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Africa needs different approach to energy resource management

Africa needs different approach to energy resource management

In Africa, every country has to have a diversified energy resource mix and South Africa is well equipped to effectively manage sophisticated energy technologies, including the ability to handle nuclear power resource.

This is according to Lazarus Angbazo, CEO of Energy Connections Business, GE, Sub-Saharan Africa, who spoke to ITWeb Africa on the sidelines of the three-day African Utility Week conference hosted in Cape Town from 16 May 2017.

Companies from several sectors, including utilities and technology, have gathered in South Africa's 'mother city' to discuss energy resource management, advances in technology to reinforce utility management and other issues, including management of service providers.

Angbazo echoes the common theme that power remains Africa's biggest problem and priority, and the continent's economic development will continue to be constrained until a solution is found.

"Everything hangs on the grid... within the power value chain, the biggest constraint to optimising the capacity and the investments that Africa has already made is in the transmission and distribution infrastructure. Many countries have an over-supply of installed generation capacity, but what is truly available is significantly lower than what is actually in demand today," says Angbazo.

Despite the clear investment in generation capacity, including installed generation capacity that is stranded, available supply and demand are not in balance, says Angbazo.

He says 600 million people in Africa do not have any access at all to power, and 25% of what is generated and promised never gets delivered because of the instability of the infrastructure.

He believes stakeholders must address the issue of power as a whole to unlock Africa's economic potential, and that in order to quickly deliver on this promise, there must be an emphasis on grid infrastructure.

And to do this, Africa needs a more holistic approach to the power value chain. Up till now, there has been an intense focus on power generation with the belief that once this is established, it will address most of the requirements in terms of development.

"So there is a misunderstanding that the moment you buy the turbines, you automatically get the power... that is not the case. You buy the power, you still need to build the infrastructure, get it into the grid and deliver the power to the users, get it into the distribution network and take it to the last mile"

Governments need to partner with investors and create an enabling environment conducive to participation in the transmission sector, because that is the segment of the value chain that is still largely government controlled.

"We are not arguing for a privatisation or a divestiture of the grid, we are basically saying government should partner more with investors, generation companies, distribution companies to provide the right amount of investments in the grid to ensure that the generated power is actually delivered power," says Angbazo.

Renewable energy

While governments across the continent continue to focus on establishing a mix of energy resources, with an emphasis on renewable power, one of the emerging challenges is how to integrate increasing renewable energy into the conventional grid.

Angbazo adds that financing, incorporating capital outlay and the capacity to define and structure projects so that these are bankable, is also a key consideration.

That is one of the focal areas for Nigeria, Africa's most populous country, which is rich in gas and coal, to capitalise on solar, hydro-power resources. The West African country is concentrating on utilising these resources to execute a balanced energy strategy.

The division that Angbazo heads up, GE Energy Connections, is focused on helping to address these challenges. He remains encouraged by the level of cooperation between government decision makers.

"This is a sector that requires active collaboration between the public and private sectors, for government reforms to attract investment, job creation and skills transfer."

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