For a man who has only
recently started his job, international development minister Nick Hurd seems
sure of his priorities.
“Energy Africa makes
perfect sense to me,” he says. “In the next few weeks and months we’re going to
be shaping what DfID [the Department for International Development] does in the
next five, arguably 10 years. But improving access to energy in Africa is my particular focus at the moment.”
After spending four years
as minister for civil society under the coalition government, Hurd has been
parachuted into the job at DfID to replace Grant Shapps, who resigned in the
midst of allegations that bullying in the Tory party had led to the
death of one of its activists.
Although his new portfolio covers a range of issues including
water, climate change, sanitation, education and health, his immediate priority
is to “keep up the momentum” of the Energy Africa campaign launched
by Shapps in October.
Hurd has his sights set
on the seventh sustainable development goal: universal access to affordable,
reliable and modern energy services by 2030. But sub-Saharan Africa is
currently 50 years behind, the only region in the world where the number of people denied
access to modern forms of energy is set to rise and, based on current trends,
predicted to hit the goal by 2080.
Inspired by Barack
Obama’s flagship Power Africa programme,
Hurd hopes that Energy Africa can make a key difference. Last month the US and
UK projects came together to create a new partnership to
address specific issues such as the need for shared power across borders,
resources for geothermal power, and to boost the number of women participating
in Africa’s solar industry.
But unlike Power Africa,
which has been catalysing a wide range of renewable energy projects that will
connect to the national grid – from a vast solar farm in Rwanda to the
first wind power project in Senegal – Energy Africa has a very specific
objective: to accelerate off-grid solar power for households using private
investment.
Grid investment will only
reach 40% of the population and leave more than 500 million people still
without electricity access in 2030,according to the Overseas Development Institute. Critics say that the
impact of DfID’s campaign will be only “incremental” because the continent
needs large-scale infrastructure and while NGOs push decentralisation, Africans
want a grid connection.
But it is well known that these incremental changes can
create significant new possibilities in the lives of individuals and
communities, from lanterns that enable pupils to study at night, to mobile
phone chargers, to lights for huts that keep animals safe from predators.
Hurd is adamant about the
need and value of off-grid investment. “The question is: what can we do for the
60% now?” he asks. “It strikes a chord with ministers wrestling with energy
access in their countries. On-grid is massively important but most of the
projections suggest that’s going to take a long time and won’t reach all the
population. That’s why Energy Africa is focused on household solar energy. We think there is
huge potential in off-grid particularly, because we see this market developing
which we think we, with partners, can turbo charge.”
A host of factors have
coalesced to create what Hurd describes as a “pivotal moment” for household
solar in Africa. In the past six years, the price of panels has dropped by around 70%, making it as
cheap as fossil fuels in some areas. The price and quality of battery technologies is also improving fast while the spread of mobile money systems on the continent is making solar an increasingly feasible prospect for
the individual householder.
Six countries have signed
up to DfID’s Energy Africa campaign. Ministers from Nigeria, Sierra Leone and
Somalia were the first to complete an agreement, followed by Ghana, Malawi and
Rwanda. Eight other countries have been identified as potential targets,
including Zimbabwe, Ethiopia and Uganda.
The countries were chosen
because they were “biting our hand off” says Hurd. “We are responding to
demand.”
Working in fragile states
is one of DfID’s explicit objectives, partly driven by national security
interests. More than half its budget is committed to work in such regions, but
implementing clean energy is a challenge in states grappling with terrorism and
conflict, such as Nigeria and Somalia.
Problems vary from
country to country, but the industry has been held back by a lack of legal and
tax structures. The International Finance Corporation is currently working to
establish a new set of product standards. DfID say it is its role to
work out how to streamline the bureaucracy, and the specific challenges in each
country are still being identified.
It’s a different model. It’s not about a huge chunk of public
money. It’s a private-sector solution to this challenge
Nick
Hurd
Providing electricity at
the household level comes with additional challenges. For rural communities
miles from a grid connection, energy poverty is entrenched by lack of access to
financial systems. Pay-as-you-go schemes offered by mobile phones are changing
this, but penetration fluctuates from country to country. DfID hopes that the
campaign will be able to support non-bank financial providers to create mobile
payment systems. In places where regulation makes it unfeasible, alternatives such as scratch cards will
make up the difference.
The campaign is not a
“traditional aid programme” says Hurd. Its aim is to galvanise private
investment in countries where DfID has formed a partnership with the
government. “It’s a different model,” he says. “It’s not about a huge chunk of
public money; it’s not a DfID programme as such. It’s a private-sector solution
to this challenge.”
But in a debate where
creating clean energy is often pitted against economic development, it does not
yet seem to be clear how foreign investment galvanised by the campaign will
provide substantial jobs for Africans on the ground.
Although DfID has
previously given seed funding to mobile money solar companies in the UK and
Africa – such as Azuri Technologies and Persistent
Energy Ghana – the
majority of investors involved in the campaign will be foreign, with many
British companies involved.
“We’re not nationalistic
about this. We know it’s going to be private-sector led and we want to support
entrepreneurs. At the moment most of the businesses are foreign, but over time
my hope and expectation is that this will evolve. There is a hell of a lot
going on in trying to increase energy access in Africa. My overriding instinct
is to keep asking the question: how does this join up?”
