The Covid-19 pandemic is causing significant disruptions around the world. The IMF’s World Economic Outlook projects that global growth will contract by 4.4% in 2020 but rebound by 5.2% next year. In sub-Saharan Africa, the continuing spread of Covid-19 is expected to result in the regional economy contracting by 3% in 2020, with growth picking up slower than the global average at 3.1% in 2021. Despite the projected uptick in growth next year, the International Energy Agency (IEA) is projecting that past progress on energy access could be reversed due to the Covid-19 pandemic in the region.
The IEA’s Access to Electricity report mentioned that while the number of people without access to electricity has steadily declined since 2013 in sub-Saharan Africa, it is now set to increase in 2020. This may push many countries further away from their goal of universal electricity access by 2030. The reversing trend in the region could have significant implications in fighting diseases and Covid-19, as reliable energy access is critical to powering healthcare facilities and supplying clean water for essential hygiene. Moreover, the World Bank has highlighted that energy access is an integral component in driving forward a sustainable economic recovery. In sub-Saharan Africa, access to reliable power can empower clinics, utilities, companies and citizens to mitigate Covid-19 impacts and pave the way for a more resilient long-term recovery.
Developing an energy ladder to service rural off-grid and more urban markets
Both the IEA and the World Bank have mentioned that innovative technologies, such as decentralised micro-grids, can play a key role in addressing energy challenges to power healthcare services, businesses and communities in sub-Saharan Africa. One company driving this initiative forward is ZOLA Electric. For the past decade, ZOLA Electric has been building distributed solutions that deliver clean, affordable and reliable 24/7 power in sub-Saharan Africa. As Covid-19 spreads across Africa, the need to provide reliable energy has become even more critical to keeping businesses and hospitals open, along with keeping homes powered to allow remote work in urban and rural regions. Bill Lenihan, CEO of ZOLA Electric, said in an interview that managing these varied cases requires “customised solutions that help deliver reliable power to people, communities and businesses operating in the region”.
In managing power demand from customers, ZOLA Electric has developed an “energy ladder” system that allows their Infinity and Flex products to deliver reliable, clean power in sub-Saharan Africa. Mr Lenihan said that “ZOLA’s flexible product offerings allow individual and businesses choice and the ability to upgrade based on requirement”. In light of Covid-19, he added that “ZOLA Electric has been able to support remote work by providing customers with ZOLA Flex, a plug-and-play, connected, solar and storage hybrid power system which has allowed access to reliable power and internet connection”. For customers with larger energy requirements, Mr Lenihan noted that ZOLA’s Infinity was designed to combine solar technology with energy storage to deliver 24/7 AC power to “anyone, anywhere” and service homes and businesses with weak grid connections in off-grid areas where energy infrastructure is non-existent.
New partnerships to provide reliable power for primary care clinics
The Covid-19 situation has challenged many primary care clinics in rural Africa, as they require reliable power to operate health equipment. Mr Lenihan highlighted that since the outbreak, “ZOLA Electric has actively been developing energy solutions for primary care clinics to manage Covid-19”. In August 2020, ZOLA Electric partnered with Econet Global to deploy plug-and-play energy solutions for mini-grid initiatives in Nigeria, DRC, Zambia, Malawi, Zimbabwe, Mozambique and Lesotho. In Africa’s primary care clinics, there is a need for strong energy infrastructure to power medical equipment and to refrigerate blood samples and vaccines. As part of the initiative, ZOLA Electric will deploy its autonomous Infinity solution to build energy capacity for primary care clinics that are mainly off the grid and would need reliable power to deliver critical medical services. According to the World Bank, in sub-Saharan Africa, only 28% of healthcare facilities benefit from reliable electricity, and only 43% of the population has electricity at all. For this reason, the development of strong energy infrastructure is necessary to address the longer-term effects of the Covid-19 crisis and provide healthcare services. From Lenihan’s perspective, the fight against Covid-19 will “require deploying more advanced energy access solutions to the front lines such that health clinics can operate essential services such as a ventilator, an oxygen machine, lights and refrigeration of blood samples and vaccines”. By doing so, these primary care clinics would be able to play a critical role and support local communities in preventing diseases and fighting pandemics.
Besides powering primary care clinics in rural and remote regions, ZOLA Electric’s mini-grid initiatives could have a broader impact on the surrounding local community. Mr Lenihan mentioned that “ZOLA Infinity’s modular architecture allows for growing grid connectivity that could also add homes, shops and businesses to form a combined grid”. In rural regions, ZOLA’s combined grid system that centres around the primary care clinic would then be able to provide reliable electricity to the local community. Mr Lenihan pointed out that in designing the mini-grid initiatives, ZOLA has also “developed an intelligent architecture that monitors and deploys the most efficient and cost-effective power supply from any source, including solar, battery, power grid or generator”. For the primary care clinic and the local community, these intelligent mini-grid capabilities allow a continuous supply of power that would not only bode well in addressing healthcare challenges but also foster economic progress by enabling local shops and entrepreneurs to scale their businesses.
Building technology to integrate decentralised micro-grids with the national grid
The key to ZOLA Electric’s technology is the potential to integrate their Infinity system with the national grid in the future. In sub-Saharan Africa, the World Bank has estimated that 6 out of 10 people do not have access to electricity in the region and highlighted mini-grid solutions as the most cost-efficient way of supplying electricity and helping countries implement their national electrification plans. The World Bank views mini-grids as a “win-win” because they can pave the way for more financially viable future grid expansion and generate demand in rural regions. However, the future viability of this solution would ideally work when the mini-grids can integrate with the national grid to avoid becoming stranded assets. According to Bloomberg, national governments can play an integral role by establishing clear grid arrival rules to protect the value of isolated mini-grids in the event the main grid reaches isolated mini-grids in rural regions.
As an example, the Nigerian Electricity Regulatory Commission Mini-Grid Regulation 2016 provides a useful blueprint whereby in the event the main grid reaches isolated mini-grids, the assets can be integrated or transferred to the national grid operator in return for financial compensation. Through this mechanism, mini-grid owners and investors can protect the value of their investment, and the utility can cost-effectively expand into rural regions. On the possibility of grid integration, Mr Lenihan said that their technology is “ready” and ZOLA’s Infinity is “uniquely positioned to connect with the grid in the future”. For consumers, there are several upsides to grid integration as well. Firstly, the ability to access reliable power throughout the day. Secondly, but more importantly, the ability to leverage their solar system and sell excess (or all) electricity back to the distribution company at a feed-in tariff annually determined by the regulator. For Lenihan, bringing “net metering” to ZOLA’s customers can’t come quickly enough. He noted that the ability to “generate recurring cash flow from their assets would empower and enable individuals to recoup their initial investment.”