A Decentralized Energy Access Strategy - Presentation

8/10/2019 A Decentralized Energy Access Strategy - Presentation

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Africa Decentralized Energy

Access Strategy Discussion

Mary WillcoxPrincipal Consultant, Energy


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Introduction

Achieving the SE4All goal - Universal Energy Access

by 2030 - in Africa is a major challenge

Decentralized solutions offer one of the key strands in

meeting this challenge

This strategy paper discusses:

the range of decentralized solutions;

their characteristics; and

actions needed for their successful deployment

It complements the Africa SE4All Guidelines and the

global strategy for Bottom-Up Energy Solutions


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Strategy Objectives

Highlight the need for decentralized solutions

Raise awareness and understanding of

decentralized energy options

Explore the conditions and inputs needed for theirsuccessful deployment

Propose a process for incorporating decentralized

solutions in national Action Plans

Discuss how a shift from small projects to scale-ableprogrammes can be achieved

Identify areas for support from the SE4All Hub


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Decentralized Energy Need and Benefits

Universal access to clean energy services is an essential

enabler of inclusive development; poverty reduction;

enterprise development; achievement of the MDGs and

reduction of the gap between rich and poor.

Access to modern energy can transform lives:

Improved cookstoves reduce indoor pollution, with health benefitsespecially to women and children

More efficient stoves reduce the burden of gathering fuel and

benefit the environment Solar lanterns/chargers enable children to study at home and

facilitate communications and improved market access

Solar powered refrigerators allow vaccines to be stored safely

A village water mill can increase incomes and reduce drudgery


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Offer an alternative for those beyond the economic reach

of grid extension

Can target specific disadvantaged groups to support

development and poverty reduction

Can be deployed rapidly through market chains which

become self-sustaining

May support local supply chains and job creation, with

greater local value retention

Are often renewable-based, providing low-carbon

development and reduced vulnerability to fossil-fuel prices

Can be delivered at scale through coordinated

programmes


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Incorporation in ActionPlans

Decentralized and Centralized Energy Access

Solutions have different success factors

=>

Need to incorporate Decentralized Options and their

requirements in to Action Plans alongside

Centralized Solutions


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Incorporation in ActionPlans - Process

Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets

Review decentralized (and

centralized) solutions

(economics, financial/other

requirements, scale

potential)

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potential

Scale Programmes

Formulate Action

Plans & set Targets


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Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets




requirements, scale

potential)

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potential

Scale Programmes

Formulate Action

Plans & set Targets


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Measuring Energy Access

SE4All Global Tracking Framework

Tier 0 1 2 3 4 5

Electricity services None

Electric lighting,

radio, mobile

phone charging

Tier 1 + multi-

bulb lighting,

air circulation,

TV

Tier 2 + water

heater, rice

cooker

Tier 3 +

refrigerator,

mechanical

loads

Tier 4 + electric

cooking, space

heating and

cooling

Energy supply

attributes

Mini-grid Mini-grid Mini-grid

Grid Grid Grid

Likely electricitysupply technology

(indicative)

None Solar lanternStand-alone

home system

Continuous spectrum of improving energy supply attributes including:

quantity (watts), duration (hrs), evening supply (hrs), affordability,

legality, quality (voltage)

Indicative multi-tier framework for household electricity access


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Measuring Energy Access

SE4All Global Tracking Framework

Indicative multi-tier framework for clean cooking

AttributesTier 0 1 2 3 4 5

Self-Made or

BCCK1cookstove with

Tier 0 technical

attributes and without

CCA

Self-Made Cookstove

or

BCCK cookstove with

Tier 0 technical

attributes with CCA,

or BCCK cookstove

with Tier 1 technicalattributes without

CCA

BCCK cookstove with

Tier 1 technical


or BCCK cookstove

with Tier 2 technical

attributes withoutCCA

BCCK cookstove with

Tier 2 technical


or BCCK cookstove

with Tier 3 technical

attributes withoutCCA

BCCK cookstove with

Tier 3 technical


or BLEN2cookstove or

BCCK cookstove with

Tier 4 technicalattributes without

CCA

BLEN cookstove or

BCCK cookstove with

Tier 4 technical

attributes and with

CCA

Technical

Conformity,Convenience &

Achievement

Likely Cookstove

Technology

(indicative)

Incre asing technical specification (Efficiency, Indoor Pollution, Overall Pollution &

Achievement of Conformity, Convenience & Achievement adds one Tier

BCCK = Biomass, Coal, Charcoal or Kerosene

BLEN = Biogas, LPG, Electricity, Natural Gas


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Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets




requirements, scale

potential)

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potential

Scale Programmes

Formulate Action

Plans & set Targets


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Decentralized Energy Characteristics for Comparison

Through life economics (cost $/day)

Capital requirements

Local value retention

Potential for scale

Market fit/enabling actions required Wider ecosystem fit/enabling actions required


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Prioritization of Cooking Options -

Economics

0.00

0.50

1.00

1.50

2.00

2.50

0 1 2 3 4 5

$/Day/HH

Anticipated Energy Access Tier

Fig 8 Household Cooking - Cost vs Access Tier

Wood/ Agricultural Residues

CoalCharcoal

Kerosene

Pure Plant Oil/Jatropha Seed

LPG

Biogas (concrete/polyethylene)

Bioethanol

Hydro Minigrid

Increasing levels of access using same fuel are achieved with increasing stove technology

Electricity (hydro minigrid) cooking costs have been calculated as the increment to a Tier 5electricity service, and would not be matched on a stand-alone basis


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Comparison of Cooking Options

Capital Required

0

50

100

150

200

250

300

350

400

450

$/HH

Fig 13. Household Cooking - User Capital Required byTechnology and Access Tier

EA User Capital


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Comparison of Electricity Options -

Economics

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

0 1 2 3 4 5

$/Day/HH


Fig 9 Household Electricity Service - Cost vs Access Tier

Solar PV

Biomass Minigrid

DG Minigrid

Solar Lanterns

Kerosene Lamps

Hydro Minigrid

Grid Extension 20km

Grid Extension 50km


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Economics

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 1 2 3

$/Day/HH


Fig 9 Household Electricity Service - Cost vs Access Tier

Solar PV

Biomass Minigrid

DG Minigrid

Solar Lanterns

Kerosene Lamps

Hydro Minigrid

Grid Extension 20km

Grid Extension 50km

Focussin g on Tiers 1-3:


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Economics

Relat ive costs are highly context specif ic:

0.00

5.00

10.00

15.00

20.00

25.00

1 20 300 1,000

$/Day/HH

Number of Households in Community

Fig 10 Variation in Cost of Household TEA Tier 2 Electricity Service with Technology &

Community Size

Hydro Minigrid

Solar PV

Biomass Minigrid

DG Minigrid

Grid Extension 50km

Grid Extension 20km


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Comparison of Electricity Options

- Capital Required

0

2000

4000

6000

8000

10000

12000

KeroseneLamps-T0

SolarLanterns-T1

DGMinigrid-T1

BiomassMinigrid-T1

HydroMinigrid-T1

SolarPV

-T1

GridExtension20km-

T1

GridExtension50km-

T1

DGMinigrid-T2

BiomassMinigrid-T2

HydroMinigrid-T2

SolarPV-T2

GridExtension20km-

T2

GridExtension50km-

T2

DGMinigrid-T3

BiomassMinigrid-T3

HydroMinigrid-T3

SolarPV-T3

GridExtension20km-

T3

GridExtension50km-

T3

DGMinigrid-T4

BiomassMinigrid-T4

HydroMinigrid-T4

SolarPV-T4

GridExtension20km-

T4

GridExtension50km-

T4

DGMinigrid-T5

BiomassMinigrid-T5

HydroMinigrid-T5

GridExtension20km-

T5

GridExtension50km-

T5

$/HH

Fig 12. Household Electricity - Access Provider and User CapitalRequirement by Technology and Access Tier

EA User Capital

EA Provider Capital


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Comparison of Options

A Key Debate

Giving priority to achieving universal access at Tier 2 or 3 will

maximize benefits to those at the bottom-of-the-pyramid and

achieve the greatest possible impact with resources available

BUTEvidence from Asia indicates that delivery of minimalist

energy services focused simply on the basic energy needs of

poor households (lighting homes and cooking) is not effective

in poverty reduction

The conclusion reached on this issue of principle will strongly

influence the focus of national Action Plans and the balance

between centralized and decentralized solutions


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Comparison of Energy Options

Expected Local Value Retention

Capital

Equipment

Costs

Civil &

Installation

Costs

Fuel & Other

Operating

Costs Overall

Centralized Generation + Grid Extension L M n/a L

Renewable Minigrids M H n/a MDiesel Minigrids L H L L

Solar Home Systems L H n/a L

Renewable Pico-Generators M H n/a H

Diesel Pico-Generators L H L L

Biogas systems H H n/a H

Improved Charcoal/Biomass Cookstoves H H n/a HLPG Cookstoves M n/a L L

Solar lanterns L n/a n/a L

Kerosene Lamps L n/a L L


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Scale Potential

CSP PV Wind Hydro Biomass Geothermal

Central Africa 299 616 120 1,057 1,572

Eastern Africa 1,758 2,195 1,443 578 642 88

Northern Africa 935 1,090 1,014 78 257

Southern Africa 1,500 1,628 852 26 96

Western Africa 227 1,038 394 105 64

Total Africa 4,719 6,567 3,823 1,844 2,631 88

(TWh)

Africa is endowed with vast untapped renewable energy resources - IRENA


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Decentralized solutions can provide access at scale but this iscontext specific:

Hydro-powered minigrids are only economic where the

hydro resource is close to the community to be supplied

Biogas may be economically attractive, but may not be

viable in urban areas where space is at a premium

Charcoal + improved cookstoves may provide a low-cost

optionbut only within the limits of the sustainableavailability of charcoal

Geo-spatial mapping can assist in establishing proximity

between population and energy resources and hence optimum

energy access mix


Scale Potential


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Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets

Review decentralized

(and centralized)

solutions (economics,

financial/other

requirements, scale

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potentialScale Programmes

Formulate Action

Plans & set Targets


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Market Mapping

The private sector will play a key role in energy access provision

particularly for decentralized solutions

Mapping decentralized energy access markets can assist in

identifying which offer the best prospects for development

Typical Market Map of a char dust Briquetting project from Senegal (FAO, 2009)


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Market Mapping

Participatory market mapping also provides a means of:

- Identifying actions needed to catalyze market development

- Ensuring that all relevant stakeholders, including civilsociety organizations, are engaged in the national Action

Plan development process, and that the views of poor and

disadvantaged groups are incorporated


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Incorporation in ActionPlans Access Ecosystem

Market (and public) energy access

provision operates within a wider

ecosystem encompassing:

Policy

Financial Services

Capacity

Assessing the prevailing ecosystem

allows policy makers to:

Prioritize decentralized solutions which

fit well with the existing ecosystem

Identify measures facilitate delivery of

priority solutions to include in Action

Plans


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Incorporation in ActionPlans Access Ecosystem

Success Conditions for decentralized energy access differ from those forcentralized solution (and between different decentralized options):

=> Need to consider and prioritize specific decentralized solutions in Action Plans

Type of

Energy AccessPolicy Requirements Finance Requirements Capacity Requirements

Policy makers understanding of energy market regulation

Relatively small number of highly trained technical and business

staff to support large energy projects and operate plant

Local facilities for plant repair and maintenance

Business models for community level provision and toolkits for

use by providers

Significant numbers of developers with energy access technology

knowledge and business skills and technicians with skills to

operate and maintain plants

Local facilities for plant repair and maintenance

Readily available information on existing energy access, demand,

expenditure and availability of primary energy (to reduce

transaction costs)

Innovative payment platforms to ease end-user capital need and

reduce provide overheads

Local manufacture of goods and products

Consumer awareness of modern energy access benefits

Entrepreneurial distribution and marketing channels

Markets for servicing and repair developed alongside

manufacture and sales

End-user finance

Centralized

Policies and regulation on private

sector energy project development

and supply of energy to national

utility

Sophisticated facilities

providing large individual

tranches of finance to small

number of energy access

providers

Community

Level

Policies and regulations which

facilitate development and

operation of minigrids by private

sector companies and community

entities

Household/

Facility Level

& Appliances

Defined quality standards for

energy access products

Finance for early-stage project

development

Facilities accessible by small-

scale developers and

community entities, withrepayment backed by user

payments

Start-up finance for

entrepreneurs


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Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets


(and centralized)


financial/other

requirements, scale

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potential

Scale Programmes

Formulate Action

Plans & set Targets


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Moving from Projects to Scale

Programmes:

Real impact depends on delivery at scale

Decentralized energy access has already been delivered at

scale:

IFC Lighting Africa programmes

GACC/Improved Cookstoves Programmes

EU-funded Developing Energy Enterprises in East Africa

Requires ambition and commitment


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Establish

baseline for

Energy Access

extent and

levels

Review

Decentralized

Energy Access

Ecosystem

Participatory

Mapping of

Decentralized

Energy Access

Markets


(and centralized)


financial/other

requirements, scale

Identify priority

decentralized

solutions

Identify enabling

actions

Identify potentialScale Programmes

Formulate Action

Plans & set Targets


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Conclusions:

The combination of centralized and decentralized energy

access solutions will be different for each country but

some general conclusions may be drawn regarding the

factors to be considered in incorporating decentralized

options into the national Action Plan process:

Decentralized technologies provide the best energy

access option for many

Decentralized energy access solutions have different

characteristics and requirements. National Action Plans

should prioritize specific solutions so that the conditions

for success can be created for these priority solutions.


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Conclusions continued:

Much decentralized energy access will be delivered by

the private sector. Market mapping can provide a

means of understanding the conditions required for

healthy decentralized energy markets, and identifying

interventions needed to establish these conditions

Market mapping should involve the full range of market

actors, as well as those providing supporting services

and forming the enabling environment. This can

provide a valuable means for ensuring that all relevantstakeholders are engaged in the national Action Plan

development process


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Targets for decentralized energy access delivery which

encompass all aspects of Total Energy Access - energy

for productive uses and for community services, as well

as for household cooking and electricity - will ensure

the greatest overall benefits from improved energy

access are achieved.

Prioritization of decentralized options which offer Tier 2-

3 access will focus benefits on those at the bottom-of-

the pyramid and maximize benefits achievable withavailable resources. Meanwhile targets for specific

groups can contribute to reducing poverty; achieving

the MDGs; and reducing inequality.


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Higher energy access levels will require increases in

expenditure. Programmes aimed at these higher

access levels will therefore need to combine strategic

use of public money with pro-active initiatives to raise

user incomes.

If decentralized energy access provision is to achieve

its potential, solutions must be delivered strategically,

through scale programmes. Identification of such

programmes should form a key element of nationalAction Plans.


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Thank you

[email protected]

www.practicalaction.org/consulting

http://www.twitter.com/practicalactionhttp://www.flickr.com/photos/practicalactionhttp://www.facebook.com/practicalactionhttp://www.practicalaction.org.uk/blogshttp://www.youtube.com/practicalaction


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Role of Geo-spatial Mapping

From Rwanda Electricity Access Scale Up Program and Swap Development

Eng. Yussuf Uwamahoro


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Comparison of Cooking Options -

Economics

Moving from traditional to modern Tier 2-3 => cost savings

Efficient wood cookstoves, in particular, offer an economic

means of achieving Tier 2 or 3 (if wood sustainably

available)

Biogas provides an economic high level (Tier 4) cooking

energy solution where this is a practicable solution

Even Tier 4-5 cooking solutions are not substantially more

expensive than currently available, inefficient charcoal, coal

and kerosene stoves for urban residents


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Decentralized Energy Options

Electricity Mechanical Power

Minigrids powered by

hydro, wind, biomass,

solar or diesel

generation

Multi-function

platforms

HouseholdEnterprise

Facility

Level

Solar/wind home

systems, pico-hydro/

-biomass/-biodiesel

generators

Solar lanterns

wind/ bio-diesel/

hydro/ solar pumpsand mills;

treadle pumps;

Cooking & Heating

Community Level

Clean, efficient

cookstoves;

solar heaters;

solar/gas

refrigerators

Biogas systems

Appliances


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Accessing improved energy for cooking requires capitalinvestment improving affordability and access to finance

is a key enabler

Achieving improved access requires higher technology, and

hence higher capital investment, but there are variations

within that broad trend

Biogas systems in particular are relatively capital intensive

Comparison of Cooking Options

Capital Required


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Economics

Tier 1 electricity access can be achieved at a lower costthan existing solutions (ie than kerosene lamps)

Tiers 3+ require increased expenditure and so will rely on

increasing incomes and/or public funding if those at the

bottom of the pyramid are to achieve higher access

Decentralized solutions are highly competitive with

centralized solutions at lower access tiers but become

progressively less competitive at higher levels


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Capital Required

The general trend is of increasing capital for higher levels ofaccess, but theres also considerable variation within tiers

For lower tiers, decentralized solutions require significantly

less capital than grid extension

Even for higher access tiers some decentralized solutions

remain competitive in capital terms

Documents

A Decentralized Energy Access Strategy - Presentation