Innovation and Scale: Enhanced energy access and local market development in sub-Saharan Africa

3cd2ef6c-24da-449d-a911-a73da3bc0ae6

Closed

ESRC
ESRC
ESRC
ESRC
ESRC

£3,382,875

Aug. 31, 2018

Feb. 29, 2020

Achieving energy access for all is a UN Sustainable Development Goal (SDG) in itself, and directly facilitates the SDGs of sustainable industrialisation, sustainable cities and communities, and reducing inequality. Sub-Saharan Africa (SSA), the most energy-deprived region in the world, arguably constitutes the greatest obstacle for realising these goals. An estimated 700 million people in SSA - the majority of them in rural areas -lack electricity access, a number that is only expected to rise as the continent's rural population growth outpaces capacity growth. The three SDG dimensions of achieving energy access - affordability, reliability and sustainability - each stand in stark contrast to the status quo: while the cost of electricity in SSA can be orders of magnitude higher than in industrialised countries, blackouts are frequent, and less than a quarter of energy supply comes from renewable sources. Energy poverty has impaired SSA's economic development since its independence in the 1960s, indicating that new approaches are urgently required.

Given the extent of rural energy poverty, limited rural purchasing power and logistical difficulties, innovative, locally driven business models for the renewable energy sector are required to achieve comprehensive rural electrification in SSA. In particular, rapidly falling system costs have made renewable off-grid solutions the cheapest and cleanest option in many remote areas. However, three main issues have prevented sustainable electrification: difficulties in attracting international investment to small-scale renewables; inconsistent and often opaque regulatory and institutional frameworks; and a failure to include local communities, i.e. customers, in planning. Research to date is alarmingly scarce in all three of these areas in SSA.

This interdisciplinary research therefore aims to design integrated, actionable and transferable development strategies for the local renewable energy sector capable of delivering comprehensive, sustainable rural electrification in SSA. Echoing the GCRF call's sentiment, we believe that the way to unlock this potential is via scaling up small to medium-sized innovative business models, institutional reforms and social inclusion strategies. The research pursues three mutually reinforcing areas of inquiry: suitable business models for a competitive local renewable electrification industry; optimal institutional arrangements to facilitate the development of the industry; and enabling community involvement, especially in rural areas. We deploy a comparative country case study approach, focusing on the contrasting situations of Uganda and Zambia, in order to increase the generalizability of our findings for other countries in SSA.

The proposed project is deeply committed to deliver impact beyond academia. Identifying current barriers to scaling rural electrification and developing solutions to overcome them can only be successfully achieved through including local business, public sector and communal stakeholders. These stakeholder groups - including Uganda's and Zambia's regulatory and legislative bodies, local businesses, and civil society - will therefore be repeatedly engaged throughout and, where possible, beyond the project. We will use several channels to implement our results: practitioner reports targeted at African renewable energy SMEs and energy regulators; the development and implementation of innovative business models, including novel financing and revenue schemes developed with community input; a digital SME renewable energy network where different companies in SSA can directly engage with one another; workshops to convene all stakeholder groups; private one-to-one meetings with public sector representatives; and research seminars at local universities to train future decision-makers. Given our focus on a local, African-owned and -run industry, we also foresee further benefits for local employment and knowledge creation.

Potential Impact:
Impact is an integrated dimension of the proposed research project. The workstreams are structured according to three key beneficiary groups: local businesses, energy sector institutions and rural communities. Each of these stakeholder groups is therefore a key focus of the project's research questions. In addition, our pathways to impact strategy focuses on the same stakeholder groups to ensure that impact can be maximized both during and after the project. We will actively engage all three beneficiary groups throughout the project to jointly develop solutions.

First, local businesses in Uganda and Zambia will benefit through access to best practice guidelines for renewable energy business models. This access will be facilitated in both countries through two local energy think-tanks, the Centre for Development Alternatives (CDA) in Uganda and Prosperity in Zambia. We will select several small to medium scale enterprises (SMEs) in the renewable energy sector in Uganda and Zambia who are willing to work with us in identifying and implementing suitable business models to scale up their operations (Green Global Consult Ltd. in Uganda and Winch Energy Ltd. in Zambia have already signaled their willingness to cooperate with us on the study). We intend to invite local businesses to two integrated workshops, one in Uganda and one in Zambia, to meet institutional and community stakeholders and exchange ideas for how best to implement the findings. The workshops will ensure that the main objective of the research project, the development of integrated strategies for sustainable rural electrification, can be supported across different stakeholder groups and thereby lead to lasting impact. Furthermore, local businesses in other sub-Saharan African (SSA) countries will benefit through the dissemination of generalizable best practice guidelines. Our pathways to impact strategy includes additional activities that will help to disseminate these guidelines, provide the means for local businesses to engage in discussions and to build the capacity to support local renewable energy markets. For instance, we cooperate with the Planet Earth Institute to promote a digital SME renewable energy network in SSA which will facilitate the sharing of best practices among local SMEs.

Second, energy sector institutions will benefit through improved understanding of the arrangements that support local renewable energy markets. We will engage with institutional stakeholders through interviews throughout the project, and share our research findings with the relevant institutions in both Uganda and Zambia, including utilities, regulators, rural electrification authorities, and energy ministries. In addition, our country-level workshops will bring together public institutions, with local businesses and communities. The institutions present in Uganda will be the Rural Electrification Agency, Electrification Regulation Authority, the Ministry of Energy and Mineral Development, UEGCL, UETCL and UMEME. In Zambia, these will be the Rural Electrification Agency, the Energy Regulatory Board, a Member of Parliament in Zambia and Zesco.

Third, local communities in Uganda and Zambia will ultimately benefit from improved access to affordable, sustainable and reliable electricity. This includes the direct benefits of access to electricity, such as enhanced study possibilities, reduced health hazards and, in the medium term, income generation activities, as well as indirect benefits through local job creation and skills development. We will furthermore develop inclusive mechanisms of decision making aimed at delivering energy solutions which are tailored towards specific communal needs. Aiming to create a precedent for inclusive policy making, we will invite community representatives to our integrated workshop towards the end of the research project.