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The Future of African Energy Supply

Africa’s economic growth is exploding like never before. But due to a demographic change on the continent the power supply system is not capable of expanding at an adequate rate.

Today more than 600 million people don’t have any access to power on the African continent. These electricity struggles definitively constrain further economic development. The ones who don’t have power are usually poor and therefore don’t have a chance to change anything about it. This problem is majorly caused by a demographic transition, as the average has been lifespan expanding and birth rates have gotten higher. Like almost every other African country, Ghana’s electricity demand is growing faster than the production can assure. The former minister of power, Kwabena Donkor, stated in 2016 that the need capacity has been around 2,100 Megawatt. But only 1,500MW have been available since then.

Ever since gaining independence the Ghanaian government has been a pioneer in power generation. Nowadays the Nana Akufo-Addo administration has planned major projects to provide the required electricity demand. On one hand a coal power plant (Aboano power station) is being considered in cooperation with a Chinese energy company and on the other hand the biggest solar power station on the African continent (Nzema project) is being planned with the help of a British corporate electricity group.

Despite generating power by the biggest human made water supply dam, not even half of the needed capacity can be gained throughout Akosombo dam in the Volta region.

Also problematic is that Ghana is exporting that power to other African countries due to contracts that have been entered since the time of commencement. Further more than half of the thermal energy is facilitated by independent power producers and therefore not necessarily tethered to the Ghanaian grid. The government has to get a grip on its energy supply problems by all means.

 

How dirty is the solution?

One proposal by the Mahama administration was to install a huge coal power plant in the Ekumfi District of the Central region, which is planned to be be built near Ekumfi Aboano in a coastal area. The project is to be run as a Joint Venture in cooperation with the “Shenzhen Energy Group Co., Ltd. of China”. In two construction phases the electrical generating station is expected to contain a capability of 2100MW. Instead of the initially conceived US$ 700 million, the project is now estimated to cost more than US$1.5 billion, which will be granted by the China-African-Development-Fund.

Draft of the Aboano Power Station

Furthermore a proper industrial harbor has to be installed at the compound. The coal is expected to be imported from South Africa or Columbia.

At the moment the project is shelved due to concerns by the environment ministry. Minister Ayariga asserted in an interview with “Ghana Business News” that there will be no coal plant set up. He verified that there has been put an application, which has not been approved. In addition he ensured not to sign a permit for anyone to put up a coal plant as long as he is the Minister of Environment because Ghana has just ratified the Climate Change Agreement. Nevertheless the current minister of power Boakye Agyarko, who has been widely criticized for bribing, still plans to put the power plant into action by 2020. Criticism about the impact on global warming and especially the health of the local people has been rising and became a central part of the public debate on the fossil fueled power station.

Producing energy by burning fossil fuels is not sustainable. Also mining and drilling for fuels are causing chronical environmental damages. Heat produced from burning fossil fuels contributes to global warming and acid rain which is the greatest threat for upcoming generations and the future of our planet. Moreover the import of fossil fuels is very expensive due to high transport costs and questioning because of critical working conditions in the countries of depletion. Energy production from renewable sources is the only way to provide power in an ecologically and socially sustainable way.

 

Do renewable sources have a chance?

Another alternative project is located near Aiwiaso Village in the Nzema East District, Western Region of Ghana. The biggest solar power station of the African continent (4th worldwide) has been consented east of the border with Ivory Coast. It will use a total of 630,000 solar photo voltaic modules, which can at least power 100,000 homes when effectively fed in the national electricity grid. The construction is set to start at the end of 2017.

Draft of the Nzema Solar Power Station

In contrast to the Aboano power plant the Nzema project will be financed by capital of many different sources, e.g. equity partners, multilateral lenders, International financial institutions and own capital. The power plant is budgeted to cost approximately US$400 million. The 155MW electrical generating station will raise Ghana’s national power capacity by 6%.

The problem of power supply is not for long time yet solved. Besides there is not enough power produced, the grid to distribute the electricity is not good enough by half. Mostly rural areas have no chance of getting access to the mains supply in the near future. A deficiency of investors, who can finance the extension of the grid, and a shortage of people, who can permanently afford a power supply connection, are responsible for the failure of energy supply.

But maybe the comprehensive manner of industrialized countries is not transferable to the African way of life, as history proved many times. Certainly the African nations have to establish different, specific ways to rise to the challenge of independently liberating its people from the apparently never-ending misery that retards the socioeconomic development since the colonial era.

 

Solving central problems by decentralizing the approach

Off-grid-projects may be a sustainable approach. By producing the power directly where it is consumed, no significant extension of the grid would be needed to power marginalized regions. In most African peripheries electricity is only accessible throughout the use of diesel generators. Petroleum lamps are commonly used to light homes. Both fossil fuels are very expensive and health damaging. A German company is striving for a new way to bring power to the people and to arrange for autarchy to end the plutocracy in the energy sector.

Solar Container in Mourdiah, Mali

Africa Greentec is exporting containers including solar panels, LED lamps, WIFI routers, laptops and a basic power supply system. It is enough to provide energy for 60 to 80 households.

Throughout 20 years of use the consumers could save about US$400,000 in contrast to using Diesel generators while consuming the same amount of energy. The solar power station can be set up in only 20 minutes. The first containers were all installed in rural areas of Mali.

 

The visionary and his team

Torsten Schreiber, founder and CEO of Africa GreenTec , is one of Germany’s most successful entrepreneurs in the energy sector. In the 2016 Energy Awards “mobile solar containers for Africa” got awarded as the best start-up company by the famous German economic newspaper “Handelsblatt”. Solar Containers have been encouraged on a global basis, since the project is promising worthwhile return on investment and having a socially sustainable impact on the energy revolution.

The Team of Africa GreenTec

Africa GreenTec is led by a group of Investors and businessmen who lived up to their names as pioneers of the energy transition and sustainability. A crowd funding platform called “bettervest”, which was also founded by Torsten Schreiber and awarded several times, plays a big part in the success of the company. Next to a tradesman from the energy contracting business, an expert for risk analysis and Schreiber’s wife Aida, there are working about 25 other people, mostly students from Germany, who do not make demands on their wages. In addition to the German Company Africa Greentec, the Cameroonian employee Charlie Njonmou founded another company, called “Mobile Solar Power Plants Africa”, which is responsible for installing the containers on the ground. Torsten Schreiber describes his company as a “social business”, which aims to enhance chances for people in marginalized areas and not to maximize the profit of the investors. As the president of Mali saw the power plant for the first time, he acknowledged astonishingly that Schreiber really is a trustworthy man. The most important asset of Africa Greentec has always been their authenticity and credibility. Schreiber’s wife is from Mali as well and both do not only know the fears and needs of the African people very well, but also their dreams. For many years the German entrepreneur and his wife have been fighting for human rights and environment protection.

 

Trying to kill two birds with one stone

The first idea the German crowd funding expert came up with was not only dealing with the energy supply, but was also a proposal for solving the waste problem in most African countries. By installing central waste disposals and thermal power plants next to them, energy could be produced by burning the waste. But the implementing failed because of insufficient funds and disinterest of potential investors. To install a power plant of that format, at least US$7million would have been needed. Besides the expensive installation of the power station, a proper waste disposal service would have been required to efficiently achieve a sustainable effect.

The International Bank for Reconstruction and Development (World Bank) did not recognize so far that by financing these kinds of projects, the major issues of developing countries are dealt with. And as long as the states of Africa are not solvent enough, no one but private investors, such as multinational conglomerates, can approach those sustainable proposals.

 

Gaining power step by step

Even though the energy supply problems have a huge extent, progressive social businesses like Africa GreenTec have to plan step by step and keep their pants on.

Torsten Schreiber in Mourdiah

In 2017 the company is planning to issue a loan worth US$10million to finance 25 more solar containers. In addition to the five projects in Mali, Mobile Solar Power Plants Africa wants to install the off-grid solar power plants in Niger, Madagascar, Nigeria, Burkina Faso, D.R. Congo, Senegal and Ghana in the long term.  By the end of 2017 Africa GreenTec aims to supply more than 250,000 people in Mali with power. Furthermore the solar power stations are regularly updated. The new containers include LED-lamps, which use less energy than common light bulbs, Internet connection throughout WLAN-routers and water treatment plants. In cooperation with the initiative “Labdoo”, Torsten Schreiber is additionally providing local schools with 20-40 conditioned Laptops per site, containing educational software.

The huge amounts of financial development aids do not trickle down enough through the corrupt political elites of most African countries. So it is time to reconsider the strategy of how to better the lives of people seeking help. Everywhere in the world social problems emerge because people living in peripheries think they are left behind toothless by globalization and their ruling elite. Inequality of chances and social and economic inter-regional disparities are growing offside areas of high population density. Throughout the expansion of economic hotspots and gentrification the same issue is disturbing the urban population. Only an improvement of social and economic infrastructure can satisfy the needs and reduce the worries of marginalized people. Seeing that, the socioeconomic impact of off-grid projects like Africa GreenTec is presumably more valuable to the African people than financial support of their political plutocracy or huge externally controlled offshore investments to maximize the profits of foreign beneficiaries of globalization.

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