Power out of Africa

On the face of it, the idea of Africa providing a model of sustainable energy development to the world seems an unlikely one. Eighty percent of the world's 1.5 billion people living without electricity live in Sub-Saharan Africa, according to the African Development Bank. The continent's scarcity of grid links would seem to be an intractable obstacle to Africa's goals of improving development and alleviating poverty. Yet, Africa possesses significant solar, wind, geothermal and hydropower resources that have only barely been tapped, and which give the continent the potential to offer different models of sustainability.

By ANDREA CHIPMAN

African countries have a huge opportunity to turn their energy infrastructure deficits into an advantage, both for the continent itself and potentially for the rest of the world. Renewable technologies that use wind and solar are the gateway to this opportunity, but much work still needs to be done. Africa is in many ways a blank canvas for renewables.

The lack of comprehensive grid connections means most Africans currently get their power from diesel generators at prices of around $1 per kilowatt-hour, compared with less than 20 cents per kwh for solar photovoltaic power, according to David Nickols, managing director of WSP Future Energy, a unit of London-based technical consultancy WSP Group.

"Because renewables [in Africa] are compared against decentralized diesel generators off-grid, the financials for renewables may well look attractive," he says.

At the same time, the huge potential offered by larger-scale projects will require new cross-border collaboration between African governments, multilateral institutions and industry that could, if successful, be a model for other regions of the world.

To be sure, both large and small renewable projects face many of the same obstacles in Africa: A lack of secure property rights; the absence of a comprehensive regulatory framework in most African countries; and pressure on governments to make their electricity self-sustaining, with prices charged matching the costs of generation. "The best thing the world could do for Africa is to set up a support system for the utilities," says Jeremy Connick, a partner with U.K. law firm Clifford Chance.

"If we simply say we aren't going to allow governments to give guarantees in respect of the payment obligations of these utilities until systems are reformed, countries don't develop, or use fossil-fuel-powered generators."

Meanwhile, markets continue to discount the risks associated with fossil fuels, assuming they are lower than those associated with alternative energy.

"In terms of pure political and economic power, conditions still favor investment in fossil-fuel-based technologies and businesses," says James Cameron, a founder and vice chairman of Climate Change Capital in London.

Improved legal and tariff structures could dramatically improve the climate for sustainable energy investments, but a focus on micro as well as macro projects is also key.

The Wall Street Journal Europe has investigated five approaches to sustainable energy in Africa, ranging from wind and solar energy programs, to hydropower. As well as a proposal to allow individual citizens to profit from their own sustainable behavior.

Harnessing Wind

Wind is in plentiful supply across Africa, with significant projects under development from Kenya to Cape Verde and

from Morocco, a former leader in wind projects, to South Africa, which earlier this summer rolled out a tender for renewable power projects that included up to 1.85 gigawatts of installed wind generation set to be delivered by 2030.

In East Africa, Kenya is developing the Lake Turkana wind farm, which is expected to produce 300 megawatts of new capacity by July 2012. Similarly, off the continent's windy west coast, Cape Verde's government has signed agreements for a more modest 28 megawatt wind farm, although the more consistent wind conditions on the island chain means the ratio of actual to potential output is 60% for the Cape Verde wind farms, compared with 34% in the U.K., according to Mr. Connick.

Wind energy has the advantage of being an effective source of power in small and large projects. For the medium-term, however, financial considerations could make it a second choice alternative energy source, according to Mr. Nickols, who notes that with Africa needing to import most goods for power generation, the towers for supporting wind turbines work out as substantially more expensive than solar panels, which are cheaper and easier to ship.

Solar Future

Virtually uninterrupted sunshine is one commodity Africa has in abundance. Now, a number of projects based in the Sahara Desert are trying to use this resource to the continent's advantage.

The biggest of these, the €400 billion ($550 billion) 12-member German-led Desertec Industrial Initiative consortium, is looking to fund a series of individual solar projects with the aim of supplying as much as 17% of Europe's energy demand by 2050.

The project has strong backing from leaders across Europe, with German Chancellor Angela Merkel leading the charge. In a message to the second Desertec conference in Cairo in November, Ms. Merkel praised the cooperation between Europe and North Africa and stressed the importance of diversifying energy transmission away from traditional sources.

Desertec works by concentrating energy from solar-thermal power plants in deserts and then using heat storage tanks to deliver power on demand, thereby compensating for the fluctuations of photovoltaic power and helping to stabilize the grid.

The consortium already has two plants in operation in Morocco and Egypt. Morocco hopes to upgrade its existing transmission line to Spain and install 2000 megawatts of solar power capacity to supply both its own needs and to tap into the lucrative European export market.

For solar, like wind, the main challenge to overcome is the absence of a coordinated regulatory and legal framework, such as guaranteed feed-in tariffs, power purchase agreements or investment guarantees to underpin investment in the technologies. Desertec seeks to create a single legal framework that can be adopted by many different countries.

Ultimately, solar backers say, costs are likely to decrease rapidly as more power plants are built and technological progress continues, allowing Saharan-powered solar energy to be as competitive as fossil fuels in less than 10 years.

Water Works

Hydropower is a large-scale solution to creating sustainable energy. Tapping into Africa's vast river systems opens up a world of energy possibilities.

The Grand Inga Dam project, which plans to harness the enormous potential of the Inga Falls on the Congo River in the Democratic Republic of Congo, is perhaps the most high-profile example.

The project could produce as much as 39,000 megawatts of electricity, according to the London-based World Energy Council, more than one-third of the continent's current electricity output. Two other small power plants have already been built on the site and a third is currently in the design phase. In addition to exporting energy to southern Africa, the project, which is expected to cost as much as $70 billion, could transmit energy as far as Egypt and Nigeria, and potentially to Europe via high-voltage lines.

Political instability will make security an overriding challenge. Yet a clear and coordinated legal framework and strategy for refurbishing transmission lines to export Grand Inga's power are the main preconditions for the project to gain sufficient financial backing. Grand Inga has huge potential but will need strong leadership to achieve it, according to Boris Martor, head of the African group for U.K. law firm Eversheds, which has advised DRC state-owned utility SNEL, since 2001.

"Right now, there's no coordination to get it off the ground. There needs to be a leading company or multilateral organization," he says, adding that the project is likely to remain on hold at least until 2012.

Incentives

The pinnacle of sustainable development

is a system that rewards changes of behavior on an individual level and at the same time allows families to raise themselves out of poverty.

This is easier said than done, particularly in Africa where few individuals have bank accounts and most people still eke out a subsistence living far from the reach of established financial institutions.

San Diego businessman David Palella, however, thinks he has found a way to overcome these difficulties. His not-for-profit organization, Carbon Manna Unlimited, has developed a system of direct micro-payments to rural people who offset their carbon production through the use of high-efficiency stoves.

The project aims to establish cell-phone based carbon micro-credit systems, using a simple message service to allow families to monetize the carbon offsets they produce. Its key advantage is that it's based on existing infrastructure. While few rural Africans have landlines, mobile telephone ownership is rapidly increasing, and companies such as Kenyan telecom provider, Safaricom, have already introduced systems that allow subscribers to transfer money via cell-phones.

"Africa has the most advanced cell-phone-based payment systems using simple text," Mr. Palella says. "You can establish a sustainable carbon reduction project almost anywhere in Africa and share the money through these systems."

Mr. Palella acknowledges that most voluntary emissions reduction trading systems require those that benefit from them to go through a series of time consuming steps, as well as wade through the necessary paperwork. This can be difficult to prepare and costly, especially when it is contracted out to carbon project consultants. Still, he notes that the voluntary emissions reduction market in Europe is worth over $50 billion a year, and that Carbon Manna is a sustainable, open-source, micro-profit-sharing system in which the paperwork can be standardized and streamlined.

Realizing a first demonstration project has been tricky for Mr. Palella. A Kenyan offshoot strayed from the guidelines of the original concept, he says, while an Ethiopian project is looking to build its system on the structure of an existing charity for poor farmers.

However, some industry experts say the expiration of the Kyoto treaty in 2012, by disbanding the separate United Nations emissions trading framework, could potentially create more impetus for innovative approaches such as Mr. Palella's Carbon Manna.


Geothermal

In a continent with little electrification, East Africa is particularly vulnerable, lacking the fossil fuels and natural resources of much of the western half of the continent.

Yet the United Nations Environment Program believes geothermal power sources, extending across the Rift Valley from Ethiopia to Mozambique, could support the region's power needs. Research by the U.S. Geothermal Energy Association backs this ambition up. It estimates there to be as much as seven gigawatts of geothermal potential in the region.

The African Rift Geothermal Development Facility was launched in 2010 to promote its use. The project includes a regional networking system and technical assistance program, supported by UNEP, as well as a risk mitigation fund backed by the World Bank.

Kenya established the Olkaria fields, Africa's first geothermal project, nearly two decades ago and continues to be the only country in the region actively exploiting geothermal resources.

Geothermal energy is expected to account for nearly 40% of Kenya's total power needs by 2012, with estimated potential capacity of 7,000 megawatts, according to UNEP.

Mr. Connick believes that the unique nature of the technology and absence of significant competition in the development of geothermal projects means that geothermal power is likely to be a later stage alternative form of energy.

Electric car rental scheme hits Paris

Autolib scheme opens to Parisians in bid to cut air pollution and build on success of Velib cycle hire scheme

EurActiv, part of the Guardian Environment Network, with Reuters

guardian.co.uk, Wednesday 7 December 2011 11.31 GMT

A parking station for the Autolib electric car-share scheme is seen on a street in Paris, December 2, 2011. Photograph: Christophe Ena/AP


Pay-as-you-drive electric car rentals are expected to help cut pollution and reduce traffic in Paris, as the new fleet of fully electric Autiolib' vehicles hits the French capital.

As of Monday, Parisians could take the bubble cars for a ride from more than 1,200 parking spots where they rest for recharge.

A subscription cost €10 a day or €15 a week, while an annual subscription of €144 subscription allows users to take the car for only half an hour each time for €5, just over the price of two underground tickets.

The Autolib' system builds on the success of the Velib' bicycle-sharing service and could provide a shop window for entrepreneur Vincent Bolloré and his nascent car battery business.

"We want to persuade people to shift from the concept of owning a car to that of using a car," Autolib' General Manager Morald Chibout told Reuters.

Soaring insurance and parking costs have already persuaded 25% of French citizens to cut back or give up on using their cars, according to a study published last year by Chronos TNS Sofres.

The little four-seater Bluecar, designed and manufactured exclusively for Bolloré by Italian designer Pininfarina, famous for sculpting Ferraris and Maseratis, will have a range of up to 250 km between before a recharge which will take about four hours.

Bolloré said his batteries are safer than the lithium-ion variety used by most of the car industry because they are less prone to overheating. They are also more stable when being charged and discharged.

The car rental scheme follows the car-sharing project launched on 30 September 2011, which also aimed to clear the traffic-clogged Parisian boulevards and deliver what its backers hoped would be a major boost for electric vehicles.

Under the €235 million project, the brainchild of Paris Mayor Bertrand Delanoë, the car-hire service debuted with 66 cars and 33 rental stations across Paris before expanding to 3,000 vehicles and more than 1,000 stations by the end of 2012.

Similar projects exist in the US and in other European countries, such as Belgium, Germany and Switzerland. The Belgian 'Zen Car', one of the first EV-for-hire services, was launched at the beginning of this year with around thirty "100% electric" cars.

The vehicles can be booked by internet or via phone and can be found in around 15 different parking spots around Brussels, next to transit stops. The standard annual subscription for 'Zen Car' costs €40 with an hourly rate of €7 in the day time and €5 at night.

Bill Gates and China in discussions over new nuclear reactor

The Microsoft co-founder has confirmed plans to jointly develop a new nuclear reactor, which can run on depleted uranium

Associated Press

guardian.co.uk, Wednesday 7 December 2011 15.52 GMT

Microsoft co-founder Bill Gates confirmed on Wednesday he is in discussions with China to jointly develop a new kind of nuclear reactor.

"The idea is to be very low-cost, very safe and generate very little waste," said Gates during a talk at China's Ministry of Science and Technology.

Gates has largely funded a Washington state-based company, TerraPower, that is developing a Generation IV nuclear reactor, which can run on depleted uranium.

The general manager of state-owned China National Nuclear Corporation, Sun Qin, was quoted in Chinese media last week saying Gates was working with it to research and develop a reactor.

"TerraPower is having very good discussions with CNNC and various people in the Chinese government," said Gates, cautioning that they were at an early stage.

Gates says perhaps as much as a billion dollars will be put into research and development over the next five years.

TerraPower says its traveling wave reactor would run for decades on depleted uranium and produce significantly smaller amounts of nuclear waste than conventional reactors.

"All these new designs are going to be incredibly safe," Gates told the audience. "They require no human action to remain safe at all times."

He said they also benefit from an ability to simulate earthquake and tidal wave conditions. "It takes safety to a new level," he said.

Since leaving Microsoft, Gates has concentrated on philanthropy and advocating on public health, education and clean energy issues.

Gates was at the Ministry of Science and Technology to talk about a joint project between China and the Bill & Melinda Gates Foundation to support innovative research and development to help alleviate poverty.

Gates said the ministry will help identify entrepreneurs and companies to manufacture new products in global health and agriculture to "change the lives of poor people", including new vaccines and diagnostics and genetically modified seeds.

"China has a lot to contribute because it's solved many of the problems of poverty, not all of them but a lot of them, itself, and many Asian, south Asian and African countries are well behind, whether it's agriculture or health," said Gates.

No concrete poverty alleviation projects were mentioned.

Warren Buffett to buy Californian solar power farm worth $2bn

MidAmerican Energy Holdings is to take over Topaz Solar Farm

Rupert Neate

guardian.co.uk, Wednesday 7 December 2011 17.58 GMT

The billionaire investor Warren Buffett has agreed to buy a solar power farm in California worth $2bn (£1.3bn).

Buffett's MidAmerican Energy Holdings will take over Topaz Solar Farm, which is expected to produce enough power to run 160,000 homes when it is up and running in 2015. The farm, halfway between Los Angeles and San Francisco, is the world's second-largest photovoltaic plant under construction and is expected to generate 550-megawatts of electricity or about half the power of a nuclear reactor.

The deal comes hot on the heels of a string of green energy investments by the famous investor. MidAmerican, which is part of Buffett's Berkshire Hathaway empire, is the largest wind energy provider in the US where it operates more than a dozen wind farms.

MidAmerican sealed the deal for Topaz on Wednesday, a day after the seller, First Solar, failed to secure a US government loan guarantee for the project. The terms of the deal were not disclosed, but First Solar's difficulties securing funding for the vast project suggests Buffett probably got a good deal. First Solar will continue to build the farm on behalf of Berkshire and it is due to open in early 2015.

Greg Abel, chief executive officer of MidAmerican, said: "[Topaz] demonstrates that solar energy is a commercially viable technology without the support of governmental loan guarantees."

Analysts suggested Buffett is moving from wind to solar power to take advantage of lucrative tax breaks. Gerard Reid, an analyst at Jefferies, said: "The reason for the move from wind to solar is very simple. Tax credits for wind in the US expire at the end of next year, while solar ones run till 2015."

In February Buffett, the world's third-richest man, said he was keen to make a fresh wave of "major acquisitions". "Our elephant gun has been reloaded, and my trigger finger is itchy," he told investors in his annual letter to shareholders.Last month he ended his moratorium on investing in technology, taking a $12bn (£7.5bn) stake in IBM, the 100-year-old tech firm. Berkshire Hathaway has been buying shares in IBM since March and now owns 64 million shares, or about 5.4% of the outstanding stock.