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September 24, 2018

Powering The Economy Through Sustainable Energy For All

let there be light: Machakos Governor Alfred Mutua and DP William Ruto look on as President Uhuru Kenyatta commissions the Last Mile Connectivity project at Katulu S.A. Primary School, Tala in Machakos county on May 27.
let there be light: Machakos Governor Alfred Mutua and DP William Ruto look on as President Uhuru Kenyatta commissions the Last Mile Connectivity project at Katulu S.A. Primary School, Tala in Machakos county on May 27.

Of all the 17 Sustainable Development Goals, goal seven which strives to “ensure access to affordable, reliable, sustainable and modern energy for all” by year 2030 is perhaps the most pragmatic. This is one of the goals that was not in the Millennium Development Goals that paved way to the SDGs.

The goal follows the declaration of 2012 the “International Year of Sustainable Energy for All” by the UN. To sustain the momentum, it was followed by the announcement of 2014 to 2024 as the “Decade of Sustainable Energy for All” and the launch of the Sustainable Energy for All, SE4ALL initiative. 

The energy goal encompasses three objectives whose aims are to ensure universal access to modern energy services - including electricity and clean, modern cooking solutions, to double the global rate of improvement in energy efficiency and to double the share of renewable energy in the global energy mix.

Access to affordable energy is more or less a proxy for development, with the path to development catalysed by energy. It is therefore not a surprise that the 20 largest energy consumers account for 80 per cent of the primary energy consumption. China and the United States are the two largest consumers accounting for 40 per cent of the total. 

The second objective of doubling the global rate of improvement in energy efficiency will therefore be largely dependent on these 20 countries.

The global challenge of meeting the three objectives will require bold policy measures, combined with a regulatory environment that supports innovation and encourages investments in the sector.

Global statistics on energy show that while 83 per cent of the world has electricity, an estimated 1.2 billion people live without electricity of which 51 per cent are concentrated in sub-Saharan Africa. In fact in some sub-Saharan countries, Kenya included, many people in rural areas have never seen electric light, leave alone imagining that they can use electricity power! For such people, they only hear stories that in the towns, you touch something in the wall and the room lights up and may associate this with witchcraft or magic!

 When it comes to cooking, 59 per cent of the world uses non-solid fuel while 2.8 billion people primarily rely on solid fuels with 25 per cent of them concentrated in sub-Saharan Africa.

In fact, among the 20 countries with the lowest access to electricity, 12 of them are in SSA.  More significantly however, it is only in SSA where the rate of progress on energy access was below the population growth between 1990 to 2010.  Ethiopia, South Africa and Nigeria are the only three countries in SSA that make the list of the top twenty with the greatest annual increases in access to electricity during this the period although others in the wider Africa include Egypt and Morocco. 

Needless to say, if the trends observed in the last two decades continue, particularly in SSA, the universal access objective in the SDG would not be met. 

According to the International Energy Agency the achievement of universal access will require an average annual investment of $45 million, up-scaled from $9 million estimates of 1990. Of this amount, more than 60 per cent would have to be invested in SSA, with developing Asia taking another 30 per cent. The universal access to modern cooking solutions would require a global investment of $4.4 million, most of it in sub-Saharan Africa.

That said, the potential is immense and the challenge remains how to capture and utilise it in a cost effective manner. Most developing countries are located along the solar belt, with great solar energy potential. At least 75 per cent of the worlds unexploited potential in hydropower is located Africa, Asia, and South America; regions that need it most. 

Local statistics show marked improvement in access to energy with the total population having electricity in Kenya increasing from 11 per cent to 23 per cent in the two decades from 1990 to 2010. This is however 60 per cent below the global average of 83 per cent. By 2010, 71 per cent of the urban population and eight per cent of the rural population had access to electricity. Besides, while the urban access may appear impressive, its reliability for industry and affordability are barriers to its ability to power the economy.  Standby generators are a standard norm for many industries to weather the frequent power outages, significantly affecting the cost of production. 

 That the country is not among the fasted growing in terms energy access means much more could be done. For many people, it is time to translate the chapters on policies, promises, TV and newspaper advertisements and towering billboards to kilowatt hours for real people. 

 Several barriers stand in the way of access to electrification. Having a realistic energy access strategy that is mainstreamed into the nation’s overall development and budget process will be important. A high level of commitment from the political leadership is equally important. Also important is a robust financial sector that can provide financing at affordable rates and a legal and regulatory framework that encourages investment. 

Some countries made the hard decisions of lowering energy costs through innovative solutions with the objective of ensuring low productions costs so as to penetrate the international markets. These countries have made significant progress and their products now have sizeable markets in the global arena. It is possible for Kenya to prioritise energy and actively encourage investment in innovative solutions that will not only accelerate the uptake of power but make it cost effective. If the Jua Kali metal fabricator can access power at lower cost, then he can sell the metal door at lower cost. If this is replicated in the product destined for exports, the final products will be more competitive and soon we shall be seeing Made in Kenya more common in the global markets.

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