Energy poverty

There are some 1 billion people in the world without electricity.  If you have access to electricity, you take it for granted.  A press of a switch, and there's light, or warmth, or access to the outside world via phone or internet.  If you look at poor countries round the world, they correlate well with energy poverty.  The revolution that electricity has brought since the late 1880s is taken for granted by people in developed countries, yet it is perhaps one of the greatest inventions ever, and changed the world dramatically.  So closely were electricity output and industrial production intertwined that up until recently, growth in electricity production/demand was an excellent indicator of growth in overall industrial production.  And that close relationship between economic growth and electricity demand has only ended in recent years in developed countries because of the invention of things like LED light bulbs and more efficient white goods.

Bringing electricity to developing countries is complicated.  It's not just a question of building new power stations but also of building out the grid.  And those mammoth projects have to be funded.  We in developed countries take the grid for granted.  It's there, with wires on the street.  But it took decades to build out, and it costs.  A lot. 

In the wake of the Sustainable Development Goal conference underway this week at UN headquarters in New York, Bloomberg NEF has released an analysis on the potential for off-grid solar PV to meet clean energy demands of the estimated 1 billion people currently living without access to electricity.

According to the analysis there are five key factors that indicate off-grid solar PV is going to play a pivotal role in providing universal energy supply.

Chief among these factors is the cost of power grid expansion. The analysis stipulates that it could range between $266 and $2100 per household to establish a connection. In high-income areas, this is less of a problem, as households are equipped to pay additional energy prices. Additionally, energy prices would climb higher in low-income areas, as the grid operators have to amortize the installation with modest energy consumption.

Bloomberg NEF calculates that energy from solar home systems costs around $1.5/kWh and if sourced from microgrids would be $0.29-0.77/kWh. The report goes on to claim that the costs of electricity after a new connection would be $1/kWh, hence higher than the costs of energy if a microgrid is deployed.

[Read more here]

Micro-grids make a huge difference to economic output and productivity:

At a UN High-Level Forum on Sustainable Development Goals, global off-grid solar association, Gogla, released a new report evaluating the economic impacts of off-grid solar systems in East-Africa. The report, sourcing data from 2,300 households, indicates that the deployment of solar systems in the region has had a significant impact on the respondents’ lives.

The data shows that 58% of the households, which had recently installed an off-grid solar system, worked more or developed their enterprises, due to the availability of electricity. Additionally, 36% of the households reportedly ramped up their average income by an additional US$35 per month. In the region in question, this is equivalent to 50% of the average monthly GDP of a household.

Furthermore, because of electric lighting, the respondents reported that they could spend 44% more time at work or on chores. Previously, nightfall had prematurely interrupted these activities. This improvement generates income for the households and increases the economic activity of business owners, the report says.

With the possibilities of using technologies like smartphones more, 11% of the respondents reported that they had started a new business following electrification from off-grid solar systems. In 7% of the households, at least one member of the household reported having received a new job as a result of the solar energy deployment.

The report surveyed 2,300 people from Kenya, Mozambique, Rwanda, Tanzania, and Uganda. A range of companies delivered small-scale pay-as-you-go solar systems, which comprised a solar panel, battery, LED lighting and potentially other devices, depending on customer needs.

[Read more here]

The coal-loving Right argues that the best way to get rid of energy poverty is to build massive coal-fired power stations in developing countries.  Nope.  Aside from the fact that coal power stations need prodigious quantities of water, and produce pollution, they and the extensive national grids they require are too costly.  The best way to get electricity to poor communities in Africa, Asia and elsewhere is to build out tens of thousands of solar-powered micro-grids, in every village which is currently unconnected to an outside grid.  Our best foreign aid would be to fund such micro-grids, not giant projects like dams and power stations.  The good news is that poor countries tend to be located in places where insolation is the greatest.  This makes them perfectly suited to solar grids.

A micro-grid solar installation in Olturoto, Kenya.  Source: PV Magazine