A rising Africa is hungry for electricity. Unreliable supply negatively affects business and represents a major risk for international investors. The South African case of “load shedding” is a case in point. What are Africa’s electricity challenges and what solutions are found in the realms infrastructure asset management?
Images of Africa in the global imagination are changing. A once “dark continent” plagued by underdevelopment, corruption and intra-national conflicts has become the new frontier of development. Across the continent:
Financial markets are becoming digitised
Countries are experiencing high sustained growth rates
There is a growing middle class
A burgeoning tech sector
A stabilisation of democraciesAfrica has the youngest and most rapidly growing population globally, with almost 200 million people ages 15 to 24. By 2040, the continent’s population is estimated to represent 40% of the world’s population. While opportunities abound for African countries to harness the advantages of population growth, technological innovation, and the dynamism of a young growing middle class, African countries need to ensure a stable economic environment that enables job creation and promotes business opportunities.
AFRICA HUNGERS FOR ELECTRICITY
Electricity is a secondary energy resource obtained from the conversion of the primary energy resources such as fossil fuels (natural gas, oil, coal) and wind energy. Electricity is essential for achieving development goals, as basic economic activity depends on a steady supply of energy. According to McKinsey & Co’s 2015 report, Powering Africa, 600 million people in sub-Saharan Africa lack access to electricity. Only seven countries—Cameroon, Côte d’Ivoire, Gabon, Ghana, Namibia, Senegal and South Africa—have electricity access rates exceeding 50%. The rest of the region has an average grid access rate of just 20%. In 2016, Afrobarometer found that access to electricity in Africa had slowly increased by 14%, but that this still leaves just 64% of Africa’s population living in areas where they are connected to grid power.
As Powering Africa’s authors maintain, “even when there is access to electricity, there may not be enough to go around. The correlation between economic development and energy supply may be up for academic debate, however, the centrality afforded to energy in the Sustainable Development Goals (SDG) attests to its importance as an enabling factor for human security and development. Access to electricity promises to expand the number and variety of business and job opportunities available, while a lack of a consistent access to reliable power costs businesses and the economy as a whole. Power allows business owners and employees to increase working hours and provides business owners with access to online information and resources.
UNRELIABLE SUPPLY EQUALS LOSS
Electricity is critical when looking at barriers to business opportunities and job growth in sub-Saharan African countries. According to the advocacy group, ONE.org: “…. nearly 7 out of 10 businesses cite lack of access to a reliable source of power as a main constraint to doing business, before access to finance and corruption.
As a whole, the general challenges akin to infrastructure investment such as aging infrastructure, skills gaps, maintenance backlogs, theft, and corruption will continue to plague the African economic future.
As depicted in the infographic below, the economic impact of “load shedding” in South Africa between 2014 and 2015 resulted in crippling financial losses, with negative economic implications.
AILING INFRASTRUCTURE IS THE KEY CHALLENGE
While load shedding has been the cause of recent power blackouts, says EE Publishers’ MD, Chris Yelland, non-load-shedding outages are caused by infrastructure-related issues:
Lack of distribution network maintenance
Overloading the system due to cable theft
According to another commentator, Melusi Maposa, MD of resources at Accenture Management Consulting, the real problem for most of these issues is the inadequate investment in distribution maintenance and refurbishment. The challenge he says is not load-shedding, but infrastructure management: “if the lights went out in the past 12 months, then it was a distribution failure, not load shedding”. Maposa’s conclusion is that responsible authorities, such as the Department of Energy, electricity utility Eskom, and city and town councils, must find ways to fast-track infrastructure rehabilitation and new installation.
ELECTRICITY INFRASTRUCTURE MANAGEMENT
As can be seen, reliable electricity supply is dependent on effective infrastructure maintenance and management. Infrastructure management in turn relies on good information management.
By maintaining a complete, up-to-date inventory of all assets in an electricity distribution network, with accurate information on the expected- and useful-lives of assets, authorities (such as municipalities) can better plan capital and operational expenditure, optimise available resources, as well as maintenance and operations.
Geographically referenced information management systems, such as IMQS’s Web Platform, offer municipalities the ability to equip the right people with the right information to make informed, strategic decisions. Specialised infrastructure-asset-specific software can work with the above digital and spatially enabled Asset Register to improve maintenance and electricity demand management.
For example, the IMQS Electricity Demand Management Information System Module (ELIFT) allows users to access a multitude of electricity related information in report, graph or map format, thereby making data visual. Spatial integration of data allows for a better understanding of the distribution and location of various factors pertaining to electricity assets, as well as consumption within municipal boundaries. Infrastructure-specific software can assist municipalities in evolving from struggling, reactive organisations to informed, proactive managers.
For more information on IMQS ELIFT package see our infographic or contact us today for a consultation.