A Real World Challenge for STEEMIT

in africa •  last year

Electricity in Africa

In my introductory post, I mentioned that one of my real interests regarding cryptocurrencies is the ability to access and utilize the same to help address real world problems. See what you think about this.

Africa’s population is rapidly approaching 1,000,000,000—yes, 1 billion! And, that figure is expected to double by 2050. Right now, two-thirds of the population does not have access to electricity; Africa truly is the “dark continent”.

Nature of the Challenge

Think about this for a minute. Ten years ago or so in Kenya, there were more cell phones on a per capita basis, than in any other country. Overnight, the Masaai, Samburu (just to name a couple of tribes) in the remotest parts of the country could communicate with family, friends and relatives who had moved to urban centers seeking employment and a better life. So, how did they re-charge the phones?

Imagine, if you will, all the schools in rural African communities that have no power; but, they have been donated laptops to give the students access to a broader world view.

Without electricity, the cell phone, the laptop, become just other useless, Western inventions that cannot be effectively utilized in the Third World. But, there have been and continue to be dramatic changes; changes that will help turn this around.

Impact

The absence of electricity stifles economic growth and development, has a dramatic adverse impact on the provision of adequate health and education, and condemns masses of people to lives of unending poverty. (Importantly, Sustainable Development Goal (SDG) number 1 is “eradicate extreme poverty and hunger.”) For the most part, the government-owned public utilities responsible for providing power are terribly inefficient, bloated, and corrupt entities that are simply unable to provide reliable, affordable power.


What to do?

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It is a problem, solar power and wind power need to be captured and used in Africa @beantownboy

Africa does not have the water and the dams that are there not many more have been raised to my knowledge in the past few years.

All new homes should be built with solar energy which we have plenty of, it is the initial outlay of funding that will be a huge problem for the poverty stricken continent.

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I agree with you that solar and wind need to be rolled out in Africa, along with other renewable energy technologies which fit the available resources (and I wouldn't be staking my business in real life on that idea if I didn't believe that! Just to be a bit persnickety - there are many countries in Africa which have excellent hydropower potential as well as existing capacity, but more than a few of them need to improve their capability to manage those resources. Smaller hydropower solutions can work well, as can wind, solar, biogas and other renewable technologies, where the supply addresses the demand in a sustainable way. One of the constructs we have to get away from is the idea that only a state-owned utility can supply communities with electricity. The US grid started out as a collection of microgrids that eventually overlapped each other, allowing the creation of interlinked networks and power pools. There are a lot of clever people out there doing clever things to make similar solutions a reality in Africa.

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When I worked at Deloitte Consulting we did a project for Eskom. That big dam in Congo can supply the whole Africa with power.

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We hydropower geeks call Inga (which could supply as much as 45GW to Africa - that's more than South Africa's entire installed capacity) a hydropower engineer's wet dream. Just saying. It's been studied to death for over half a century, and every engineering firm with bravado wants a piece of the work that would result if the project was financed.

I've been involved in a number of initiatives around getting Inga going, including an international roundtable convened by the African Development Bank, and the key problem is bankability of the project in a country which is so unstable. To be bankable, an infrastructure project needs to have creditworthy offtakers (customers). The main customers for this project would be SNEL (DRC's utility) and other regional electric utilities, all of which are in precarious financial situations, so not considered creditworthy.

That now includes Eskom, although in the 1990s Eskom was much stronger financially.

It's unfortunately too difficult for financiers in the current financial world to structure a project which would supply multiple private sector clients (who couldn't possibly take 45GW anyway) who might possibly be creditworthy, and to provide the financial guarantees and supports to the utilities which could buy Inga-generated electricity, which would be REALLY cheap to generate, probably just a couple of US cents/kWh. That would determine the selling price to customers, who would pay the running costs plus a reasonable margin for the energy they would buy.

If you consider hydropower to cost at least $1m/MW, or $1bn/GW, installed to build (just for simple numbers - all in, and including the long transmission lines, the investment cost would be higher), you'd be looking at a minimum of $45bn for the project. That's beyond the capacity of the multilateral development banks to finance, the DRC doesn't have that money and can't raise it and the Southern African Power Pool, as a potential offtaker, runs on about $5m a year in revenues.

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You HAVE been reading my files!

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😂😂

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So sad, why doesn't some big investment bank from America come to the party? How much of the wattage do you think will survive the long journey?

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It's all about the ability of customers to pay - that big American investment bank (if there is one with $45bn to invest) wouldn't be able to recover its investment through revenues...from those customers which can't pay....

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Who will be the customers?

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The primary customers would be electricity utilities in the region. Most of them are technically it really bankrupt and wouldn't give the lenders any comfort they'd be able to pay for the electricity they would buy over the years.

At one point there was an initiative called Westcor for five utilities (from DRC, Angola, Namibia, Botswana and South Africa if memory serves, which it might not) to build DC transmission lines through a Western Corridor (hence the name) to bring Inga electrons to those utilities. It didn't succeed for reasons I won't go into here, but in part because the proponents didn't follow the basics of infrastructure project finance. A real pity - in many ways it was a good idea.

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And one of the biggest challenges, which cryptocurrency could be instrumental in addressing, is that the customers of those customers (i.e. people buying electricity from their electricity company) aren't considered "creditworthy" under the current conventional financial system. Until the actual customers can be considered able and willing to pay for the electricity they consume, new projects will continue to be difficult to finance under traditional infrastructure project finance mechanisms, and utilities will be difficult to finance under corporate finance as the metrics for repayment to the lenders just won't be there. There are so many ways crypto could address this combination of challenges, in part by changing the payment ecosystem that electricity consumers live in.

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But they would not let it run, Africa loves big projects on paper...how i wish we can see the enormous potentials wasting away in Africa.

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What are some of the other ones would you say? Thanks for connecting on here. I hope you have a WONDERFUL day!! 😝 😛

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Hello @kiligirl; have you been reading my files?

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😏😏

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Have you been reading mine? 😉

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Great article, thank you for sharing. One of the largest issues that I see is saying "Africa" is like saying North America (Mexico, U.S., and Canada). Too many countries and bureaucracies to deal with for one solution to a problem deal with one issue, that being electricity. However, I do believe that cryptocurrencies could in-fact break down some barriers for each of these countries or regions with like-minded goals.

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You're so right, @clarkwb02. Africa has 54 sovereign countries, many still untangling their colonial legacies after decades of political, but not economic, independence. That's a lot of different governance structures.

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They would not like Cryptocurrency to run, because of its transparency.....but soon the future will tell

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Hello @clarkwb02; you are absolutely right. The common ISSUE that, basically, all African countries are facing is inaccessibility (by the vast majority of their respective populations) to electricity--which severely constrains economic development, has an adverse impact on health and education, etc. While the SOLUTIONS need to be tailored, there are, nevertheless, some common threads. First and foremost, there is an absolute need for private initiative and capital; governments don't have deep enough pockets or visionary thinkers / leaders--and, too many vested interests. Second, solutions must address the issue of affordability and payment systems that "fit" the economic environments and customer bases (a real potential role for cryptocurrencies and blockchain technology here I should think). Finally, any solution must be both commercially and financially viable--otherwise, it is doomed to failure.

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Absolutely; cost is a real challenge. But it is beginning to be addressed in many innovative ways. Also an issue is the "intermittency" of renewable technologies--ie, what happens when the sun doesn't shine or the wind doesn't blow! Storage costs are still high, though they are coming down. We will definitely see a future in which cost competitive renewables can be used on a 24/7 basis--in Africa!

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On intermittency, spot on. As we know, the clever inventive people out there are coming up with clever inventive solutions to get over storage and transient issues. And I love your vision for a future Africa where we have cost competitive renewables used on a 24/7 basis!

Seems one of the critical elements to a lasting, sustainable solution is to bring in private sector knowhow to deliver increasingly affordable renewable energy solutions where the economics work. One of the challenges you allude to is customers' ability to pay. If they're poor, we assume they can't pay anything. Yet they have cell phones. They might not be able to pay a big monthly bill to a utility, which might not even get that bill right, but it's likely they'd be able to pay prepaid blockchain-enabled micropayments, possibly using apps on those cell phones they already have.

This would get around the issue of how to finance traditional grid extension (big generation projects attached to big transmission lines) and would enable the rollout of commercially viable microgrids, for which the technology is already available.

Affordability for the consumer AND the supplier leads to a sustainable commercial relationship.

Hope I haven't stolen your next post! 😉

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You can't eat a cellphone. And you can't eat prestige.

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And a cellphone can't buy you love. Thanks to the pointless Kardashians and Paris Hilton shlebs out there, many young people have the impression that prestige buys you fame buys you wealth buys you love. Ah well....

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You know where I got that saying from?

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Nope - please enlighten me 😊😊

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At university in America the staff striked and they said that. struck doesn't sound right. it was the staff of the cafeterias. the school's admin were like, the fact that you're working at Harvard is compensation in itself because itself because you can say you are working at a prestigious institution. So they said on their protest boards, the famous words I said to you.

Does my profile avatar on here look fat or like a bot?

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Thanks for the Harvard background.

And your avatar? Like a cute, fat bot, @pjcswart 😉

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No, but maybe we should jointly start a business!

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Now THAT's an inspired idea!

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The problem is not lack of knowledge

The problem is these leaders are making millions of dollars by the giant corporations to keep their people impoverished.

The World Bank wants Africa poor.

So the billionaire corporations do not have to pay them Market prices for the resources.

Love to examine it,Waiting For additional new Update and that i Already browse your Recent Post its nice Thanks. a lot of appreciated regarding swing this explicit realities. I primarily with the goal merely|that you just} will demonstrate you we have a tendency to essentially simply observe your website and My cherished one even so we have a tendency to discover it genuinely fascinating and in addition compelling. could not clutch comprehend to require in numerous your posts.

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Aahhh, thanks for the note (and the vote); not quite sure I understand it!!

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no sir its my duty

Big Challenge for humanity!

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But one that must be addressed!

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then look to BARMA, SYRIA, IRAQ, FALASTINE, KASHMIR ? did you know about them?

The problem must be solved from the inside out. Little wars are what is really causing this chaos.

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I also think private initiative can be a big help.

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That is completely true, both should be considered

Great!

Really happy to see fellow Steemians seeking solutions to real world problems using Steemit/Blockchain as the vehicle to do this.

I'm following, and this is my current project if you wish to take a look.

Welcome to the community!

Asher @abh12345

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Thanks and very, very interesting project! Education is absolutely, unequivocally, critical for the development of any society.

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Yes indeed, I hope we can do it justice!

We need to mobilize and we need to help them. We are all people, color does not matter

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Yup; we need to help them help themselves!

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Yes, yes

I live in Africa, Nigeria to be precise and I think our government doesn't want the citizens to be informed. I believe philanthropists are the ones who could help out. As far as the government of most African countries is concern, they hust want to live for themselves not the people.

Congratulations!!


As a Team South Africa member, and due to the high quality of your post, you have been chosen to receive a well-deserved upvote from @mzansi 🇿🇦

Keep up the great work!! 😁

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Thanks for this post! What a great way to help people! I guess solar power could help. I think many African countries are also suffering from the economic phenomenon of Dutch Disease where their currency becomes overvalued and exports suffer.

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It needs years to be better..

Some say poverty is a logistical problem and not a resource problem.

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Thanks for your comments; don't get me started!!

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Sounds like you may have some interesting opinions about this, wouldn't mind hearing them...

how can release this problem ?

Congratulations @beantownboy, this post is the forth most rewarded post (based on pending payouts) in the last 12 hours written by a User account holder (accounts that hold between 0.1 and 1.0 Mega Vests). The total number of posts by User account holders during this period was 1622 and the total pending payments to posts in this category was $4497.62. To see the full list of highest paid posts across all accounts categories, click here.

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Hello, my name is Nadine and I am new on Steemit. Would be very nice if you could check out my post and maybe you want to follow back. Thank you.
https://steemit.com/travel/@leo-tmp/explore-the-beauty-of-northern-thailand-chiang-mai-my-travel-diary
And I really love your post. Great!

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Thanks so much!

Hmmmmmm, well said

Please...what is wrong with electricity power in Africa, why are so blind to the positive effect of uninterrupted power supply. electricity is like the real foundation that growth and development rest upon...even the cost of buying a solar system is enough to set one aback ....Africa needs help on this, we really do.

My parents alwys teach me one thing
Be corporative for others asmuch as possible
But i read this post and i came up with a solution that population is really big there so hundreds of people are not enough to develop something new there

Those want to help them then first of all, they need create awareness among their hoals and motivate them to move aheads slowly but not stop anywhere
That's important for everyone to take participate for the development of their own country. So create eagernes and see the visons and work on them to achieve

Love to examine it,Waiting For additional new Update and that i Already browse your Recent Post its nice Thanks. a lot of appreciated regarding swing this explicit realities. I primarily with the goal merely|that you just} will demonstrate you we have a tendency to essentially simply observe your website and My cherished one even so we have a tendency to discover it genuinely fascinating and in addition compelling. could not clutch comprehend to require in numerous your posts.

steemit is a great place where people can change the world together. Not all of it at once, but piece by piece. and this article @beantownboy is giving the great direction for our efforts

Following you rightaway, for your well put together post. Solution to power problem is decentralized electricity that can be achieved with blockchain. Follow us @trender to learn more about upcoming project focusing on creating solutions in Africa with the power of blockchain.

Its a great task and challenge that we must all address...africa nees to rise and be the best we can ever be..thanks to God steemitghana is gradually being widen...thanks for your corncern for africans @beantownboy

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