• Thursday, May 30, 2024
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Business Continuity for Mini-Grids Post-COVID 19

Business Continuity for Mini-Grids Post-COVID 19

We rarely get any notice that a disaster is going to strike, and as a result, a lot of businesses tend to carry on as usual without a concrete business continuity plan. However, since the advent of the disruption brought about by COVID 19, many business owners have gone back to the drawing board to put processes in place for business continuity, as well as planning for business recovery after disruptions and disasters such as the current global pandemic.

According to CIO Africa, business continuity (BC) refers to maintaining business functions or quickly resuming them in the event of a major disruption, whether caused by a fire, flood, malicious attack by cybercriminals, or even a global health crisis of the magnitude of COVID 19. A business continuity plan helps to outline procedures and instructions an organization must follow in the face of such disasters; it covers business processes, assets, human resources, business partners, and more. As such, it is necessary in order to maintain business processes as well as increase operations for businesses to survive.

Like many other viable businesses, the mini-grid-based electricity supply business faces a number of challenges including a risky business environment due to unknown consumer characteristics and unfamiliar business activities, insufficient institutional and regulatory support, limited access to low-cost finance, and inadequacies in local skills and capacities.
Amongst the numerous adverse effects of the current global Covid-19 pandemic on the Nigerian off-grid sector in the last six (6) months includes, the delay of ongoing development projects. Across the country, we have witnessed a chain of suspended mini-grids due to interrupted supply chains; state and Federal government restrictions; and a sharp decline in human mobility. Generally, these have had limiting effects on the nascent sector and delayed its scalability.

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In the heat of the pandemic, however, certain businesses have shown great resilience. Some of these businesses have done so by either reinventing themselves to enter into new emerging markets, or simply by proffering solutions that are too impossible to ignore at this crucial time. The leading mini-grid developer in Sub-Saharan Africa, Green Village Electric (GVE) is being propelled, despite the odds, by the need to reach the unserved and underserved communities with access to reliable and sustainable energy.
For instance, a major milestone in the ongoing Wuse market solar-powered interconnected mini-grid project has recently been reached – GVE obtained the regulatory permit from NERC, which is the legal kick-off of mini-grid projects in the country. This is noteworthy as it demonstrates an undeterred willingness by the sector regulator to support the role of mini-grids in the economic development of communities.

This will go a long way to ensure that the first private-sector-led interconnected mini-grid PPP project delivers on its promise to foster the rapid development of the economic community – Wuse market – on time, and also provides the opportunity for both the leading mini-grid developer and the franchise distribution company (DisCo), Abuja Electricity Distribution Company (AEDC), to grow their businesses through this financially viable business model.

As part of the first phase of the project, the market has already begun to experience dramatic new developments. Green Village Electricity, in line with its social impact goals for the Wuse market economic community, has provided additional lighting for the market vicinity through solar street lighting, ensuring that the market area is more secure and protected from theft and hoodlums. This also provides the traders and technicians with extended production and trading hours, leading to increased overall economic productivity for the region and the Abuja city center by extension.

The recently concluded pilot and Phase I of the project has succeeded in providing relevant information on the energy consumption needs of specific trade areas in the market community and has further prompted the procurement of an advanced AMI/AMR compliant billing/metering suite to ensure better revenue collection and customer demand management for the RE utility company.

This progress further illustrates the importance of creating a commercially sustainable model that can quickly recover from the effects of a global economic shutdown and an enabling regulatory environment for de-risking energy investments and helping mini-grid businesses to thrive. By providing this, the regulator and other supporting agencies clearly show an understanding of the impact of driving energy access, thereby linking short term recovery benefits post-COVID 19 with the long-term sustainability of the country’s economy.

The GVE-led pioneer commercial project has continued to progress due to a combination of the company’s tenacity and resilience as well as an adaptive and innovative business model centered on community ownership. It is, therefore, evident that employing a viable business model is tantamount to ensuring business continuity for mini-grid businesses in the immediate post-COVID era as well as in the medium and long term.
*Talatu Tarfa is the Assistant Manager, Energy Access at Clean Technology Hub.
** Ifeoma Malo is the C0-Founder/CEO of Clean Technology Hub.

Rich nations energy stimulus failing to create jobs, deepen renewables – study
A new report from global technology company Wärtsilä has revealed that the G20’s stimulus packages are weighted to support legacy energy systems; missing the opportunity to create jobs and accelerate the transition towards flexible, renewable-powered economies.
Wärtsilä’s report titled, Aligning Stimulus with Energy Transformation, presents modelling of scenarios where the United States and the United Kingdom focus their current stimulus packages for energy on measures that accelerate the energy transition, aligning economic recovery with decarbonisation.
In addition, the report provides viewpoints from Wärtsilä experts in a range of other G20 countries, including Germany, Australia and Brazil. The report analysis is founded on two key sources, Wärtsilä’s Atlas of 100% Renewable Energy, and the Energy Policy Tracker.

Creating half a million green jobs in the US alone
In the United States, if the current stimulus pledged to support legacy fossil fuel sectors ($72 billion USD) was allocated to advance modern, flexible, high-renewable power systems, over 100 GW of new renewable energy capacity could be achieved. This would result in over 500,000 new jobs in renewable energy, 175% more new jobs than if stimulus was focused on legacy, inflexible energy systems.

Modelling a carbon neutral US by 2035
Furthermore, Wärtsilä has modelled a scenario for a carbon neutral electricity sector for the United States by 2035. The model demonstrates that a cost-optimal carbon neutral power system could be achieved with 1,700 GW of new wind and solar, supported by battery energy storage and flexible gas-fired power capacity operating on renewable bio- or synthetic fuels. The fully renewable power system would create 8.7 million jobs in renewable energy alone and have an expected investment cost of $1.7 trillion USD.

Crucially, the Wärtsilä report reveals that to ensure reliability of a renewable-powered electricity system, over 400 GW of battery energy storage capacity and over 100 GW of flexible gas power capacity, running on renewable synthetic fuels would be needed. Over 150 GW of electrolyser capacity for Power-to-X processes would be installed for the production of synthetic fuels. Wärtsilä’s analysis results illustrate how Power-to-X processes will be a key component for providing flexibility and stability for renewable power systems.

Leveraging the energy stimulus to reach a 60% renewable power system in the United Kingdom
Wärtsilä’s analysis identifies that current energy stimulus, if utilised to leverage private sector funds towards the energy transition, could help the United Kingdom to reach a 60% renewable power system and cut power sector emissions by 58%. The system would have 60 GW of renewable energy, supported by 7 GW of battery energy storage and 14 GW of flexible gas-based generation for flexibility. This would create over 120,000 jobs in the renewable energy sector alone and put the UK on track to meet its net-zero emissions target by 2050.

“At the brink of a clean energy revolution”
Sushil Purohit, Energy Business President, Wärtsilä, said: “Across the G20 countries, the stimulus ‘scales’ are strongly weighted to support legacy inflexible power systems, despite the agenda for rapid decarbonisation that’s underway worldwide. In our modelling of two world-leading energy markets: the US and the UK – it’s clear that both countries stand at the brink of a clean energy revolution, that could provide a blueprint for other economies to follow. Refocusing stimulus towards renewable and flexible energy would accelerate this shift, create jobs and cut emissions.”