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Ghana Priorities: Rural Electrification

According to Ghana Energy Commission (2019), the electricity access rate in rural areas was 67.2% in 2018.

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Ghana Priorities: Rural Electrification

  1. 1. EminentPanelConference,Accra,August7th -9th,2020 PRELIMINARY FINDINGS: The costs and benefits of electrifying rural Ghana Francis Kemausuor, Kwaku Amaning Adjei, John Bosco Dramani, Prince Boakye Frimpong Kwame Nkrumah University of Science and Technology, Kumasi
  2. 2. Background and problem definition • Ghana is one of a few countries in sub-Saharan Africa with relatively higher access to electricity - 85% access in 2019 - Largely achieved through grid extension • Urban communities have achieved universal access to electricity • Some rural communities remain to be electrified - Approximately 67.2% electrified as of 2018 - Comprehensive plan and policy available for island communities - Some remote communities may pose challenges with the status quo
  3. 3. Background and problem definition • According to the Ghana Statistical Services (2019), electricity access across the north of the country is less than 70%. 0 10 20 30 40 50 60 70 80 90 100 National grid connection (%) Region
  4. 4. Background and problem definition • Apart from island communities, Ghana has traditionally used grid extension to provide electricity access - Remaining unelectrified communities are rural, with some possibly remote communities • Extending the grid may not always be the most cost optimized electrification option. The technical feasibility may depend on several factors such as: - terrain of the location - distance to existing grid - size of loads - local availability of resources (both fuel and human resources)
  5. 5. Background and problem definition • The end game is to have a system that is: - technically feasible - addresses the required demand - reliable - has potential to contribute to poverty reduction - support the achievement of the SDGs
  6. 6. Objectives • The aim of our research was to model electrification options for unelectrified rural communities in Ghana, from the perspective of costs and benefits. Three interventions were studied as follows: - Grid expansion to communities for which the grid is the most cost-effective solution - Solar and diesel micro-grids to suitable remaining communities - Grid expansion to remaining communities of more than 100 households
  7. 7. Methods Spatial Analysis Spatial Analysis and Planning Demand Analysis Load forecasting Network options Optimization of supply options Distributed Energy Standalone Systems Output: Rural electrification blueprint for the target study area
  8. 8. Method (Benefits side) • The benefits of electrification are estimated using two distinct approaches: difference-indifference (DD) and propensity score matching (PSM). -In the DD, we aggregate the data into district-level averages (thus converting it into panel data), and running the estimation at the district-level. -We compared the outcomes of households who are electrified with those who are not by using data from the 2005/2006, 2012/2013 and 2017/2018 GLSS. -Propensity scores were calculated using the baseline values of the main outcome variables as well as other household and community level characteristics. -Finally we used difference in means estimator when the analysis is focused on the benefits of mini grids.
  9. 9. Intervention 1 Expanding electricity grid to less remote communities
  10. 10. Grid extension as most cost optimized option for less remote communities
  11. 11. Population electrified and cost indicators 4,547 5,315 4,551 4,619 4,559 4,061 5,032 9,436 - 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000 10,000 2020 2021 2022 2023 2024 2025 2026 2027 Population Population electrified per year Indicator Cost Unit Distribution / locality 73,658 US$ Connection / locality 145,157 US$ Total Investment / locality 218,815 US$ Total Investment / inhabitant 411 US$ •For base case, 45% of communities in district suitable for grid extension •Project to be undertaken by Ministry of Energy - Communities could support, using similar arrangements like SHEP
  12. 12. Discounted costs and benefits per household over 20 years (GHS) - Increased income represents ~80% of the benefit - Improved health the remaining 20%
  13. 13. Intervention 2 Solar and Diesel microgrids for ‘more remote communities’
  14. 14. Solar and diesel micro-grids
  15. 15. Implementation • Current government policy require that mini-grid development from design to operation will be public sector led - Private sector participate only through contracts for services, such as construction - Mini-grids are globally more expensive to construct, but could be sensible in remote communities - Tariffs are as approved by PURC and charged to grid customers • No regulation to whip up private sector interest - Private sector participation could increase the speed of implementation
  16. 16. Discounted costs and benefits per household over 20 years (GHS) - More expensive than grid extension - BCR much lower, compared to grid extension
  17. 17. Intervention 3 Expanding electricity grid to more remote communities
  18. 18. Extend grid to all communities with population above 100
  19. 19. Why this intervention? • Traditionally grid extension preferred on mainland • Ministry of Energy expressed interest in seeing results for such analysis due to existing working model • Costing model ‘forced’ to extend electricity grid to all communities with population above 200 - Costs are much higher per capita Indicator Cost Unit Distribution / locality 58 538 US$ Connection / locality 223 738 US$ Total Investment / locality 282 276 US$ Total Investment / inhabitant 679 US$
  20. 20. Discounted costs and benefits over 20 years (GHS) - Benefit cost ratio much lower
  21. 21. Comparing interventions and concluding
  22. 22. Thank you

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