Ten years of energy transition and energy access in the Global South
17 November 2021
Changes and innovations in energy transitions in the Global South over the last decade, written by Senior Research Associate Xavier Lemaire.
In 10 years, there has been a complete change of paradigm in the rural and urban electrification field in developing countries. The unrealistic goal of connecting the rural and urban population of developing countries to the central grid has given way to the concept of hybrid electric systems combining stand-alone systems, micro and mini-grids alongside the main grid with a mix of renewable and conventional sources.
This shift has also been accompanied by a significant increase in research on improving energy access through low carbon infrastructure. ISR’s research on this theme has also grown rapidly in the past ten years, including through involvement in major programmes, such as Climate Compatible Growth and the Understanding Sustainable Energy Solutions (USES) in developing countries programme, under which STEPs – focused on thermal energy services – SAMSET – focused on energy transition in African municipalities and MECON – focused on energy efficiency in Southeast Asia – were funded.
Now, and all around the world, centralised renewable sources like large-scale wind and solar farms are competing with the cheapest conventional sources, such as coal. This is linked to the constant decrease in the cost of solar and wind which is the logical consequence of the increase of manufacturing capacity and of learning experience resulting from regulation and contracts to support renewables. One of the aims of the REEEP / Sustainable Energy Regulation Network, which was initiated by the late Dr Gill Owen, was to help disseminate and promote these policies.
Economies of scale and learning curves will continue and will contribute to further cost reductions not only for renewable energy generation, but also storage capacity. This will help to guarantee better energy security in the long-term for cash-strapped developing countries against high prices and the fluctuation of prices of conventional sources. Indeed, once subsidies are removed, with proper funding, specific incentives, contracts and auctions and carbon taxation, renewable energies can displace coal, as has happened in the UK.
Spectacular disruptions in the energy landscape have also happened with decentralised sources. Mini and micro-grids are now part of energy plans and policies in many developing countries, as they enable the rapid electrification of communities which would have otherwise remained out of reach of the conventional grid for decades.
Stand-alone systems, such as small solar photovoltaic systems, have not only benefited from the reduced cost of solar panels, but also from technological innovations which have enabled the remote control of solar systems and electronic payments. Such innovations have helped to reduce maintenance and transaction costs, saving renewable energy companies the logistical headache of sending technicians to remote places to diagnose system failures and collect payments. Reduced generation costs, combined with efficient technologies, have also enabled the provision of more energy services for domestic and small productive uses. With the progress of the miniaturisation of electronics and the advent of LEDs (Light-Emitting Diodes), pico-photovoltaic like solar lanterns are now widespread and millions of solar lanterns are sold every year.
Another major change has been the emergence of renewable energy service companies based on innovative business models which, instead of selling a product (i.e. the solar home system), sell the service (i.e. the electricity). In this way, companies can reach large segments of the off-grid population. Alternative business models where solar companies work hand in hand with micro-credit companies have also been successful as they remove the barrier associated with the up-front cost of solar systems. The STEPs project examines whether these innovations in electrification can be replicated in the provision of thermal energy services.
In a field traditionally dominated by engineering considerations, a greater emphasis on end-users’ needs and on sustainable business models has been, alongside a favourable regulatory environment, a key shift in helping to scale up the dissemination of small-scale renewable energy technologies. Combined with the technological innovations mentioned above, better marketing with products designed, not just in labs, but tested in the field with feedback from local communities has been essential to the adoption of small renewable technologies and in overcoming the accumulation of failed projects in developing countries. However, the large-scale dissemination of small-scale solar in the Global South also raises a number of challenges, including how the vast amount of electronic waste generated by the multiplication of small systems in remote areas will be recycled. Furthermore, due to demographic growth and the COVID-19 pandemic, the achievement of universal access to modern energy services by 2030 appears unlikely, especially in sub-Saharan Africa.
One final area of research under the ISR theme on improving energy access and resource use in developing countries relates to the spectacular growth in large-scale renewable technologies and the associated land use changes. Just as with the shift in land use from food to bioenergy, this land use change has the potential for conflict – particularly with local communities. It is an open question whether decentralised sources will leave more space for public participation and whether energy transitions will lead to the democratisation of the energy sector. While the current energy transition undoubtedly represents a huge opportunity to significantly increase electrification rates and the reliability of energy services in urban and rural areas of the Global South, examining the unintended consequences remains an important area of research at the ISR.
Photo credit: Liviu Florescu, Unsplash