East Africa Seeks Private Investment for Energy Projects

East Africans who have come to the United States and settled here are often encouraged to invest…

Georgia (Aug 20, 2009)East Africans who have come to the United States and settled here are often encouraged to invest in their home countries and stimulate the East African Community’s economic development, but given the distances involved and the immediate demands of their studies and careers the commitment may seem too demanding.

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http://www.globalatlanta.com/article/17521/

The First East Africa Energy Conference 2009, held in Tanzania’s capital, Dar es Salaam, in June, however, underscored the many opportunities for the development of sustainable, renewable energy systems that, although small in scale, can have an important impact on communities, especially in rural areas that still primarily depend on wood fuel, charcoal and kerosene.

The theme is to be echoed at a two-day conference to be held at Kennesaw State University Aug. 20-22, which is to be attended by senior Kenyan government officials and business representatives.

Titled “Building a Knowledge-Based Economy in Kenya: The Role of the Kenyan Diaspora,” the Kennesaw State conference has an Aug. 21 afternoon session that is to focus on renewable energy and energy efficient projects.

While the Kennesaw State conference primarily seeks to involve Kenyans who have settled in the U.S., the Tanzanian conference encouraged investors from throughout the world to seek out opportunities in East Africa’s energy sectors.

The East African Community, an intergovernmental organization comprising the countries of Burundi, Kenya, Rwanda, Tanzania and Uganda, faces severe energy shortages because its hydroelectric facilities have suffered setbacks due to rising demand in the face of droughts.  Blackouts and power rationing as a result of low water levels in reservoirs have forced Tanzania’s main energy company, the Tanzania Electric Supply Co., to rely on gas-powered generators and to encourage thermal projects to meet increasing demands.

During the June conference, Tanzania’s Prime Minister Mizengo P. Pinda called for private investment to help supply the region’s energy needs in the future. The East African Business Council, an umbrella group for all the business associations in the East African Community, hosted the conference at the Moven Pick Royal Palm Hotel in bustling downtown Dar es Salaam only a few blocks from the Indian Ocean.

In his keynote address, Mr. Pinda highlighted the need for new government policies to encourage more private sector involvement, and underscored the necessity for cross-border regional policies among EAC members.

Mr. Pinda provided an overview of the EAC’s dependence on high-priced electricity, which has been estimated to cost as much as five to 10 times higher than its price in such countries as Egypt or South Africa.

“A loss of energy results in a loss of growth and employment opportunities and less income for the region,” Mr. Pinda said, adding that the shortages of power generation would hold back the region’s sustainable development as a whole.

While the region’s major power projects are seeking foreign investors, Mr Pinda’s remarks did not focus entirely on the big hydroelectric contracts. He also outlined a rural energy plan that would provide electricity to agricultural areas, which are dependent today primarily on wood fuel and charcoal.

Council Chairman Reginald Mengi said that while the development of larger projects was essential, he underscored the importance of initiatives to develop medium level hydro-electric plants and other renewable energy systems such as wind, biomass, bio-fuel, solar energy and co-generation.

The conference highlighted simple technologies such as those of the Vincentian Sisters, a Catholic order, in Mbinga, Tanzania, providing electricity to the 12 buildings in their educational center. The Sisters’ compound has a photovoltaic system that converts solar energy to electricity in a generator that runs off pure vegetable oil and batteries.

The use of solar thermal energy is already well established in southern Uganda where it provides drying processes for fruits that then can then be shipped over long distances without spoiling.

Also discussed were opportunities in both rural and urban areas for wind turbines as were opportunities for the development of biogas projects.

The conversion of waste discharged into streams from food processing plants into methane-rich gas that can be used in a combustion turbine or gas engine was one example cited in a brochure distributed at the conference.

Despite the community's support of private investment, efforts to privatize the energy sector in the region have been hampered by a lack of engagement by financial institutions and inconsistent management by independent power producers, Michael Franz, a German energy adviser attending the conference, told GlobalAtlanta.

Currently the main sources of funding for international for both small and large projects in the region are from Europe, India and China, with only a few North American investors.

Representatives of Joint Environmental Techniques, which is jointly owned by a group of Swedish investors and the Indian founders of Appropriate Rural Technology Institute of Tanzania, attended the conference.

Among their products are charcoal briquettes manufactured by a variety of dried biomasses, compact biogas systems that use kitchen and food waste as feed stock for gas production and specialized stoves that use small quantities of charcoal.

The company also connects rural residents who produce its briquettes and urban residents who buy them for cooking their meals and heating their homes.

Laura Smeets, manager of Delight Design Inc.’s Dar es Salaam office, told GlobalAtlanta that the company’s solar-powered lamps would sell well throughout East Africa because they replace costly and dangerous kerosene lanterns, which are used in households far away from national energy grids.

The company is backed by U.S. and Indian venture firms and is expanding its distribution network through what she called “traveling road shows.” “When you explain the cost benefits of using solar lamps versus kerosene on-the-spot, they somehow get the money and buy it,” she said.

Once the products have been marketed in a specific area, D.light appoints a local retail dealer and connects them with a regional distributor. The company aims to set up distributors throughout the region, creating a widespread network with low operating costs.

For more information on the conference held in Dar es Salaam, please visit http://eabc.info/energyconference/

The Kennesaw State conference, which begins on Friday, Aug. 20, is to focus on Kenya’s future as a “knowledge-based economy,” and will include sessions about a variety of economic sectors.

The session titled “Meeting Energy Demand for a Growing Economy: Opportunities for Investment,” will be held in the afternoon of Saturday, Aug. 21. To see the conference program, go to www.kenyaopen4business.com or for more information call Stephen Ndiritu at (678) 797-2410 or Sabbaye McGriff at (678) 797-2550.

KC Bolton, who did the reporting for this article, is studying for a master’s degree in economic geography at McGill University in Montreal. He attended the conference in Dar es Salaam, Tanzania, on behalf of GlobalAtlanta. He was scheduled to fly on the inaugural flight of Delta Air Lines Inc. from Atlanta to Nairobi, Kenya, on his way to the conference, but when it was cancelled for security reasons, he was rerouted by Delta to the conference through Amsterdam, the Netherlands, to Dar es Salaam on another airline.

 


 

A leader in innovative teaching and learning, Kennesaw State University offers more than 150 undergraduate, graduate and doctoral degrees to its approximately 41,000 students. With 11 colleges on two metro Atlanta campuses, Kennesaw State is a member of the University System of Georgia and the third-largest university in the state. The university’s vibrant campus culture, diverse population, strong global ties and entrepreneurial spirit draw students from throughout the region and from 92 countries across the globe. Kennesaw State is a Carnegie-designated doctoral research institution (R2), placing it among an elite group of only 6 percent of U.S. colleges and universities with an R1 or R2 status, and one of the 50 largest public institutions in the country. For more information, visit kennesaw.edu

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