaller scale projects, what it really comes down to is the financing model and how they are collecting cash from customers – if you can prove that. For example, here (the Solar and Off-Grid conference) we have some really innovative software and hardware guys that are able to take prepayment for electricity from villagers without any problem whatsoever, and I have no problem financing them.”
Thirdly, harried African installers came in contact with solar products of established pedigree. Nigerian participants were able to connect to manufacturers who have proven solar products that could change the country’s iffy market. A solar systems installer from Lagos, the country’s commercial hub, Valentine Aigbogun, said the problem most technicians usually encountered in Nigeria was access to authentic products, as it took experience to recognise the authentic modules in the midst of many substandard products. Interestingly, the market is so volatile that any report of a non-performing solar module wipes off many potential customers off the hopeful list; it is like a vicious circle. He added, “My country needs to move fast in this solar revolution but we are weighed down by the existence of under-performing solar modules and power backups. But here I, and other Nigerian installers, have discovered authentic products that are affordable compared to what we have been exposed to before now.”
Fourthly, a solar market network has been ignited in Africa. The comparative pedestal for regional players is surely needed for the industry to move to the next level in Africa. There were new concepts to be assimilated by pundits, and trends to be internalised by policymakers. These threw up fresh ideas on how to tackle continuing power challenges in the region. For instance, as learnt from Col Ayay Reddy from Uganda, instead of spending so much on rural electrification it becomes more practical, and wiser, to engage hybrid structures. And for us in Nigeria, the lessons from the Kenya Renewable Energy Association, as the organised private sector driving the industry, could never be forgotten in a hurry, because this is exactly what is needed today to catalyse the promising industry over here.
Recently, it was reported that the United States’ Minnesota Public Utilities Commission voted to become the first state in the nation to come up with a methodology for calculating the value of solar power generated by consumers – and not just how much that power is worth to the utility company and its customers, but to society and the environment as a whole. In view of this, a green economy expert commented that the decision by the lawmakers could influence other states as they evaluate how to move forward with their own solar-related policies, as America currently witnesses a blossoming of solar energy deployment and usage in the country, and needs to determine unit value that each user adds to the grid. This is exactly how an isolated policy move can set a new agenda for progress.
Likewise, the Solar and Off-Grid Nairobi event has defined a new golden dawn for the solar industry in Africa. After knowing about the manifest opportunities existing in the emerging industry at the conference, the visibly taken Mr James Mureu, Chairman, East Africa Chamber of Commerce, asked, “What shall we do about all this? Why haven’t we invested in this direction all along?”
For us in Nigeria there is an urgent need to look more in the direction of renewables and off-grid/stand alone power sources. We have just been named among the four emerging economies of the world – MINT – but the truth is that we can only disappoint optimists if our energy industry maintains the current status of less-than-satisfactory. The world is fast moving towards the direction of renewable energy, and yet we have not charted a comprehensive national renewable energy policy framework. The private sector players have no incentives and our vast market is wide open to all-comers with all sorts of substandard products seeping into the local market and killing the little confidence some people have in renewables; this trend is as a result of poor regulation and a competitive policy road map. If we must make an impact as an emerging global player, now is the time to join other nations in the renewable energy revolution.
– Greg Odogwu, The Punch