Frequent power outages - A curse for Africa!

Kevin Mokento | Monday November 29, 2021 06:00

This applies even to inhabitants of continental economic powerhouses like Nigeria and South Africa. Just last week, my daughter, a fresher at the University of Botswana, was in the process of taking her first ever online examination when her computer unceremoniously shut down. No, it was not a low cash issue. It was either an unplanned, or planned, but unannounced mains power failure. Fortunately, two things worked in her favour, the programme used for her examination automatically saved her work and the outage lasted no more than 20 minutes.

Power outages should not be that much of a problem if they are few and far between, but when they are the norm, they are an unwelcome irritant for households, firms, students, and their instructors. For many people, the worst time for a power outage is at night. This leaves many families feeling insecure and vulnerable to opportunistic criminals who are always keen to take advantage of blackouts. And of course, leisure time with friends and family can easily be ruined by outages, particularly when they are prolonged, as typical in many African countries.

A bumbling oaf can work out that inextricably linked to any nation’s development is a solid, robust, and resilient infrastructure. And lest our pride is only confined to a once-off provision of infrastructure, let’s be clear, intermittent access to crucial infrastructure alone is not sufficient. It is essential to put in sharp focus not only the current reliability of the infrastructure but also the implementation of forward-looking plans to ensure continued dependability and constancy going forward. Most African countries excel in providing access to power but fall short on ensuring uninterrupted power supply with the passing of years. Since reliability of power supply is crucial, some households and firms are forced to invest in alternative sources of power such as Uninterrupted Power Supply systems, generators, and solar power panels. Any country’s quest in attracting FDI, especially for innovation hubs and special economic zones, to a large extent, depends on the reliability of power supply. Frequent and unplanned blackouts are a turn-off for investors!

A substantial one-time capital investment in power generating plants, while laudable, unfortunately fails to capture the resilience required to make the generation, transmission, and distribution of power stable over time. Three critical imperatives should always inform the quantum of investment in the chain of power provision, and these are, quality, sufficiency, and sustainability.

Where governments deal with credible suppliers and contractors, the issue of quality, at least at the time of development of a power plant, does not normally arise. However, to ward off potential for acquisition of substandard equipment, authorities must take it upon themselves to do all the necessary groundwork as part of their due diligence exercise, to ensure they source the right material and engage qualified and competent professionals to deliver the project. Issues of sufficiency and sustainability are dynamic in nature. Principally because properties to be serviced always increase over time. The quantum of such increase is normally informed by structural and development plans which can be accessed by any member of the public. If authorities consider these factors, they are likely to succeed in minimising chances of power supply pathetically lagging demand and they would not reduce power supply to individual properties to a nugatory box-ticking exercise.

Cities, towns, and villages do not grow overnight. Such growth is normally planned for. For instance, when the Botswana Housing Corporation (BHC) developed a whole township in Block 5 and another one in Phakalane, all critical authorities were informed, water and sanitation, transport, telecommunications, and power. It is the duty of these critical stakeholders to ensure there is no mismatch between delivered property developments and key infrastructural services. One would assume that the same consideration applied when planning was approved for massive developments such as Game City, Riverwalk Mall, Airport Junction Mall, Railpark Mall, the CBD, Tsholefelo East, Block 10 and Gaborone North. However, in practice, while authorities are happy to approve planned developments, they often fall short in ensuring the relevant infrastructure keeps pace with approved expansions. They would go to the extent of supplying power to new developments while alive to the fact that such supply would not be reliable in the medium to long-term. The building of reserve power generating capacity will always remain a dream if the supply of power is always chasing the demand.

The issue of sustainability of power provision should never be considered inconsequential. Central to sustainability is the willingness and capacity to maintain all the requisite infrastructure for power supply. While from time to time reactive maintenance would have to be carried out, a mindset of proactive maintenance is important. Power utility companies (PUCs) are always alive to the importance of such preventative initiatives. However, they are often constrained in countries where provision of power is a developmental issue that cannot sustain itself.

Where a PUC fully depends on government subventions and is forced to approach the government at the commencement of each financial year, cap in hand, the chances of securing sufficient capital to drive a proactive maintenance programme are low. In fact, it is possible for the government to reason that their focus is on other important developmental issues and only award the PUC a negligible fraction of the budget required for maintenance. Underfunding happens because governments do not have access to an endless pool of capital, hence the need to share the cake with other deserving sectors. This becomes even more important when there is enormous pressure for governments to perform in harmony with political manifestos that are tied to a short and fixed guaranteed term of governance. Maintenance failure always leads to equipment failure and power interruptions.

My view is, there is validity in the sobering insights raised by credible and influential international organisations in favour of running self-sustaining and financially sound PUCs. The government of Botswana has already made inroads into this concept by demanding that BHC should run a self-sustaining state-owned enterprise. BHC sources funding from the capital markets, in many cases, unsupported by government’s guarantees, but anchored on the strength of the corporation’s sound financial position as supported by an attractive balance sheet. How feasible is this for PUCs in Africa, particularly those rocked by an inordinate frequency of outages, leadership lethargy, swelling technical challenges and attendant operational inefficiencies, insufficient funding, inflated maintenance costs and ballooning accounts receivables?

The challenge lies in sparsely populated countries like Botswana where the required return on assets may be impossible to achieve because of the misalignment between the quantum of requisite capital investment and volumes of consumption on the back of low populations. This is important particularly in the context of the COVID-19 era when resources are largely dedicated towards improving and sustaining the overly burdened health infrastructure. The best governments can do, would be to empower PUCs to operate efficiently. One way is by granting boards of PUCs the autonomy they deserve to appoint competent senior officers to run credit-worthy organisations and hold them accountable through a credible performance management system that adequately rewards performance and penalises underperformance. Where boards through empowered management teams and objective cost-benefit exercises engage in mature conversations revolving around the need to unbundle power supply into its three key areas of generation, transmission, and distribution; parent ministries must consider leading in lobbying for and driving such change. It would be anti-progressive to burden ourselves with the anachronism that only one government-controlled entity should operate in the entire value-chain space of providing power.

Owing to the level of definable upfront investments required to produce power, most African countries have a government-controlled sole supplier of power. Developed nations have considered renewable energy sources of power and have appointed independent power producers with a view to ramping up supply. If policy or constitutional reforms are required to overhaul the status quo and build in resilience and reliability to the supply of power, it would be essential to bring on board critical stakeholders to drive such an important national agenda. Sometimes progress demands that we should incisively rock the very boat we are comfortably sitting in and there is nothing illogical nor abstract in that. This is a necessary precursor to venturing on the excursion to bringing African countries a few steps closer to defeating the curse of power outages.