Nana Amoasi VII’s thoughts … Ghana must deploy the renewables to achieve universal electricity access by 2025, after failing at 2020 target

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Globally, access to substantial quantity and quality energy infrastructures have been found as essential to rapid and sustainable socio-economic development. According to the International Energy Agency (IEA), modern energy services, particularly, electricity and gas have an effect on productivity, health, education, safe water, and communication services. Ahali (2015) finds the extensive use of electric powered machinery as playing major roles in both industrial and household production.

Indeed without electricity, economic transformation through improved productivity in manufacturing and services, technological innovations, and promotion of value-addition in resource-based economies would not be possible.  Insufficient supply of energy will limit socio-economic activities, restrict economic growth, negatively impact living standards, and aggravate poverty and inequality, and also hampers government revenues (Ahali 2015; Oseni 2012; IEA 2014).

It goes to suggest that the need for electricity is critical, as it is a catalyst for sustainable economic development. That it is impossible for a country to develop and sustain beyond subsistence means without having access to electricity for the greater portion of its society. Economic sectors such as agriculture, transportation, mining, services, and industries cannot do without electricity, as it presents itself as a vital commodity.

In spite of its vital role, a billion people mostly concentrated in Sub-Saharan Africa and Asia still live their daily lives without electricity, and hundreds of millions more live with unreliable or expensive power (IEA 2019; Mobisol 2018).

Global Electricity Access

The International Energy Agency (IEA) reports that global efforts to deepen the access to electricity access across the globe are showing positive signs in all regions, and the pace of progress has accelerated over the past few years. That for the first time in 2016, the population not having access to electricity had fallen below the 1.1 billion mark.

In its latest report, the IEA suggests that the number of people without access to electricity has dropped from close to 1 billion in 2017 to 860 million; a record in recent years. Most of the progress made were in developing Asia, where 800 million people representing 80 percent of the total 860 million have gained access since 2010. IEA’s latest analysis of Asia Energy Outlook 2019 revealed that close to 1 billion people have gained electricity access in developing Asia since 2000 with 94 percent of the region having access to electricity in 2018 compared with 67 percent in 2000. India accounts for nearly two-thirds of this progress as it continues to make unprecedented progress towards universal access.

The analysis of Africa Energy Outlook 2019 shows that in Africa the number of people gaining access to electricity doubled from 9 million a year between 2000 and 2013 to 20 million people between 2014 and 2018, outpacing population growth. As a result, the number of people without electricity access which peaked at 610 million in 2013, declined slowly to roughly 595 million in 2018. Much of this recent dynamism has been in East Africa, as Kenya, Ethiopia, and Tanzania accounted for more than 50 percent of those gaining access. The majority of the progress over the past decade in Africa has been made as a result of grid connections, but the rapid rise has been seen in access via solar home systems. Kenya, Tanzania and Ethiopia accounted for around 50 percent of the 5 million people gaining access through new solar home systems, according to IEA’s latest estimation in 2018.

Source: IES Construct, Data from the Energy Commission

In spite of the strides made, IEA suggests that sub-Saharan Africa’s electrification of 45 percent in 2018 remain very low compared to other parts of the world. The million people still without access to electricity there represents more than two-thirds of the global total. And about half of the sub-Saharan African population without electricity access can be found in Uganda, Nigeria, Democratic Republic of Congo, Tanzania, and Ethiopia.

Of those without access to electric energy in sub-Saharan Africa, West Africa is reported to accounts for 30 percent. Putting the average access rate across West Africa at 52 percent, with Ghana being one of the most successful countries in the sub-region in expanding access. Data from the IEA has it that in 2016 only 8 countries were listed as having an access rate above 80 percent – Gabon, Mauritius, Reunion, Seychelles, Swaziland, South Africa, Cape Verde and Ghana; while most countries had a rate below 50 percent and some had a rate of below 25 percent.

Electricity Access Rate in Ghana

Becoming fully aware of the key role of electricity to an economy, Ghana in 1989 devoted itself to a 30-year National Electrification Scheme (NES) to achieve universal access to reliable electricity supply by 2020. The objective according to Ahali (2016) was driven by growth in demographic requirements, increased urbanization with an ever increasing technological demand, and the aspiration to transform into a middle-income country.

31 years after the policy was instituted, there still exist a substantial deficit in electricity access in Ghana. Current electrification rate is about 85 percent, a bit far off the target, with no improvement in sight. The baseline at the time the policy was rolled showed national electricity access of about 25 percent, with only 5 percent rural penetration. Data from the Energy Commission of Ghana showed that at end 2000 electricity access rate stood at 45 percent, suggesting an annual growth rate of approximately 2 percent. The next decade ending 2010 revealed that the country had achieved an access rate of 67 percent; indicating an annual growth rate of 2.2 percent. Also the annual growth rate between the next 6 years that followed (2010 and 2016) as recorded by the Energy Commission was 2.7 percent. The trajectory therefore shows an incremental annual growth in electricity access.

However over the last 3 years (between 2016 and 2019) the annual electricity access growth rate has seen a substantial decline, from 2.7 percent to a paltry 0.6 percent. As at the end of 2019 the country had obtained a national electricity access rate of 85 percent. If the country had maintained just the annual rate of roughly 2.7 percent, electricity access rate would have been somewhere around 92 percent today; comparable to other countries outside the sub-Saharan African and Asian band.

It is evidently clear that with the current growth rate it is practically impossible to achieve universal access by end 2020. And the admission of this fact is what has led the Government of Ghana revising its target, and seeking to develop new strategies to push the boundaries to achieve the goal of universal access by year 2025.

 Ceasing the 2025 Opportunity

To be able to achieve a universal electricity access by the new set year 2025, Ghana may be required to work hard to grow the annual access rate by at least 3 percent, and in tandem with growth in demographic requirements, increased urbanization with an ever increasing technological demand, increase in economic growth, and increase in development and industrial activities; which are consistently placing a high demand for electricity in Ghana.

After continuously increasing power generation capacity from largely thermal sources, and increasing electricity access through grid expansions, it is now time for Ghana to be religious on its policy goal of 100 percent national electricity using renewable energy as a catalyst.

Deployment of renewable energy to achieve universal electricity access in Ghana is of course vital in the sense that a considerable proportion of the communities awaiting connection to the national electricity grid are currently difficult to access due to the fact that they are lakeside communities, with others planted on islands that require connection by sub-marine cables. Hagan (2015) suggest that for most of these communities, extension of the grid network would be challenging due to geographical and financial constraints, and off-grid and mini-grid options may be the technology of choice for meeting their electricity needs.

It has already been part of the country’s plan to develop and deploy renewable energy (RE) and energy efficiency technologies to achieve a 10 percent penetration of national electricity production by 2020. It is for this reason that in 2011 the Renewable Energy Act was enacted to provide for the development, management, utilization, sustainability and adequate supply of renewable energy for the generation of heat and power, and thereby increase the proportion of renewable energy in the national energy supply mix while contributing to the mitigation of climate change.

Energy Commission’s data shows that at end 2019 Ghana had only 1 percent penetration rate of electricity from renewable energy sources in its total generation mix. It is therefore evident that the country failed to meet it initial target of universal electricity access by 2020 because it also failed to meet its 10 percent deployment of renewable energy by 2020.

The International Energy Agency (IEA) has found that decentralized solutions are the least-cost way to provide power to more than half of the world population estimated to gain access by 2030. It has identified renewable energy sources as the least expensive modes to achieve universal electricity access in many parts of the world. In addition to increasing grid-connected electricity generation from renewables, declining costs of small scale solar photovoltaic (PV) for stand-alone systems and mini-grids is vital in helping deliver affordable electricity access to millions. This according to the body, is especially the case in remote rural areas in African countries, home to many of the population still deprived of electricity access.

 

Written by Nana Amoasi VII, Institute for Energy Security (IES) ©2019

Email: [email protected]

The writer has over 23 years of experience in the technical and management areas of Oil and Gas Management, Banking and Finance, and Mechanical Engineering; working in both the Gold Mining and Oil sector. He is currently working as an Oil Trader, Consultant, and Policy Analyst in the global energy sector. He serves as a resource to many global energy research firms, including Argus Media and CNBC Africa

 

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