Renewable energy in TanzaniaIn 2018, 29% of the population in Tanzania had access to electricity. For rural populations, that number was 10% and for poor households, it was 7%. About 66.2% of Tanzania’s population lives in rural areas, according to data from 2018. This means that most of the population that needs electricity lives in off-grid regions. The Tanzanian government and other organizations seek to meet this need through innovative renewable energy solutions.

Renewable Energy in Tanzania

Renewable energy in Tanzania has great potential. Tanzania’s renewable energy resources include hydropower, solar, wind and biomass. A study completed by the Institute for Sustainable Futures from the University of Technology Sydney, the Climate Action Network Tanzania, Bread for the World and the World Future Council found that by 2020, Tanzania’s portion of renewable energy generation was thought to reach 53%. By 2030, that number could increase to 75%. The study also discovered that it is 30% cheaper for Tanzania to use renewable energy than energy from fossil fuels. Thus, the study recommends implementing 100% renewable energy in Tanzania so that the country can substantially decrease poverty levels.

Importance of Renewable Energy Access for Poverty Reduction

Energy access is crucial in the fight to end poverty. Renewable energy is valuable for poverty reduction because it can provide power to more schools. Furthermore, it can increase health services and hygiene and provide clean water in rural areas. In fact, the World Bank cites increased electricity access as one of the reasons poverty rates have decreased in Tanzania.

According to the World Future Council, due to the increase in energy access, people in rural areas have been able to focus on “efforts to improve their socio-economic welfare.” Women, in particular, have benefited greatly from energy access. They can spend more time working on other tasks rather than working in the home and in the field.

Projects and Initiatives

Renewable energy in Tanzania has increased over the past decade because the government and other organizations have been working on renewable energy projects. These initiatives include installing off-grid and grid power systems and advocacy work.

Lighting Rural Tanzania installed solar lanterns and solar home systems to mostly low-income households. The goal of the project was “to enable access to cleaner and safer off-grid lighting and energy for 6.5 million people in Tanzania by [the] end [of] 2019.” Overall, the project helped provide energy access to 1.2 million people as of 2018.

The Tanzania Renewable Energy Association (TAREA) is a membership organization dedicated to improving renewable energy technologies and increasing access to renewable energy in Tanzania. The organization provides ten distinct services with advocacy and awareness work, community access programs and renewable energy policy initiatives.

Last is the Rural Electrification Expansion Program for Tanzania (TREEP). Beginning in 2013 and ending in 2022, TREEP’s goal is to provide both grid and off-grid energy to 1.3 million rural households and businesses. The project focuses on solar energy, specifically photovoltaic systems. As of 2021, The World Bank has labeled TREEP as “moderately satisfactory.”

Looking Forward

While less than half of Tanzanians have access to electricity, governmental initiatives and dedicated organizations are succeeding in increasing energy access. According to the International Energy Agency, Tanzania hopes to ensure that 70% of the population has access to electricity by 2030, with 50% of that originating from renewable energy resources.

– Sophie Shippe
Photo: Flickr

Energy Vault
“Energy poverty” is a term that describes the lack of reliable, affordable sources of energy. More than one-seventh of the world’s population still lacks electricity, and in countries where it is available, it is often very expensive or unreliable. Access to energy is essential to people’s health and wellbeing, and it is instrumental in reducing poverty. Countries will not be able to engage in economic activities without modern, efficient energy. This in turn slows economic growth, which is a necessity for countries to pull themselves out of poverty. The poor will remain outcast and unprosperous, shut out from the high technology world if energy poverty persists. Here is some information about renewable energy and the Swiss startup Energy Vault that is providing low-cost energy to developing countries.

Renewable Energy

Renewable energy has the potential to help the developing countries that are struggling to provide power. It is sustainable and efficient, and the more efficient the energy technologies are, the more energy a country can save to use elsewhere. Renewable energy may seem like the perfect solution to energy poverty. In practice, however, the familiar forms of renewable energy like wind and hydropower pose various challenges.

Barriers to Renewable Energy Use

First, renewable energy has a high initial cost. In order to harness renewable energy, countries must build specific structures to capture it and convert it into electrical power. If using hydropower, a country must build a hydropower plant; in the case of wind energy, a country must build wind turbines. Furthermore, energy generation is dependent on the climate and geography of the area and it may be unstable. Wind does not blow incessantly, and the turbines will not generate any energy when there is no breeze.

In the example of hydropower, areas may not have water to spare to power hydroelectric plants. More than 40% of the world’s people still do not have access to clean water, and it would be unwise for countries to use the little they do have on hydropower when their own people are still struggling. While renewable energy seems like the best option for developing countries, it presents several challenges when implemented.

Energy Vault

In response to this issue, Energy Vault, a Swiss startup, developed a method to provide reliable energy by utilizing the force of gravity. It operates by lifting composite bricks, then lowering them back to the ground. The brick has kinetic energy as it goes down, which the structure converts into electricity. It uses similar principles to hydropower but replaces the water with a system of bricks. This makes the system more implementable than hydropower since it does not divert water away from the population, who need it for drinking. Any area can implement Energy Vault easily because it does not depend on geographical or climatic factors. Unlike hydropower, wind power or solar power, it can generate electricity under any conditions. Energy Vault is extremely low cost and affordable to developing countries that need it.

In addition to its reliability, Energy Vault is sustainable. It can last for more than 30 years, and its performance will not degrade at all throughout its life. Recycled waste and landfill materials make up the bricks that Energy Vault uses, and as such, they are readily available anywhere.

The affordability and sustainability of Energy Vault make it a good energy source for struggling countries. Though energy poverty is still a major issue in many areas of the world, startups like Energy Vault offer innovative solutions to combat it.

Alison Ding
Photo: Flickr

Brazil's Emerging Market
Brazil currently has the ninth-largest economy in the world. It has a gross domestic product (GDP) of $2.05 trillion which accounts for slightly more than 2.5% of the global GDP in 2020. Brazil would account for 2.5% of the world’s wealth if one measured it by all of the goods and services it exchanged in 2020. Thus, Brazil’s emerging market has become a reputable force on the world economic stage. It has now surpassed some developed economies in GDP. For example, Brazil’s economy is now larger than Italy’s, which accounted for 2.4% of global GDP in 2020. Several factors contribute to the success of Brazil’s emerging market: better international relations, the adaptation of technology and improved education. However, the most important element of an emerging market is a solid mix of domestic companies. Here are three Brazilian companies that have been driving the economy forward.

Eletrobras

Eletrobras is the number one supplier of electricity in Latin America. Additionally, it projects that it can be one of the top three clean energy suppliers for the entire world by 2030. Furthermore, Eletrobras differentiates itself from other energy companies by focusing on generating electricity through renewable methods. In fact, the company strives to ensure that less than 10% of electricity produced comes from sources that have high greenhouse gas emissions. Eletrobras utilizes hydropower and wind farms to create the vast majority of its electricity.

The company supplied about one-third of Brazil’s total energy in 2020. As a result, there was a reduction in reliance on foreign energy companies. In addition, it provided vast employment opportunities to Brazilians and residents of other Latin American countries.

Vale

Vale is a Brazilian mining company responsible for churning out more iron ore and nickel than any other mining company. Iron ore has multiple applications and is the raw ingredient for steel. One can find it in cars, trains, sinks, dishwashers and much more. Additionally, a battery’s fundamental material is nickel. It has a shiny appearance and is inexpensive. Therefore, many countries use it to make their currencies.

Vale now employs more than 100,000 workers ranging in countries from Canada to Indonesia. The company has been able to successfully push into other sectors including artificial intelligence and energy production.

Itau Unibanco

Itau Unibanco is Brazil’s largest bank in the private sector. The company’s headquarters are in Sao Paulo and it employs more than 90,000 people across nine countries. The government now owns the majority of the company’s equity because it is in the private sector. The primary shareholders are private institutions, corporations and individuals. As such, Itau Unibanco is a bank for everyday workers.

Furthermore, Itau Unibanco has a commitment to giving back to the community. The company invested more than $0.5 billion into education projects and improving transportation infrastructure in Brazil. It shows that people should not consider domestic companies that give back as charities, but rather as an investment in the people.

The Reason these Companies Matter

These companies are critical to Brazil’s emerging market for two major reasons. First, Brazil needs businesses that spark interest in countries abroad to make the leap from emerging markets to the developed economy. All three of these companies successfully accomplished this goal. As such, these companies are appealing to many nations. As a result, there is an inflow of non-domestic goods and services. This allows the economy to expand and raise the overall quality of life for everyone.

The second reason is that these companies provide employment opportunities to Brazilian citizens in diverse sectors. Brazil needs companies such as Eletrobras to provide electricity in an economic boom and a severe recession. In addition, Brazil needs Vale to produce steel. In the end, these companies create many opportunities for Brazilian citizens in many sectors.

If Brazil can navigate through the pandemic while keeping companies like Eletrobras, Vale and Itau Unibanco afloat, it has a fair shot at becoming a developed economy in the future.

– Jake Hill
Photo: Wikimedia Commons

Brightlife Brings Financial Inclusion
BrightLife is a program from FINCA, the microfinance organization. The program is a Uganda-based, social enterprise that pairs access to finance with access to energy. This allows for connections to financial inclusion for the “unbanked.” BrightLife brings financial inclusion to Ugandans and clean energy products to poor and impoverished areas through multiple initiatives and products. BrightLife ensures financial inclusion and wellbeing for those areas. People pay for their BrightLife products with a system called PAYGO. This allows people to pay for only the electricity they use as they go. This then allows BrightLife to build credit profiles for “unbanked” people and connect them with FINCA.

The Situation in Uganda

There are currently 1 billion people in the world living without electricity and 73% of the Ugandan population does not have access to electricity. People living without electricity must often use insufficient fuels to heat, light and energize their homes. This can then lead to indoor air pollution causing premature death. These energy uses are also dangerous in homes since they can cause fires.

Lack of energy in any area can cause a cycle of poverty since so many people cannot access the most basic necessities. This is why BrightLife brings financial inclusion to Ugandans. As FINCA states, the program “provides last-mile distribution and end-user financing for products that create healthier and safer homes, increase productivity, reduce household expenses and provide additional income-generating opportunities.”

BrightLife’s Impact

To date, BrightLife has impacted over 202,000 lives with clean energy. By providing education, distribution, financing and after-sale support, BrightLife is able to bring clean energy products like home appliances to people who cannot acquire them. However, access to energy is just the first step in FINCA’s BrightLife enterprise.

BrightLife announced a new product called “Prosper” in March 2019 to further its impact on the Ugandan people. Prosper is an initiative that helps Ugandans access the clean energy that BrightLife provides. Then, Prosper helps people transition from unbanked to FINCA Uganda where they can access savings and credit opportunities, increasing their financial inclusion.

A Better Tomorrow with BrightLife

Now, BrightLife is working to better understand the solar energy needs of their clients and is positioning itself to serve communities more efficiently. Through COVID-19, it has been able to grant access to solar lanterns and give students the ability to still get the education they need from home. Since BrightLife brings financial inclusion to Ugandans, it also won the Smart Communities Coalition Innovation Fund grant. As USAID reported, this grant will allow for the development of “a solar-powered hatchery” and small-scale solar systems used for poultry farming in Kiryandongo, Uganda.

– Grace Aprahamian
Photo: Flickr

The Success Story of Ghana's Electrical System Ghana’s electrical mini-grids have made the country a leader in capacity and access to electricity in sub-Saharan Africa. Ghana’s government and international institutions like the World Bank have worked together for over two decades to bring light to more than 30 million people. A major part of the success in the region is due to its focus on increasing reliability, distribution and renewable resources. Ghana is an example of what is possible when international forces come together to give aid to developing nations, transforming the countries into industrialized global partners.

Electricity in Sub-Saharan Africa

As of April 2020, USAID found that Ghana had 4,3999 MW of installed energy capacity. However, only 2,400 MW of energy is available due to Ghana’s reliance on hydroelectricity, fossil fuels and ailing power infrastructure.

On the other hand, Cameroon only had 1,558 MW of installed electrical capacity in 2017 and a population of more than 25 million. Moreover, Cameroon’s electricity access rate was only at 61.4% at this same time. Urban regions and rural regions have a massive disparity in access with 93.2% and 21.3% respectively. As such, Ghana’s electrical grids are improving at a much faster rate than those around them.

Creating Solar Mini-Grids in Remote Communities

In 2007, Ghana, in partnership with the World Bank, approved the Energy Development and Access Project. As of January 2021, the project has financed more than $210 million to Ghana. By September 2020, 1.73 million people in Ghana have gained access to electricity. The 2022 target is for a total increase in access for 1.95 million people. The international resources provided have helped Ghana’s government implement its national electrification plan and is the reason for its successful electrical system.

The Ghanaian government in 2018, through its National Electrification Scheme (NES), identified 11,000 communities connected to the national grid. The Ghana Ministry of Energy in 2019 stated that it cost $2 billion to reach this number. The Ghana government also estimates that about three million citizens lack access to the electricity grid.

What it Takes to Create Solar Mini-grids in Remote Communities

Ghana and its partners have been successful in providing more than 90% of Ghana with electricity access. However, funding has been a challenge. Extending electric grids to connect the remaining communities could cost up to $900 million. The country also faces a shortage of funding due to “strict conditionalities of development partners and the rising cost of borrowing.” In order to deal with this issue, the government has established a unique initiative.

Mini off-grid electricity was implemented by NES to meet the rising cost of connecting rural communities to the national grid. This initiative brought light to these remote regions by installing 20 mini-grids in 2019. The average cost of connecting a household to a mini-grid is $2,000 and have set aside funds for many more.

The Benefits of the Mini-Grid

Ghana’s infrastructure, which its national energy grid relies on, is often unreliable in remote areas. While Ghana’s electrical mini-grids have more upfront costs, it offers more reliable electricity. Pediatorkope is a small island town in Ghana and one of the first regions to receive a mini-grid in Ghana. The World Bank’s report outlined that while the costs of the grid were more significant than if they had connected the town to Ghana’s national grid, the solar mini-grid provided a more reliable system for the town. Ghana’s national grid is under a lot of stress. These mini-grids offer reliable energy distribution systems for remote communities, providing tangible benefits to Ghana’s rural population.

The World Bank stated that mini-grids would “provide wider economic benefits to the community.” Solar power is one of the renewable resources that play a significant role in these mini-grids. Native Ghana companies, international energy corporations and governmental agencies supply, maintain and operate these mini-grids.

Naomi Dagrey, a Ghanaian citizen with a mini-grid has been financially saved by her community having consistent access to electricity. “Once we got connected to electricity, I invested in a refrigerator which I use [for] frozen beef and chicken,” she stated in a World Bank promotional video. The success of Ghana’s electrical mini-grids has changed the way people are able to live and has opened the doors for future possibilities.

– Jacob Richard Bergeron
Photo:Flickr

Burkina Faso Compact II to Lift 8 Million Out of Poverty
Despite having one of the fastest-growing economies in Africa, the nation of Burkina Faso struggles with significant developmental challenges. One such challenge is a lack of adequate access to affordable electricity across the country, which the Burkina Faso Compact II will combat.

Electricity and the Economy

A lack of access to electricity ties to a lack of economic opportunity. When a country or area receives proper access to electrical grids and services, new businesses can open, existing businesses can operate on a higher level and jobs can emerge.

The Millennium Challenge Corporation’s (MCC) Burkina Faso Compact II is a program intended to address the nation’s electricity challenges to promote a healthy economy and lift 8 million people out of poverty.

Burkina Faso Compact II

Burkina Faso is one of the most impoverished nations in the world. In 2017, the Gross National Income per capita was $610. The majority of the impoverished also live in rural areas, with approximately 90% of impoverished households in Burkina Faso in rural parts of the country.

Although the nation has a high rate of poverty, it is home to one of Africa’s fastest-growing economies. In 2019, Burkina Faso’s GDP was growing at a rate of 6%. Experts believe the high concentration of poverty in rural areas is due to low rates of agricultural productivity, social isolation, underemployment and inadequate access to electricity. The recent improvement in the GDP growth rate is a result of the positive performances of the agricultural and mining sectors.

The Millenium Change Corporation’s Burkina Faso Compact II was signed on August 13, 2020. The Burkina Faso Compact II dedicates itself to connecting more of the country to electrical grids. The MCC has dedicated $450 million in grants and funding to the goal of widespread electricity.

MCC’s Compact Projects

In addition to MCC’s contribution, the Burkinabe government agreed to contribute $50 million to the compact projects. The program focuses on three smaller electricity projects: The Strengthening Electricity Sector Effectiveness Project, the Cost-Effective and Reliable Energy Supply Project and the Grid Development and Access Project. These projects will work together in order to help Burkina Faso increase access to electrical grids for all citizens.

Of the $450 million that will go toward improving addressing the issue of electricity, $210.7 million is for the Grid Development and Access Project alone. This project is particularly important to reaching the goal of widespread and accessible electricity nationwide. In the Grid Development and Access Project, the MCC hopes to aid in reducing power outages and increasing access to electrical services.

The Strengthening Electricity Sector Effectiveness Project and The Cost-Effective and Reliable Energy Supply Project received $46.9 million and $99.5 million respectively. The goal of the Strengthening Electricity Sector Effectiveness Project is to strengthen the electricity sector through important reforms, including building up the capacity of national utilities, the Ministry of Energy and regulators. The Cost-Effective Energy Supply Project aims to implement lower energy costs by introducing solar power, battery storage and improving electricity dispatch centers.

Burkina Faso Compact II Long-Term

This compact is the second project MCC has taken on in Burkina Faso. The first Burkina Faso Compact included $480 million to improve infrastructure, agriculture, girls’ education and water management. Since the completion of the project in 2014, Burkinabe government ministries have been maintaining what the project implemented. This shows great promise for the Burkina Faso Compact II.

In the long term, the Burkina Faso Compact II will ultimately improve living conditions and economic stability for more than 8 million people across Burkina Faso, leading to lower rates of poverty. Improving access and affordability of electricity is a positive step toward improving Burkina Faso’s economy.

– Maddi Miller
Photo: Flickr

Improving Energy in AfricaOne in 10 people in the world (800 million) have no access to electricity and the access of an additional 2.8 billion people is considered insufficient and unreliable. In regions with insufficient access to electricity, the standard of living is poor, particularly with regard to adequate healthcare and education. Africa is such a region. Half of the population of sub-Saharan Africa lives without electricity. Improving energy in Africa is essential for economic growth and prosperity across the continent.

The Consequences of Inadequate Energy Access

Energy is vital to reduce the cost of business activities and for creating economic opportunities and jobs. More than 640 million Africans lack access to electricity. When the sun sets for these individuals, workable hours in the day end. Insufficient access to energy can also restrict the economy more indirectly, by way of increased risk of deaths related to wood-burning stoves, restricted hospital and emergency services and compromised access to education.

Along with appropriate infrastructure, household health and productivity are essential for boosting economies. The persistent use of wood-burning stoves is evidence of lacking infrastructure that presents a burden to health and productivity. This dated method has drawbacks that include indoor pollution, deforestation and unpaid time spent collecting biomass fuel. In 2017, an estimated 600,000 Africans died due to indoor pollution.

Fulfilling household responsibilities requires more time and must be done within restricted hours when electricity is unavailable. These responsibilities often fall on women and children and prevent their participation in the formal economy or pursuit of education that could encourage later participation. African economies suffer because of these barriers to participation. Industrialization is key to economic growth in Africa. To industrialize the continent, energy in Africa needs to be sustainable and easily accessible to all.

Improving Energy in Africa

Africa already has significant capacity for improvements in energy. Much of this potential lies in renewable energy sources. For example, one-fifth of Africa’s current energy is produced using hydropower. Hydropower, however, is only being utilized to one-tenth of its potential. Along with hydropower energy, solar, biomass, wind and geothermal energy all show promise for further development.

There are several existing avenues for further development of energy in Africa. As a shift toward renewable energy is gaining momentum across the globe, largely due to its environmental advantages, the resulting new and affordable technologies may provide the needed boost to further industrialization in Africa. Ensuring that renewable energy innovations reach Africa and are suited to build on current capabilities is essential for economic growth throughout the continent.

The 2020 African Economic Conference (AEC)

The African Development Bank (AfDB), the Economic Commission for Africa and the United Nations Development Programme jointly hosted the 2020 African Economic Conference (AEC) from Dec. 8 to 10. The conference facilitated presentations and discussions among leading academics, early-career researchers, policymakers and decision-makers. The central theme of the conference was how to ensure continued sustainable development in Africa amid the challenges posed by the COVID-19 pandemic. Specific topics included the role of governments and private institutions in regulating and developing African economies, adjusting goals and methods to conditions brought on by COVID-19 and preparing Africa for future resilience in crisis. The conference has been held since 2006 and helps to maximally inform efforts toward development in Africa, consider the challenges unique to local economies and emphasizes the importance of sustainable and renewable energy.

The New Deal on Energy in Africa

The AfDB Group is leading the New Deal on Energy in Africa to help develop energy in Africa and achieve universal electricity access for Africans by 2025. Its strategy is to build awareness of barriers to economic development, secure innovative funding for energy developments and strengthen energy policy and regulation. According to the AfDB, without stable energy in Africa, the U.N. Sustainable Development Goals will not be achieved. The emphasized ideal for energy in Africa is renewable; nevertheless, efficient and less expensive methods of energy production can quickly work to stimulate the economy. Gas will be an important transition fuel as efforts are made to establish cleaner, maintainable methods.

Electricity Access for Economic Growth

Improving energy in Africa means that the continent needs reliable power grids and universal access to electricity to further economic stability. The path to sustainable energy in Africa is evolving thanks to new momentum derived from the global and continental potential for renewable energy development. Keeping energy progress in mind throughout pandemic response efforts is a goal of international organizations as they work together with Africa toward economic growth across the continent.

Payton Unger
Photo: Flickr

Solar Energy in UgandaAs of 2016, it was estimated by the World Bank that only 26% of Uganda’s population has access to electricity. In urban areas, the percentage is higher, at about 60%. However, in rural areas, the amount of people with electrical access is limited to only 18%. The use of solar energy in Uganda hopes to bring increased access to electricity, specifically in rural areas, as well as make electricity more affordable for the population.

What is Solar Energy?

Solar energy is energy from the sun that can be used electrically or thermally. It is a renewable energy source that provides a sustainable and clean alternative. Through photovoltaics (solar thermal collectors) solar power is collected and then converted into an energy source that can be used as a heating system or for electricity.

Solar Energy Fighting Poverty

Solar energy in Uganda can bring poverty reduction. It is an affordable and reliable source of energy that rural areas can depend on. It can also produce jobs within the community. Since solar energy makes household chores easier, women and girls have more time available to search for jobs or pursue education and development opportunities. Overall, renewable energy is a valuable component to provide electricity access, financial empowerment and sustainable economic and social development.

European Investment Bank (EIB)

With solar energy, more of the country will have access to electricity. The European Investment Bank (EIB) is using its finances to help people without electricity in Uganda. As it is the rural communities that are more affected by a lack of electricity, programs are more focused on maintaining reliable resources for those areas.

Through EIB’s efforts, more than one million people in Uganda will have access to electricity for the first time, making for easier cooking and the ease of many other household activities. Families will also be able to save money since the household will not be using as much kerosene, candles or charcoal. Indoor pollution will decrease from less kerosene usage and fire hazards will be reduced.

Reliable electricity has many benefits, with access to health opportunities being one of them. With access to phones, radios and televisions, farmers will be open to markets that can increase their income. EIB has given a loan of $12.5 million to build 240,000 solar home systems throughout Uganda, increasing economic and social opportunities.

Sustainable Energy for All (SEforALL)

Sustainable Energy for All (SEforALL) created an agenda that was adopted by Uganda’s government to help provide an increase in accessibility. The goal is to provide more than 99% of the population with access to electricity by 2030 and improve the energy efficiency of power users by at least 20% by 2030. SEforALL plans on accomplishing this ambitious goal by building energy savers throughout the country in households, industries, commercial enterprises and more.

It is clear that Uganda is in need of more access to electricity throughout the nation. Solar energy is one of the sources that hopes to increase those numbers. There is still a lot to be done to raise access to electricity from 26% to 100%, but with efforts from Sustainable Energy for All and the European Investment Bank, the situation looks exceptionally hopeful.

– Sarah Kirchner
Photo: Flickr

Electricity in VenezuelaOn March 7, 2019, Venezuela entered the worst power outage in the country’s history. Plunging all 23 states into darkness, the blackout lasted over five days in majority of the country. The economic losses triggered by this event exceeded $800 million and led to the deaths of an estimated 46 people. Electricity in Venezuela has since become a huge cause of concern for people.

Blackouts in Venezuela

Regrettably, this blackout was not an isolated incident, although it was the longest. Blackouts have become a routine aspect of Venezuelan life, dating back to as early as 2010. In a country where 96% of the Venezuelan population lives in poverty, these blackouts serve only to exacerbate the struggles of a vulnerable population. They strip people of access to basic necessities like water, food and fuel. Their root causes are often unclear although the key contributing factors are widely agreed-upon.

Understanding the Power System

In 2007, Venezuela’s private power companies were nationalized and transformed into one state-run monopoly known as Corpoelec. The company is underfunded, rife with corruption and unable to recover its own operating costs. The factors creating this untenable situation for Corpoelec date back even further to 2002 when national electricity rates were frozen. In Venezuela, “consumers pay only 20% of the real costs of producing power, delivering Venezuelans the lowest electricity prices in Latin America.” The drawback to these low rates is that energy is extremely overused and that Corpoelec is unable to generate sufficient revenue to fund infrastructure investments or even basic maintenance of its facilities.

Overdependence on Hydropower

The aforementioned problems are exacerbated by Venezuela’s near-complete reliance on hydropower from just one dam. The Guri Dam located in the eastern state of Bolívar accounts for 80% of the country’s electricity production and its systems are woefully neglected. The dam currently operates at a capacity considered unsustainable, “jeopardizing the machine room in the case of a flood,” according to experts. In a region where flooding is common, this is cause for concern.

Whereas other countries that rely heavily on hydroelectric power like Brazil and China have made large investments into other forms of energy, Venezuela’s ability to shift away from hydropower is crippled by underfunding, a lack of engineering power from within the country and corruption.

Corpoelec has stagnated progress as well. The company, “paid millions of dollars in no-bid contracts to political connections,” to maintain its dominance. Projects to build new dams and other forms of electricity production like thermal or wind have routinely been stalled due to a lack of funding and inadequate staffing.

The Cause of the Blackout

The March 7 blackout that heavily circulated the news was caused by a system failure at the Guri Dam. It was initially painted as a terrorist attack by president Nicolás Maduro, who tweeted, “The electrical war announced and directed by the imperialist United States against our people will be defeated.”

The Venezuelan president’s claim was that the U.S. had caused the power outage through a cyberattack on the hydroelectric plant. However, engineers who worked on the dam later clarified that the plant’s electronic monitoring system is not actually connected to the internet, proving a foreign attack to be an unlikely root cause. The plant has been poorly maintained and neglected for a very long time. In actuality, failure to properly manage the electricity grid may have caused a fire has been deemed the likely cause, and unfortunately, there is no quick-response system in place at the facility to protect its systems from damage.

The Future of Electricity in Venezuela

To ensure the return of consistent electricity to the people of Venezuela and protect against future blackouts, massive overhauls would be beneficial. However, such agendas seem unrealistic given the current economic and political climate in the country. Rather, a focus on increased upkeep and basic maintenance of power plants offers a more realistic path forward. This requires access for NGOs to bring in engineers and consistent revenue toward infrastructure repair. Without this basic funding and commitment from the government, the Venezuelan people will continue to suffer through blackouts.

– Scott Mistler-Ferguson
Photo: Flickr

Energy in EgyptThe poverty rate in Egypt rose to 32.5%, or 32 million people, in 2018. Energy use is rising in Egypt by 6.5% per year, but a disproportionate reliance on finite gas and other conventional energy resources has placed the future of Egyptian energy sustainability and environmental goals at risk. Under the Egypt Vision 2030 initiative, the country has recognized an important need to reduce carbon emissions. This, along with the country’s abundance of sunlight and wind, means that Egypt could very well move toward dependence on renewable energies. This is increasingly important as the growing demand for electricity has exposed the lack of access in Egypt, especially in rural areas. Lack of access to electricity is an issue that the world’s poor face and renewable energy in Egypt could be key to alleviating poverty in the country.

Shifting to Renewable Energy

The Egyptian Government began its shift toward energy security through increased renewable energy in 2014, when it partnered with the World Bank to institute energy sector reforms and attract $2 billion worth of investment for renewable energy sources. Before that, the government had large, inefficient fuel subsidies that outweighed expenditures on social protection, health and education and did not even target the Egyptian poor. This time period also saw frequent power shortages, which contributed to overall social unrest.

By committing to generating 20% of electricity through renewable energy sources by 2022, the Egyptian government showed a comprehensive commitment to energy sector reform. This has helped to create a welcoming political and economic environment for private sector investment, strengthening the shift toward renewable energy in Egypt, which creates the spillover effect of helping the country’s poor, whom energy shortages are likely to more severely affect.

The Benban Solar Park

The result has been several large deals with international banks to finance projects like the Benban Solar Park, which will be the largest solar project in the world once completed. The government received over $650 million in funding from the International Finance Corporation (IFC), a member of the World Bank Group, to construct the 13 solar power plants that are part of the project. This new initiative will provide power to more than 350,000 Egyptians and generate more than 6,000 for building greater renewable energy in Egypt.

Other Benefits of Energy Reform

The partnerships with the World Bank and the IFC have other benefits, like freeing government spending to go toward social initiatives. By instituting energy reforms, the Egyptian Government was able to double spending on social protection for the poorest 20% of the population. So, while projects like the Benban Solar Park will themselves contribute to a cleaner, more efficient energy security that will benefit those living in poverty, the means by which these projects are funded also enable the government to focus more of its spending on alleviating poverty.

Energy Reform and Poverty in Egypt

The Egyptian Government has partnered with international institutions like the World Bank to reform its energy sector. Past overdependence on gas and oil along with inefficient fuel subsidies placed Egypt’s future energy security at risk while exacerbating problems the nation’s poor faced daily. The country has shown a commitment to clean energy initiatives, which benefit Egyptians living in poverty in two main ways. First, they increase access to power and electricity. Many of those living in rural communities do not have consistent access to electricity, so this reform directly benefits them. Additionally, it benefits the impoverished indirectly by freeing up government spending for increased expenditure on social protection programs. Thus, the future of renewable energy in Egypt is bright and it has the potential to alleviate the struggles of millions of Egyptians.

– Connor Bradbury
Photo: Flickr