During the recent Global Off-Grid Solar Forum, we sat down with Andrew Herscowitz, Coordinator of the U.S. Agency for International Development’s Power Africa, to discuss the future of the initiative’s pioneering market-based effort to scale energy access in Sub-Saharan Africa. Power Africa turns 5 years old in June.
Even with a new America-first political reality in Washington, D.C., Herscowitz expressed full confidence in the future of Power Africa, pointing out that funding for fiscal year 2017 was passed by the U.S. legislature, with the president’s 2018 fiscal request to Congress also including continued funding.
“Power Africa is an effort that the new administration has continued to support,” he told Power for All. “Energy access is part of the new National Security Strategy (NSS), and Power Africa advances that part of the NSS… Our work continues and we continue to remain on track for achieving our goals.”
The rapid evolution of the sector, however, means that Power Africa needs to evolve as well, Herscowitz said, pointing to two growing focus areas: 1. supporting the movement from portable lighting to larger energy systems, including mini-grids, and 2. scaling the market for productive use appliances.
“The ultimate goal is higher levels of energy access, beyond basic lighting. What we realize: simply selling people electrons is likely not a viable business model on its own. We have to figure out how to bundle services and rethink business models to include productive use,” he said. “The next market that needs a lot more hand holding is the micro-grid sector and we will give it an increased focus to see if this is a solution that in the long-term is transformational and ready to take off.” (Also, see his recent perspective, “Hey Discos! (That is, Electricity Distribution Companies)”.
Power Africa is already funding some mini-grid companies, is working with the U.S. National Renewable Energy Labs (NREL) on a Quality Assurance Framework for mini-grids, and is also supporting a new matchmaking platform to connect mini-grid investors, developers and vendors. In addition, Power Africa and Mastercard recently announced the Smart Communities Coalition, a public-private effort to improve the delivery of essential services to refugees and host community members through enhanced coordination between public and private entities and strategic implementation of technology.
“In part, the impetus behind Power Africa’s participation in the coalition was that we wanted to give micro-grid companies a controlled environment to test their business models. Refugee settlements can facilitate that because populations can be more densely populated. Companies can tweak models on what's working, and what's not, and then move from a controlled environment to the broader market.”
The new coalition reflects Power Africa’s focus on greater collaboration, Herscowitz said.
“We’re happy to share credit, because we have to work closely together and not compete if we want to achieve impact. We’re on the phone with partners on a daily basis, collaborating at both the headquarter and country levels.”
Another example of that collaborative vision involves super efficient appliances. Power Africa and UKaid recently relaunched the Efficiency for Access coalition, which includes other development partners and private foundations to bring together a range of programs and support mechanisms to accelerate energy efficiency in clean energy access efforts, driving market scale to super-efficient technologies, supporting innovation, and improving sector coordination. As part of the new push, UKaid plans to spend £18 million over five years on the Low-Energy Inclusive Appliances (LEIA) program to accelerate the availability, affordability, efficiency and performance of a range of appliances and related technologies suited for developing countries.
“There is tremendous demand for appliances. Once people get a taste of electricity to do the things that we take for granted, their demand for other appliances increases,” Herscowitz said, noting that refrigeration is on the top of that list.
During the off-grid solar forum, Power Africa, UKaid, and USAID’s Scaling Off-Grid Energy (SOGE) and the Global LEAP initiative announced the winners of two off-grid refrigerator innovation prizes, with SunDanzer winning both prizes for greatest efficiency and overall value, and receiving a total of $400,000. This is one of several companies that have been awarded funding under the Grand Challenge, and the partnership plans to launch similar challenges for other appliances in the coming year.