Download linking energy policy to growth, prospects and limitations

5thWestAfricanCleanEnergy&EnvironmentExhibi:on&Conference2016,
15thofSeptember2016attheAccraInterna:onalConferenceCentre,Ghana
LINKINGENERGYPOLICYTOGROWTH,PROSPECTSANDLIMITATIONSFOR
RENEWABLEENERGY(RE)TECHNOLOGIES,ASPOTENTIALSOLUTIONFORENERGY:
SPECIALEMPHASISONBATTERIES
BYPAULOKAN-ADJETEY,DELEGATIONOFGERMAN
INDUSTRYANDCOMMERCEINGHANA
?
Implementa:onofSurvey:
Inpartnershipwith:
REmeasurespolicyCoverageworldwide
Globalperspec:veofREinvestments
2015,itisreportedthatGlobalInvestmentsinto
REhadincreasedby5%since2011,amounSngto
USD285.9billion.
AfricaandMiddleeastupto58%USD12.5billion
Source:FrankfurtSchoolofFinance&ManagementGmbH(2016)
Purposeofthesurvey
Theneedforalterna:veenergy
supplyinGhana
•  Lowwaterlevels,duetoinsufficientrainfall
paYernsinthecountriesmajorhydroelectric
powerplant(Akosombo)
•  Absenceofnaturalgastofirethecountries
thermalpowerplants
Jus:fica:onforasolu:on
•  2%to6%ofGhana’sannualcostofGDP
(GhanaWholesalePowerReliability
AssessmentReport)-PowerSystemsEnergy
ConsulSngandGRIDCo
•  Averageof4%annualcostofGDP
$1.5billiontofixthepowercrisiswhat
percentageofthisisfromourGDP-VRAin
2014
Ghana’sGDPinDumsoryears
•  2010
Ghanamade$48,678million=$1.94712million
•  2013
Ghanamade$32.18milliondollars=$1.2872million
• 2014
Ghanamade$38.61million=$1.5444million
• 2015
Ghanamade$37.86million=$1.5144million
(GDPSource:worldbank)
DriversofGDP
ElectricityConsump:onbyCustomerclassGWh
6%
ResidenSal
48%
28%
Non-ResidenSal
18%
Industrial
Streetlights
Source:EnergyCommission2016
Sector
Annualcontribu:onofGDPinpercentage(%)
Agriculture
2014
28.2
2015
27.2
2016
12.2
Industry
Services
24.7
47.1
22.4
50.4
27.7
60.1
Source:GhanaStaSsScalService2016
DumSor!
Ghana’s
GDP
?
Alterna:veenergy
solu:ons
Nuclear
RE
Coal
ExploringAlterna:ves
•  Understandingoftheprospectssuch
alternaSvespresent
•  Whatiscurrentlyhappeningtodemandand
supply(marketforthosealternaSveswe
desperatelyneed)?
•  AlternaSvescannotoperateinisolaSon,they
areguidedbypolicy(whatpolicyfavours
thesealternaSves)
ExploringAlterna:ves
•  Doespolicyeffec:velyguidethegrowthand
developmentoftheRE-subsectoritwasbuilt
toenhance?
•  Ifitdoeswhatarethestrengths,weaknesses,
opportuniSesandconstraintsinitsguidance
•  HowcanthesealternaSvesbeexploredin
solvingapowercrisisthat’simpedinggrowth
intheGhanaianeconomy
R&D
Linkingpolicytogrowth
EnergyPolicy
Exploringprospects
andlimita:onsforRE
(effec:vegrowthofRe
sector)
“EnergyEconomy”
InducedGrowthofGDP
drivers
GrowthofRenewable
energySubsector
Sufficientandreliable
power
Provisionofalterna:ve
powerfordriversof
GDP
“InclusiveRegula:on”
SWOTAnalysisofcurrentEnergyPolicy
REandCross-cu_ngpolicysubsectors
•  Overarchingenergysectorgoal:Todevelopan“energyeconomy”tosecureareliable
supplyofhighqualityenergyservicesforallsectorsoftheGhanaianeconomyandalso
tobecomeamajorexporterofoilandpowerby2012and2015respecSvely(EP(2010),
p.5)
•  RESubsector:ToincreaseproporSonofREinthetotalenergymixandensureits
efficientproducSonanduse
-EngagingGhanaianengineersandscienSststocooperatewithinternaSonalexpertsto
bringdownthecostofsolarandwindtechnologies
-CreaSngfiscalandpricingincenSvestoenhancethedevelopmentanduseofRE
•  Managingthefuture:TobuildatransparentandeffecSveregulatoryenvironmentas
wellasstrengthentheregulatoryinsStuSonstofulfilltheirmandateeffecSvely
•  EnergyandGender:Tomainstreamgenderconcernsintheenergysectorandalign
themwithpropersafetyandenvironmentalstandards
•  EnergyEfficiencyandConserva:on:Toremoveobstaclesthathaveconstrainedthe
promoSonandimplementaSonofEnergyEfficiencyandconservaSonmeasures
through:1.FiscalincenSves2.AwarenesscreaSon3.InsStuSonalandhumanresource
capacitydevelopmentand4.FinancialintermediaSon
SWOTAnalysisofcurrentEnergyPolicy
StrengthsforRE
•  ECOWASsub-regionalREtargetsof10%by2020
and19%by2030-Overarchingenergysectorgoal
•  Ghana’ssignatorytotheWAPP
•  RenewableEnergyActof2011(fantasScfour)
-Netmeteringcode
-FeedInTariff(FIT)schemes,
-EnergyFund
-RenewableEnergyPurchaseObligaSon(REPO)
SWOTAnalysisofcurrentEnergyPolicy
StrengthsforRE
•  IncreasingInternaSonalinvestmentinterestinGhana’s
energysector-RESubsector
•  TheavailabilityofinsStuSonsnecessaryforthe
implementaSonofpolicyprovision’s(e.g.Energy
Commission,PublicUSlityandRegulatoryCommissionetcManagingthefuture
•  AnEPthatfactorsgendermainstreamingasasub-sector-
EnergyandGender
•  ImpactsofsuccessfullyexecutedEnergyEfficiencyand
conservaSon-EnergyEfficiencyandConserva:on
SWOTAnalysisofcurrentEnergyPolicy
WeaknessesforRE
•  LackofsovereignguaranteesforuSlityscalePPA’sOverarchingenergysectorgoal
•  Thelackofacreditworthyofftakertoguaranteefuture
paymentofPowerPurchaseAgreements-RESubsector
•  DelaysinimplemenSngsecSonsoftheRenewableenergy
Acte.g.REPO-RESubsector
•  Lackofbothlocalandforeigninvestmentinterestinthe
manufactureofcomponentsforREtechnologies-RE
Subsector
SWOTAnalysisofcurrentEnergyPolicy
WeaknessesforRE
•  LackofaproperandeffecSvecoordinaSonof
informaSonamongstateinsStuSonsfor
efficientlycarryingoutcustomduSesandtax
incenSves-Managingthefuture
•  Restrictednumberofwomeninenergyservice
provisionandmanagement-EnergyandGender
•  Absenceofclearlydefinedpolicyor
comprehensivelawsonEnergyEfficiencyacross-
EnergyEfficiencyandConserva:on
SWOTAnalysisof
currentEnergyPolicy
Opportuni:es
•  AstableandpoliScalatmosphere-Overarching
energysectorgoal
•  Successivepowercrisisthathave
demonstratedtheunreliablenatureof
convenSonalsourcesofenergy-RESubsector
•  Lawsthatfavortheestablishmentof
manufacturingindustriesinGhana
(ExempSonfromEquityrequirementsperGIPCAct865)
-RESubsector
SWOTAnalysisof
currentEnergyPolicy
Opportuni:es
•  PotenSaltogeneraterevenuetopublicinsStuSons,boosSng
theREsectorandtheEconomyasawhole
•  Ghana’spotenSalofservingasadriverofREtechnologiesto
othercountriesinthesub-regionManagingthefuture
•  TheexistenceofanenSreministrycapableofsupporSng
energyandgenderprogrammesinGhanaifiniSated-Energy
andGender
•  Powercrisisofrecentyearsserved
asawake-upcall-EnergyEfficiencyandConserva:on
SWOTAnalysisof
currentEnergyPolicy
Threats
•  DisconSnuaSonofpolicieswiththepotenSalpoliScal
changeingovernments-Overarchingenergysectorgoal
•  PotenSalpoliScalinterferenceintheappointmentof
competentandacceptedmanagersformanaginguSliSes
(VRA,ECG,NEDCO)-Overarchingenergysectorgoal
•  LackingreadinessofgovernmentstoembraceUSlityscale
REtechnologiesasacrediblealternaSveforsolvingour
powercrisis-RESubsector
•  HighcostofimportduSes,ifrawmaterialsareimported
separatelytobeusedinREsystems-RESubsector
SWOTAnalysisofcurrentEnergyPolicy
Threats
•  Growinglocalserviceproviderscannotmeet
commercialbankrequirementsforassessingloan
schemes-RESubsector
•  Seeminglackofinterestbyfemalesinthemale
dominatedtechnicalREvaluechain-Energyand
Gender
•  UnjusSfiedpolicydirecSvesandinstabletax
environment(eg,CET,5%onsolargeneraSngsets/
20%duty+17.5%VATonLEDsarenotstreamlinedRE
Act)-EnergyEfficiencyandConserva:on
Exploringprospectsandlimita:onsof
theREsubsector
-27licensedserviceproviders
-55End-user/clientsofService
providers
Growthof
Renewableenergy
Sub-sector
•  AgrowingglobalroleandraSonalfor
baYeries
•  CharacterisScsofHighcostcomponentsof
anySolarPV/back-upsysteminGhana
(Prospects,LimitaSonsandMarketpotenSal)
•  Supplysideprospectsofserviceprovidersofsolar
PV/windinGhana
Sowhatdidwefind?
MarketLoca:onsofREserviceproviders.
Sowhatdidwefind?
SolarPVInstallaSoncosts–end-userresponses
Sowhatdidwefind?
ClientbaseofREserviceproviders
Sowhatdidwefind?
End-userresponsesonhirepurchaseofsolarbaferybackupsystems
Sowhatdidwefind?
(RecommendaSons-servicepoviders)
“TheGovernmentmustendeavourtoraisetheawarenessofthepeopleinthe
countrytopatronizerenewableenergysoastorelievetheNaSonalgridofsome
load”
“duSesontheimportaSonofrenewableenergyproductsareveryexpensive”
“AccesstocreditisverydifficulthereinGhana.Weexpectgovernmenttoprovide
soscreditfaciliSesandtaxincenSvesforsolarbusinesses.Welostan
opportunitytorepresentaUKCompanyastheirsoledistributorofsolar
productsinGhanaduetolackoffundstoprocureourfirstorder”
“SubsidizaSonthroughanincometaxsystem,whereapercentageoftheincome
taxcanbelowered/abated,andthatspecificpercentage,givenasataxholiday
foraperiod,toenablethetaxpayertoallocatethegivenpercentagetothe
purchaseofsolarsystem.Inthelongrun,consumpSonwouldbeloweredand
thesurpluscanbeusedforproducSveuseofelectricityinindustry.
“ThereshouldalsobetheregistraSonofsolarimporters,tobeabletoimport
differentcomponentstobeimportedfromdifferentcountries.Therecanbe
verystrictpenalSesputinplace,suchthatifcomponentsareforusedfor
otherpurposes,theycanbepenalizedseverelyinaddiSontopayingforallthe
taxestheseparatecomponentsimported”
RecommendaSons
•  Registeredserviceproviderscouldbeallowedto
importhighcostcomponentsseparately,but
underclosescruSny
•  ConSnualdialogueandacSonandcoordinaSon
ofefforts/acSonstowardsachievingtherealisSc
goalsofthepowersector.
•  PolicyharmonisaSonandinter-sectorial/
ministerial/industrydialoguesarekeysuccess
factorsforthebenefitsoftheenergypolicytobe
realised.
RecommendaSons
•  Policieswouldhavetofactorandproperly
regulatehirepurchaseagreementstoensure
standardproceduresarefollowed,andnot
representedintheREAct.
•  Policieswouldhavetofactorinenforcement
ofstandardsforREcomponentstoensurethe
qualityofsystems
Linkingpolicytogrowth
D
R&
EnergyPolicy
Exploringprospects
andlimita:onsforRE
(effec:vegrowthofRe
sector)
“EnergyEconomy”
InducedGrowthofGDP
drivers
GrowthofRenewable
energySubsector
Sufficientandreliable
power
Provisionofalterna:ve
powerfordriversof
GDP
“InclusiveRegula:on”
•  GhanaCandotoREwhatIndiadid
toIT,wehavetheenablingenvironmenttodoso,and
wecanexploretheeverincreasinginvestor
intereststoourbenefits,tocreatesynergiesfor
efficientgrowthofoureconomyandthat’show
youlinkpolicytogrowth
Acknowledgements
• 
• 
• 
• 
• 
IshmaelEDJEKUMHENE
FrederickAppiah
EliezerOdei-Lartey
Lara-MariaKULLAK-UBLICK
EnochYeboahAGYEPONG
THANKYOU!