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Access
to energy services are crucial to human well-being and to inclusive economic
growth; and yet according to the International Energy Agency and World Bank
(2017) as of 2014 about 1.06 billion people do not have access to electricity globally;
with about 609 million people based in sub-Saharan Africa.

Reliable
electricity is one of the main challenges facing the sub-Saharan region with
only a current installed capacity of about 70GW, of which more than 17GW is unavailable
due to poor infrastructure and maintenance. It is estimated that the short term
need for power in the region is 140GW and that to reach the Sustainable
Development Goal 7 set for 2030, an investment of between USD120 billion and
USD160 billion per year is required (KPMG, 2016). But according to the State of
Energy Access Report 2017 by the World Bank, despite the progress made so far, faster
progress is needed to reach the universal electricity access goal by 2030. 503
million people will still not have access to electricity by 2040 even if an
estimated 1 billion people may gain electricity access by 2040 (World Bank,
2017). Between 2012 and 2014 the sub-Sahara African population grew by 25
million but 19 million people gained access to electricity (GOGLA, 2017).

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From
heavily relying on a single finite energy source to generate power, there has
been a shift from certain sub-Saharan African countries diversifying their
energy generation mix by adding renewable energy technologies. South Africa for
example has introduced the Renewable Energy Independent Power Producer
Procurement Program. While they may not provide baseload power, they are
increasing grid-electrification access with a focus on urban areas due to the
high costs of supply to rural and remote areas and the inability of low income
households to pay high connection charges.

The
solar revolution with solar home systems or pico-solar products is raging in sub-Saharan
Africa, especially in East Africa as most manufacturers have their headquarters
and expansions there . Between January and June 2017, 1.77 million units were
sold for a value of USD40.67 million by Global Off-Grid Lighting Association member
companies and companies selling Lighting Global quality verified products. 69%
of the sales come from East Africa (GOGLA, 2017).

Central
Africa has the lowest electrification rate of the sub-Saharan Africa and a
population of 166 million compared to East Africa’s 428 million. Compared to
other sub-regions, countries of Central Africa engage in minimal power trading
with the general transmission and distribution infrastructure severely lacking
and inefficiently set up. The use of smart technologies is also behind that of
the other regions and low collection rates are common leading to insufficient
funds being generated causing insufficient maintenance and preventing future
power infrastructure expansion. Yet, out of the 1.77 million, only 77000 units
were sold in Central Africa (46000 in the Democratic Republic of Congo and
31000 in Cameroon).

With
pico-solar products and solar home systems gaining ground in sub-Saharan Africa
with the roll-out of the pay-as-you-go (PAYG) technology addressing both end customer affordability and
providing sufficient margins to fuel operational models that can scale, why are
companies not expanding in Central Africa?

The
aim of this research is to investigate the market potential of PAYG for the
central African region using East Africa as a benchmark.

The
objectives of the research are:

·        
to compare the two regions’ top
performing countries at a macro-economic level

·        
to compare the policy,
planning and regulatory approaches around off-grid energy access

·        
to investigate the perception
organizations dealing with off-grid energy access on a household level have on
doing business in Central Africa.

·        
to learn about the market from
companies already operating in Central Africa

http://www.iea.org/topics/energypoverty/

http://documents.worldbank.org/curated/en/364571494517675149/pdf/114841-REVISED-JUNE12-FINAL-SEAR-web-REV-optimized.pdf

https://assets.kpmg.com/content/dam/kpmg/pdf/2016/05/kpmg-sub-saharan-africa-power-outlook.pdf

https://www.gogla.org/

https://www.gogla.org/sites/default/files/resource_docs/gogla_sales-and-impact-reporth12017_def.pdf

https://www.gogla.org/sites/default/files/resource_docs/2017_seforall_fr4_policypaper.pdf

 

 

 

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