Guest Blog: Rewriting the textbook for African power utilities

06 Oct 2016

Off-grid solutions are often discussed as if they are the total fix for Africa’s electricity problems but, as Barry Rawn, Brunel University London, and Trevor Gaunt, University of Cape Town, argue, there is still a vital space for improving centralised grid systems across the continent.

Fast-growing African countries like Nigeria, Zambia and Zimbabwe often have national electricity grids that are stressed financially and technically: they may allocate load, rather than following demand, and cost recovery of investment from fixed charges is often not possible. There is a need in some cases to create new methods and theories to deal effectively with design, operation, and upgrading of these systems.

Although promising off-grid solutions are exponentially deploying, our view is that we still need original approaches to make optimal use of poorly maintained legacy systems– and new technologies and capabilities are always waiting in the wings to help us transform both how people and engineering systems work, with early examples being prepayment managed through mobile phones.

Last month, we organised a roundtable discussion in London on these questions where participants from academia, finance, and consultancy discussed risks, technology, and new approaches for power utility firms operating in African countries. Workshop participants made the point that excessive focus on just one aspect of electrification to the neglect of the larger picture can lead to disastrous policies. Exploiting the potential of disruptive technologies, similar to the penetration of mobile phones in the African telecommunications sector, was seen as an opportunity, despite the electricity sector’s need for physical conductor. 

The round table recognised that energy density, desired availability and reliability, and ability to pay are all factors that ‘select for’ a given infrastructure. In the early days, customers were those with sufficient funds to pay for energy, mostly for industrial production. Later, the concept of electrification expanded to include social and political objectives like universal access. National investment and subsidies for network extension and connections mostly by nationalised utilities were effective in the USA (1930s), Ireland (1950s), Brazil (1970s) and South Africa (1990s).

In the 1990s, a new culture swept through the industry, with governments breaking up the vertically integrated monopolies, reintroducing private electricity companies, and establishing competitive markets for generation and retailing.  In Africa, the results have been mixed. 

Where did participants see their next steps, and what did they learn? Some participants anticipated engineering and financial standards as a scaffolding for steady but pragmatic progress to solidify ongoing experience. Others felt perspective and honesty was crucially needed to align what are sometimes conflicting and not always forward-pushing efforts between aid, business, and governmental spheres. Cleaning up the corruption that steals efficiency from both public and private initiatives is key, as is understanding the relationship between cost and capacity when supplying small customers.

Ultimately, how can an electricity utility serve its customers as their number and demand grows? A national central grid is perceived to offer efficiency through vertical integration and coordination of resources, contribute to national poverty reduction, and require simple regulation. Decentralised, private sector utilities are seen to offer freedom from bureaucracy, efficiency through competition, rapid development, adoption of novel technologies, and movement towards carbon reduction. Both are answers to a question that cannot be properly addressed without revisiting fundamental questions about electrification, such as, competition, technical choice, and the role of the customer.

Dr Barry Rawn is a Lecturer in Power Systems at Brunel University London. Professor Trevor Gaunt is Professor Emeritus in the Electrical Engineering Department of the University of Cape Town (South Africa).