The African Development Bank has kicked off a feasibility study to explore the potential of electricity cooperative business models in Nigeria and Ethiopia. The effort is part of the Bank’s goal of achieving universal electricity access across Africa by 2025. Currently, power shortages diminish the region’s GDP growth by 2-4% per year, holding back job creation and poverty reduction efforts.
The study, funded by the South-South Cooperation Trust Fund, will be conducted by the National Rural Electric Cooperative Association (NRECA) International over three months. NRECA will consider regulatory, legal, technical and socio-economic factors that impact the creation of electric cooperatives in the two nations.
Over the past five years, Africa has seen an explosion in growth of residential solar and mini-grid companies, driven by lower cost solar and batteries, ubiquitous mobile money platforms and innovative financing mechanisms. These companies have found ways to deliver power to millions of African consumers for the first time and have started to show how countries within Africa can be leaders of the future global energy system, a system that will be distributed, smart, and renewables-based.
Despite these promising efforts from the private sector, however, companies working to get power to more than 600 million people without access to power still face massive policy and financing headwinds. While public sector grid extension projects are heavily subsidised by large-scale donor and government programmes, residential solar and mini-grid firms are largely left without such concessional financial support. Instead, private firms focused on energy access are directed to find ‘commercially viable models’ for rural electrification, even though their public sector counterparts are heavily subsidised, and rural electrification has never been achieved without concessional financial support on any continent in the history of the world. The historical precedent of supporting rural energy access is an important one, as it helps to avoid the morally and politically untenable situation where the rural poor pay the highest price for power.
Ministry of Water, Irrigation and Electricity has signed MoU with Gulf Electricity Interconnection Authority and the International Energy Linking Organization (GEIDCO) to start feasibility study of electricity link between Ethiopia and the Gulf Cooperation Council countries. The MoU was signed on Saturday, January 12, 2019 in Abu Dhabi, the United Arab Emirates (UAE), according to the online newspaper Sabq-sa.com.
Water, Irrigation and Electricity Minister Engineer Sileshi Bekele said on the occasion the interconnection of energy between countries, regions and continents is one of the most important ways to unite people for mutual benefit and economic prosperity.
The issues surrounding lighting Africa can seem daunting and, if not for key success stories, even insurmountable. But Kenya’s recent success — going from a mere 25 percent electricity access rate to 73 percent in just six years — has been so out of line with normal trends that the World Bank’s reports on Sub Saharan Africa show electrification rates outpacing population growth for the first time. The metric, the Bank says, is being disproportionally driven by Kenya. The Kenya story clearly shows that these problems can and should be tackled.