eParliament Forum on Climate Change

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e-Parliament Forum on Climate Change Energy
AccessAkosombo Hotel, GhanaSeptember 20th
-22nd, 2008
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RURAL ELECTRIFICATION THE GHANA
EXPERIENCEBYFRANCIS GBEDDYDIRECTOR (Natural
Gas, Power Renewables) ENERGY COMMISSION,
GHANA
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PRESENTATION OUTLINE

• Introduction
• Overview of the Ghana Electricity Sector
• Evolution of rural electrification policy
• Implementation Strategy Schemes
• Key Challenges
• Way Forward and Recommendations

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(No Transcript)
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Land Area 238.5 km2- Population
18,845,265 (2000 Census)- Av. GDP Growth Rate
5.5
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Introduction

• Primary Energy Resources
• Biomass ?
• Fossil Fuels ?
• Hydro (Large,
• Medium, Mini), ?
• Wind Solar

• Secondary Energy Resources
• Charcoal Woodfuels(65)
• Petroleum products (25)
• Electricity (10)

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Overview of Electricity Sector - Players
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Electricity Supply Industry Structure (a)
Before Reforms (b) After Reforms
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ELECTRICITY SUPPLY INFRASTRUCTURE
Generation Sources
Hydropower
Thermal Power
Akosombo1,012 MW Kpong 160 MW
TAPCO (Takoradi I) 330 MW TICO (Takoradi II)
220 MW Mines Reserve Plant 80 MW
Bui 400 MW
Power Barge 125 MW VRA Tema 126 MW Osonor
Power 126 MW Asorgli Power 220 MW Cenpower
400 MW
Imports up to 250 MW
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Electricity Supply - Typical Generation Mix

• Type of Hydro-year
• Good Hydro Year ?
• Bad Hydro Year ?
• 2007 (Crisis Year) ?

• Hydro Thermal
• 60-80 20-40
• 40 60
• 53 47 (But with massive curtailments)

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161 KVA Transmission Network in Ghana
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Rural Electrification-The National
Electrification Scheme

• Policy instituted in 1989 following GOGs
  successful implementation of NESREP (1986-90).
• National electrification access was then about
  10 (i.e. age of population using electricity)
• 46 out of the 110 district capitals existing then
  were connected to the grid.
• Less than 5 rural coverage estimated at the
  time.
• National Electrification Levy was instituted and
  the levies collected were paid into a National
  Electrification Fund established to support
  implementation of the rural electrification
  programme.

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National Electrification Scheme Goal and Aims

• Goal of NES is to extend reliable electricity
  supplies to all communities with population above
  500 over a 30-year period.
• Aims
• - to enhance socio-economic development
  nationwide and
• - to reduce level of poverty nationwide,
  particularly in the rural areas.

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National Electrification Scheme Specific
Objectives

• Promote use of local and indigenous resources for
  a cost effective implementation of rural
  electrification.
• Create employment and increase productivity and
  wealth.
• Promote growth of agro-based small scale
  industries.
• Reduce the rate of rural-urban migration.
• Improve information access and communication
  services nationwide.
• Improve the quality of life of rural folks.

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National Electrification Scheme Implementation
Strategy

• Comprehensive National Electrification Planning
  Study undertaken between 1989-1991 by Acres
  International of Canada and Asare-Tsibu
  Partners of Ghana.
• Developed a comprehensive National
  Electrification Master Plan for 4,221
  communities.
• All possible options of electrification
  considered including grid extension and off-grid
  renewable energy-based solutions such as biomass,
  solar, wind small hydro.
• 69 grid-based electrification project packages
  identified and prioritized for implementation
  over six 5-year phases ? major output of NEMP.

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National Electrification Scheme Implementation
Strategy (Contd.)

• Connection of district capitals given first
  priority (64 district capitals in total)- Phase
  One
• Subsequent phases prioritized based on economic,
  political, traditional historical factors
• - potential for small-scale industry activity
• - status as commercial market center
• - tourism potential
• - political dispensation and
• - historical importance of area.

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National Electrification Scheme Implementation
Strategy (Contd.)

• Phases 1 2 project packages (430 towns) were
  implemented between 1993-1998 under the National
  Electrification Project.
• DFI-structured project implementation procedure
  was adopted for NES project packages (i.e.
  detailed feasibility, donors conference,
  financing consortium, international bidding,
  award of contracts, etc).
• Project financed through a mixture of grants and
  soft loans from a consortium of financing
  institutions including the DFIs bilateral
  funding agencies.

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National Electrification Scheme Implementation
Strategy (Contd.)

• Local funds (15 of total cost) provided from
  government consolidated budget and the National
  Electrification Fund.
• Projects implemented by transmission
  distribution companies.
• Completed projects handed over for operation and
  maintenance by the distribution companies and
  investments consolidated as part of their assets.

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National Electrification Scheme Self-Help
Electrification Programme (SHEP)

• SHEP is complementary electrification programme
  instituted to support the main NES.
• Rationale To accelerate the connection of
  communities to the national electricity grid.
• Introduced by government to encourage (rather
  than dampen) the self-help developmental
  initiatives of communities.
• Communities that initiate their township
  electrification projects receive government
  support for completion of the projects earlier
  than the scheduled date of connection under the
  NEMP.

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SHEP Criteria for joining SHEP

• Community must be within 20 km of an existing
  11kV or 33kV network suitable for further
  extension.
• Community must procure and erect all the low
  voltage electricity poles required for the local
  network.
• Evidence of a minimum of one-third of houses in
  the community wired and ready to receive
  electricity supply on arrival.
• Community must apply to join SHEP.

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SHEP Implementation Strategy

• Rolling programme with each program spanning
  about 3-4 years implementation period (Shep-1,
  Shep-2, etc).
• Applications received are compiled for
  consideration by Ministry of Energy at the
  commencement of a programme.
• Visits are made to the various communities to
  assess their readiness based on the criteria for
  selection.

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SHEP- Implementation Strategy(Agencies Roles)
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SHEP- Implementation Strategy(Agencies Roles)
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SHEPAchievements

• Shep-1 1990-1992 50 Communities
• Shep-2 1993-1995 250
• Shep-3 1996-2002 1,500
• Shep-4 2003- currently 2,500
• National Electricity Access is now 54

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SHEPMajor Funding Agencies

• Indian Export-Import Bank
• US Export-Import Bank
• Swedish International Dev. Agency
• Finnish Development Agency
• South African Banks (i.e. Nedbank)
• Chinese Export-Import Bank

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SHEPLocal Funding Sources uses

• Sources
• National Electrification Fund
• Government Consolidated Budget
• Uses
• Purchase of locally treated HV wooden poles
• Erection installation costs
• Material handling local transportation costs
• Supervision costs

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RURAL ELECTRIFICATION-Key Challenges

• 1. Low initial connection rate
• - High cost of wiring of premises.
• - High connection fees
• Intervention
• Payment of a subsidized connection fee when
  supply is connected within 12 months after
  project completion and commissioning.
• Affordability of tariffs
• Intervention
• Provision of lifeline tariffs in the tariff
  structure.

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RURAL ELECTRIFICATION-Key Challenges

• 3. Delays in project implementation
• - untimely release of local funds by Govt.
• - difficulties with securing appropriate credit
  facilities from foreign donors
• - delays in provision of poles other
  materials.
• Intervention Strong appeal for Government
  Commitment very key in reversing trend.
• 4. Unsustainable OM arrangements
• - Lack of a dedicated implementation agency
• - lack of transparency in accounting for the
  rural network operations business of utilities.

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RURAL ELECTRIFICATION-Key Challenges

• Political interference resulting in the
  manipulation of the selection criteria.
• More difficult remote areas now left to be
  tackled.
• Business as usual (grid extension) ?? or need for
  a change in strategy?
• What available alternative options exist?

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Way Forward/Recommendations

• Establish permanent RE agency to assume full-time
  oversight responsibility for rural
  electrification (i.e. take over rural
  electrification implementation responsibilities
  of Ministry of Energy).
• Review the NEMP and develop a comprehensive
  strategy for rural electrification planning,
  implementation, operation and maintenance.
• Re-define the role of existing distribution
  utilities with respect to Shep implementation
• Particularly, re-define Shep network operation
  maintenance role to reflect separation of the
  commercial business operations of the utility
  from the non-commercial rural network
  operations business.

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Way Forward/Recommendations

• Incorporate RETs in rural electrification
  implementation strategy (e.g. solar, wind,
  biomass and mini-hydro schemes) particularly in
  remote areas. (to supplement existing generation
  capacity, reduce line losses)
• Develop intervention schemes to attract private
  sector participation in service delivery (e.g.
  feed-in tariffs, tax incentives, assurance of
  full-cost recovery).
• Avoid en-bloc subsidization policies and focus on
  the design and adoption of selective and
  targeted subsidy schemes.

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Way Forward/Recommendations

• Implement uniform pricing policy with respect to
  off-grid supply and grid supply areas to avoid
  backlash from section of the public - this calls
  for some form of cross-subsidization.
• Minimize political interference by developing
  appropriate transparent strategies for systematic
  implementation of RE projects.
• Intensify promotion of the productive uses of
  electricity as part of the implementation
  strategy for rural electrification projects to
  impact positively on improved living standards of
  inhabitants.

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Way Forward/Recommendations

• Energy Efficiency
• There is the need to intensify the energy
  efficiency awareness drive with both supply and
  utilization of energy resources in order to
  eliminate waste and save the scarce resources
  available to the national economy for resolving
  other pressing challenges.
• A successful energy efficiency programme will
• - release substantial generation capacity for
  use in other critical areas, and consequently
• - postpone investment in new capacity additions.

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THANK YOU