Green off-grid systems (2)

Clean electricity at last for more than a billion people?

Text: Birgit Scheuch, 22.06.2022

How can the supply of affordable, reliable and modern energy to the world’s population be realized by 2030? By taking a very close look and setting clear rules.

Decentralized, off-grid and sustainable energy systems are now considered the silver bullet to achieve the UN Sustainable Development Goal #7. The pace of development is also clear to see in some of SMA Sunbelt Energy GmbH’s ongoing projects. The company focuses on innovative off-grid, hybrid and battery based projects and helps local distributors set up their off-grid businesses.

Project manager Heiko Stieber has commissioned a number of mini- and micro-grids in Africa and the Caribbean and is currently involved in a project in Senegal designed to provide around 330,000 people in more than 400 villages with access to electricity.

“There are regions here where it’s impossible to access the grid – nature reserves or areas that are simply too isolated,” says Heiko Stieber. “We are installing 78 off-grid systems in these areas, re-purposing in-situ shipping containers originally used on building sites. The photovoltaics systems provide protection against the sun, and part of the shipping containers will be used as commercial space. We are currently training up engineers from the Senegal National Electricity Agency (SENELEC) so that they know how to operate the systems.”

Since communities left out of current electrification plans are voicing their discontent with a cry of “No power – no vote!”, the Senegalese government is finding itself under pressure to act. For Stieber, it’s clear that the pace of electrification is set to increase rather than decrease.

„Our off-grid systems in Senegal are designed to be expanded.“

– As project manager for SMA Sunbelt GmbH, Heiko Stieber is helping to introduce off-grid systems in Africa and the Caribbean.

Planning and implementing off-grid systems are not easy tasks.

The term “mini-grids” might sound cute, but setting them up is seriously tricky. The engineers first have to establish the level and type of energy demand.

If just a handful of families need electricity only every now and then and for a foreseeable period, a solar home system is likely the best solution. A regional health center, however, might need only a small amount of energy but cannot afford any interruptions to its supply. The best solution in such a case is a solar hybrid system in which a diesel generator makes up for the energy that a PV system with battery cannot deliver at night or when it’s raining. The best solution for an entire district could be an upgradable mini-grid – although, again, choosing the right site is crucial here.

Philipp Blechinger, who heads the Off-Grid Systems research field at the Reiner Lemoine Institute, and his team make up for the lack of data by conducting empirical research and field studies and developing open modeling tools for planning off-grid systems and electrification strategies. “In 2021, for example, as part of the PeopleSun project, we surveyed 5,000 households across Nigeria to gain a better understanding of their energy requirements.”

„Electrification and climate protection need to be more closely dovetailed if we are to achieve the sustainability goals.“

– Dr. Philipp Blechinger heads the Off-Grid Systems research field at the Reiner Lemoine Institute.

It’s a matter of will – energy policy and obstructive regulations

„Our off-grid systems in Senegal are designed to be expanded,” says Stieber. “This means that they can be interconnected to create one big utility grid. Whenever these standalone grids expand to within five miles of the central utility grid, they have to be connected.“

But it’s precisely this “threat” of being connected that currently often hinders the expansion and upgrading of off-grid systems. Developers and investors are asking themselves what happens when the utility grid finally – if ever – reaches the region. In many regions, either there is no answer to this scenario or the official structures would put mini-grids and off-grid systems at a disadvantage. And it’s precisely these kinds of risks that are putting investors off.

This is why all the major studies conducted in this area recommend making decentralized systems part of national energy policy, planning and regulation. This means overhauling obstructive laws that prioritize grid expansion and upgrade projects above all else and defining a procedure for the transitional phase. Whether continued autonomous operation, state supply contracts or compensation – anything is better than a forced shutdown.

Sustainable change – opportunities for a better life

The electrification of a community or region heralds a whole new era. When children’s ability to learn is no longer dependent on how much daylight is available, this increases their chances of gaining a decent education and proper vocational training.

Electricity for equipment and machinery that help make work easier boosts both the productivity and earnings of local companies. Lighting makes new working hours possible. Cell phones and other mobile devices – in combination with a reliable mobile communications system, of course – allow companies to reach out to more potential customers.

And whether it’s the disruption-free operation of medical equipment, well-lit operating theaters or refrigeration for medicines, electricity dictates how effectively hospitals and health centers can function.

A question of balance – trends in electricity supply and demand

Anyone who thinks, however, that access to electricity will improve the prosperity of the local community overnight is mistaken. Establishing a connection to an off-grid system is just the start, for a variety of challenges still lie ahead. Stieber explains the situation as it is now, saying, “Workshops and other companies have always done many things by hand. There are no electric tools because, obviously, there is no electricity.” But a micro- or mini-grid will eventually start paying for itself only when there are dependable off-takers for the electricity produced.

So does the answer lie in a form of start-up financing enabling, say, a carpenter or tailor to purchase equipment, expand the business and, at some point, pay wages? Could specialist know-how helping farmers to process their harvests in line with market conditions help to ensure that more money is generated in the region? It would of course be more cost-effective and healthier for families to simply replace their climate-damaging wood- or kerosene-burning fireplaces, but, without an electric stove, cooking with solar power is unlikely to be a viable proposition. And last but not least, who’s going to service and maintain the mini- and micro-grids? One option could be to train up crews of solar and grid technicians and, initially at least, to pay their salaries. Whenever all these issues are not factored in or managed appropriately, PV systems can become susceptible to damage and neglected.

In the description of a project launched by the German Society for International Cooperation (GIZ), these support measures are described in the section entitled “Productive Use,” whereby the aim is to provide ”training and access finance for small and medium-sized enterprises, smallholder farmers and households, ensuring that electricity is used to drive economic development and making the mini-grid business model sustainable.” The partners from the skilled crafts and small businesses sector are also supporting technical and vocational education and training measures for solar and mini-grid technicians. And as part of another GIZ-run project to support the development of mini-grids in Uganda, 800,000 homes in Uganda were kitted out with state-of-the-art electric cookers.

And that is exactly what Blechinger finds so exciting about his work. “We have to operate at a highly interdisciplinary level because it’s about deploying technological innovations under difficult social and economic circumstances.”

„Some developers are targeting small businesses and industrial users alongside residential consumers, to increase the average level of revenues and hence profitability. Others are financing appliances to boost demand, or even becoming off-takers.“

State of the Global Mini-Grids Market Report 2020

A question of money – billing and tariffs

For mini-grid researchers and practitioners alike, the central issue in any project concerns billing and payment. According to Stieber, “In places like Tiburon in Haiti, there are customers who have an electricity connection for light, some music and maybe a television. Their electricity bill might be somewhere in the region of ten dollars. Energy meters as we know them are not an option there because the price of renting a meter and the self-consumption of the meter itself are disproportionately high.“

This is why local operators are always developing new usage and payment models. For example, with EarthSpark, Sunbelt’s development partner in Haiti, customers receive a card that they can charge in the office. “They then insert it into the meter and use their energy credit like they would their credit on a phone card,” says Stieber, explaining the prepaid model. “But new concepts are being developed all the time, like a meter to which customers can upload credit via their cell phone.”

Ultimately, the installation of a system like this brings enormous social change – and, for Stieber, this change in mindset is actually the biggest challenge in these kinds of project. “People first have to understand new things. In Africa, we installed systems for bush hospitals where doctors always performed surgery with their chins on their shoulders because they had become used to doing their work with a flashlight clamped between their chin and shoulder whenever the generator broke down.”

But when the power is at last turned on, the difference is like night and day. As Stieber says, “Street lighting alone makes people feel safer and, as a result, boosts social interaction. You’re more likely to go out and meet people. That evening, the first time when electricity was generated by a battery and there was finally light, it was thrilling to see how the whole community was revitalized.”

Mini-grids are nothing new

Almost all centralized utility grid systems in use today started out as standalone mini-grids that then became increasingly interconnected over time. […] These mini-grid systems, which were introduced in the late 19th and early 20th centuries, were crucial to the early development and industrialization of most modern economies, including Brazil, China, Denmark, Italy, the Netherlands, Spain, Sweden, the UK and the U.S.

Mini-grid manual published by the ESMAP, 2019 Executive Summary

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Green off-grid systems (1)

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