More Africans have electricity, but they are using less of it

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TOURISTS have long been drawn to Hell’s Gate National Park in Kenya by its steep cliffs, plentiful zebras and spectacular canyons. Recently there is a new attraction; a spa set amid the cliffs, with a huge pool heated by the energy stored in the Earth’s crust. Curiously, it is not run by a tourist company, but by KenGen, the national electricity generator. It abuts the Olkaria geothermal power plants, from which plumes of steam pour into the sky. Since 1982 four power stations have opened here; a fifth is being built and work on a sixth will begin soon. Energy harvested from volcanic heat now provides almost half the power Kenya needs.

Electrification has been one of the country’s great successes over the past few decades. It is not just new generators; the number of people connected to the power network has also soared. According to the Kenya Power and Lighting Company (KPLC), nearly three-quarters of Kenyans are now connected, up from barely a quarter in 2013. The trend in many African countries has been in the same direction. According to the World Bank, the proportion of Africans with access to electricity increased from 19% in 1991 to 37% in 2014.

Yet this achievement is not quite as impressive as it sounds. More people than ever may be connected to electricity, but they are not using it much. In 2014 each African consumed, on average, just 483 kilowatt hours (kWh). That is less than in the 1980s. Americans, for comparison, used almost 13,000kWh each. In Kenya electricity use per person rose by just 10% between 2010 and 2014, even as the number of people connected more than doubled.

Some greens may hail such frugality. They should not: the alternative to electricity is often filthy, dangerous charcoal stoves and kerosene lamps. Besides, if utilities are unable to sell enough electricity to cover their costs then they cannot invest in maintaining or modernising their grids.

The weakness of demand is, on the face of it, somewhat puzzling. Sub-Saharan Africa, with a billion people, generates less electricity than South Korea. Nigeria, the region’s most populous country, produces less than half as much as Romania despite having almost ten times more people. This had long been assumed to be because of weak supply. All over Africa, rich residents of big cities keep generators fuelled with diesel and large firms build their own power stations alongside new factories. A lack of electricity is widely thought to be one of the main obstacles to economic growth.

Yet producing more power does little if people are unwilling or unable to pay for it. Earlier this year officials at KPLC said that almost 1m customers who are connected to the grid have bought no power at all.

In much of Africa the problem stems from botched regulations and weak states. In Tanzania private firms have invested in gas-fired power plants but Tanesco, the government utility, refuses to pay them for the electricity it distributes. In Nigeria, though the grid is fully privatised, electricity prices are kept artificially low by the regulator. So distribution companies refuse to buy power from the generating companies, complaining that they would make a loss selling it on. And customers rarely pay, since the supply is so erratic. Elsewhere, as in the slums of Nairobi, people connect themselves to the grid through illegal hookups.

Some well-intended policies may also be inadvertently hampering electrification. Among these, says Emma Gordon of Verisk Maplecroft, a British consultancy, is the extension of electricity grids to poor rural areas. Bringing electricity to subsistence farmers certainly improves their lot. But it is not cheap: a single connection in Kenya can cost nearly $2,500. And since few people in rural areas can afford to buy power-hungry appliances such as fridges or air conditioners, there is little chance that utilities will make much of a return on their investment. For people in rural areas, off-grid power such as solar panels or small hydroelectric systems may be a better option. Abandoning the attempt to connect them to the grid would mean more money to invest in urban areas.

Almost all African utilities “are basically bankrupt”, says Chris Trimble, a researcher for the World Bank who is based in Senegal. And that in turn lowers investment where it is most needed.

Nairobi, for example, has more than enough power. Even so, big firms maintain backup generators to see them through frequent blackouts. The grid’s old transformers explode when it rains. The entire country can lose power if they fail, as happened last year when a monkey climbed onto one. Fish dropped by seagulls onto power stations have been known to plunge Dakar, the capital of Senegal, into darkness.

Worldwide, power consumption is strongly correlated to GDP, but in Africa most countries use less power than their incomes would predict. That is largely because Africa has so little manufacturing and heavy industry. If electrification programmes continue to focus on rural areas, utilities may be too cash-strapped to maintain the grid where it really matters: in cities and industrial regions where investors are building factories. Without industrialisation and good jobs, few Africans will be able to afford much more electricity. That is real powerlessness. ^ (The Economist)

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