African power: A sector under transformation

Group of Multiethnic Diverse Busy Business People

The three-day African power generation and distribution conferences and expo got underway at the Cape Town International Convention Centre with over a thousand power sector stakeholders from across Africa and abroad meeting to discuss African power challenges, opportunities, investment and technologies.

Meeting the continent’s power demands is now more important than ever before. With an investment of around $450 billion needed in Africa’s power infrastructure to reduce power outages and reach the 600 million sub-Saharan Africans who do not have access to electricity, collaboration and integration are going to be crucial.

In a keynote delivered on behalf of South African Energy Minister Tina Joemat-Pettersson, Jacob Mbele, and chief director: Energy in the Ministry, said the South African government was implementing both short and long term strategies to address the country’s power challenges. Its integrated energy plan encompassed significantly more than just additional power generation, he said. It looked to demand and supply, environmental impact, technology and skills transfer, funding and the increased use of renewable resources.

New Eskom CEO Brian Molefe noted: “Only through collaboration can Africa find solutions to its power challenges.” However, he was optimistic that African countries were making good progress toward the goal of affordable, reliable power for all. “There is a positive energy propelling Africa’s progress,” Molefe said. “The vision of a future African super grid comes a step closer with progress on shared projects such as the Grand Inga hydropower project between South Africa and the DRC.”

Sicelo Xulu, MD of City Power and president of the Association of Municipal Electricity Utilities (AMEU) of southern Africa described the sector as an industry in a state of transformation.

“We need to innovate in order to survive,” he said. Xulu pointed to infrastructure modernisation, digitisation, smarter grids capable of better load management and big data analytics as tools that would help the sector adapt to meet changing demands. He noted that municipal electricity utilities faced a number of challenges in maintaining levels of service and increasing capacity. Among them were load shedding, the theft of copper, illegal connections, service delivery protests, municipal funding and skills and capacity constraints.

Meanwhile, Taylor Ruggles, the US Department of State's regional energy counsellor for Africa, noted that it was virtually two years since US President Barack Obama had launched the Power Africa programme in Cape Town. The programme took a transaction-based approach to addressing the continent’s power challenges, he said. “A constant theme we see is the need for an environment that is enabling to investment. You need strong, transparent legal and regulatory frameworks.”

Arnaud de Limburg chief executive officer at Avon Peaking Power Co said that what governments and utilities saw as challenges, independent power producers (IPPs) saw as opportunities. “Africa is the next big thing and is high on the agenda of international investors. But investment depends on political and regulatory stability, and totally transparent processes,” he said.

While numerous hurdles stand in the way of Africa’s vision of providing affordable, reliable electricity to 600 million people who currently don’t have access to power, the speakers agreed that with collaboration and innovation, Africa could present a solid business case for private sector investment in African power infrastructure that delivered benefits to investors and the continent’s economy as a whole.

Leigh Angelo

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Issue 39