Africa’s energy demand not being met

A NEW Deloitte report has  described as potentially ‘disruptive’, the changing role of the African electricity consumer for the power industry in Sub-Saharan Africa.

Africa infrastructure and power leader, Shamal Sivasanker, argues that consistent growth in the region — with Africa’s economy having expanded by around six per cent a year over the past 15 years — has meant that energy demand is not only growing, but is also not being met.

African businesses and middle-class households are, therefore, pursuing alternatives, including renewable-energy solutions, to improve security-of-supply and lower energy costs.

“Consumers are increasingly complementing the role of producers through self-generation, co-generation and new generation structures,” the report asserts.

In time, this could result in the emergence of an increasing number of ‘prosumers’, who partially meet their own demand, but also seek to inject surplus capacity into the grid.

Mr. Sivasanker says that customers will, therefore, increasingly drive electricity policy, regulation and market structure across sub-Saharan Africa.

Utilities hoping to navigate this disruptive trend will need to begin to pay as much attention to improving the customer experience, as they are currently paying to revenue retention and the transition towards cost-reflective tariffs.

In light of the current market flux, Deloitte also expects opportunities will grow for private investors, across generation sources, in a sector still dominated by State utilities.

Besides, the rise of the consumer, ongoing economic growth and changes to market structure, the other disruptive trends outlined in the report are a rise in the deployment of renewable technologies, smarter grids, systems and utilities, and changes to the energy mix and ownership of generation plants.

“Africa’s power sector is open for business,” Mr. Sivasanker avers, adding that despite the obvious constraints in the sector, the market is becoming increasingly attractive for new entrants.

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