LOW-COST ENERGY:THE ECOLOGY Foundation (TEF), a Dublin-based green business group, is developing a renewable energy company in Africa with the potential to generate significant income for its poorest regions. It is doing this in collaboration with the GSM Association (which represents global mobile phone networks), Concern and Hanley Energy.
This year the new venture, Afrigen Community Power, will bring power to 100 communities using a combination of batteries and fuel cells, solar and wind power. It began in Tanzania, Burundi and Kenya. Next year, the aim is to provide electricity at 1,000 sites, some of them in other African countries.
The energy solutions will reduce the fossil fuel use in developing countries, specifically charcoal and kerosene, which are expensive and harmful to health and the environment.
Over the past three years, TEF has invested $1 million (€700,000) in establishing the business. The company is now raising $5 million and this year will invest $2 million (€1.4 million) in the venture.
The further rollout of the business over the next five years will require up to $1 billion (€700 million) in debt finance, in order to bring sustainable energy to 10,000 communities in 16 countries, which could amount to one million homes.
The business model may also be taken outside Africa, to poorer regions of Pakistan, India and Bangladesh. There could also be opportunities to bring new partner companies into the alliance from cleantech and engineering sectors.
Afrigen is in talks with governments, the World Bank and the International Finance Corporation about providing guarantees for the financing of the company’s growth plans.
“The returns will be very substantial and from the outset we have insisted that the communities to which the renewable electricity will be provided will benefit through a community revenue share. In each community we will be providing a medical kiosk and a learning kiosk. There is already interest from community groups in occupying and operating these,” said Ecology Foundation and Afrigen founder Declan Murphy.
The poorest communities in East Africa have no electricity and use kerosene for light, spending a large proportion of their incomes. Afrigen will supply power to communities at a lower cost.
In 2009, the International Energy Agency (IAE) estimated that 1.5 billion people – about 22 per cent of the world’s population – had no access to electricity: 85 per cent of these live in rural areas. In some African countries, the rate is of electrification is just 11 per cent.
Key to Afrigen’s business is an intelligent meter and control device, designed by Clive Gilmore of Hanley Energy and made in Ireland. When installed at mobile phone network base stations, it enables about 10 per cent of the electricity supplied – by diesel generators – to be drawn off, and transported to nearby communities. In parallel, Afrigen can install wind and solar power beside base stations.
