The government has fixed targets of providing electricity for 85% of rural areas by 2025 and achieving universal access to electricity for its population of around 1.7m by 2035. The objectives were set out in the Policy Letter for Universal Access for Basic Services in Rural Areas, which was approved by the Council of Ministers in September 2014, and which also noted that only 15% of rural areas had electricity as of 2014.
Achieving these targets will be a tall order, taking into account that tropical forest covers 85% of Gabon, and that the country has a population density of seven inhabitants per sq km, compared to an average of 30 per sq km for Africa as a whole, according to African Development Bank statistics from 2011. Gabon has around 3000 villages with populations of 50-1000 people.
Supplying power to all the consumers in the country’s three main cities – Libreville, Port-Gentil and Franceville, which house around 80% of the country’s total population – is proving a challenge in itself given average annual demand growth of 6% and the historical underinvestment in generation and grid infrastructure. Bringing power to isolated rural areas is another challenge entirely.
Power Grid Extension
Numerous solutions to this issue have been envisaged. These include the extension of the grid towards rural areas and the development of small-scale renewable energy projects, such as biomass-fired cogeneration, mini-hydropower and solar photovoltaic.
The grid was extended in the north of the country in late 2013 under contracts awarded by the government to Spain’s Isolux Corsán and France’s Bouygues Energies & Services, formerly ETDE. Isolux Corsán connected 33 villages in the northeast provinces of Estuaire and Moyen-Ogooué, with the installation of 200 km of 20-KV power lines: 140 km between Kango and Lambaréné and 60 km between Bifoun and Ndjolé, as well as a 225/20-KV substation transformer in Bifoun.
Bouygues Energies & Services developed the network in the country’s northern province of Woleu-Ntem, with the construction of 163 km of 63-KV lines linking Mitzic via Oyem to Bitam, as well as connecting nearby villages and the town of Minvoul. However, the latter of these networks is currently not connected to any source of power, pending the construction of the 36-MW Fé 2 hydropower plant. The planned construction of a line linking the new natural-gas-fired plant at Port-Gentil with Libreville, passing through Lambaréné, will also provide for the connection of rural communities lying close to its route.
Looking to Replace Diesel
For Jean-Paul Camus, the director-general of the privatised national water and electricity supplier, Société d’Energie et d’Eau du Gabon (SEEG), the solution is to exploit local natural resources rather than expanding the national network to connect low-demand load centres across the country.
“Taking into account the low density of the population, it would not make much sense from either a technical or an economic point of view to build high-voltage lines of several hundred kilometres to supply villages requiring no more than 5 MW,” Camus told OBG. “At present many rural localities are supplied by small diesel generators, which have a number of disadvantages. First, it is often difficult to supply the diesel to these remote locations given the quality of the road network. Second, it makes more sense economically to export diesel than to use it locally. So we are trying to promote the development of small renewable energy projects, harnessing the country’s rich hydropower and biomass potential.”
One such pilot biomass power project is being developed by Société d’Investissement pour l’Agriculture Tropicale (SIAT) of Belgium. The 1-MW plant in Lambaréné, south-east of Libreville, will burn residue from local palm oil plantations to generate power for onsite requirements as well as for the local communities under an offtake contract signed with SEEG. The plant is expected to enter service in the third quarter of 2015 once connected to the grid by SEEG.
Further projects are planned at various plantations across the country, such as in the areas of Mouila, also south-east of Libreville, and in Oyem in northern Gabon, according to Camus.
Singapore-based Olam International is also planning to invest in a biomass plant to supply its future palm oil mill at Mouila, which would be the plant’s major consumer. Studies have just begun as the mill will not be commissioned for another three years to coincide with the first harvests.
For the mill at its Kango palm oil plantation, which is set to enter operation in the third quarter of 2015, electricity will be generated by a steam turbine using the by-products of the processing of fresh fruit bunches.
During non-processing hours, electricity is generated by diesel gen-sets. Olam International also intends to replace diesel with biogas generated by capturing methane gas from the anaerobic digestion of palm oil mill effluent, toxic waste created during processing at the mill.
World Bank Project
Off-grid generation is also the driving component behind the World Bank’s push to encourage the use of small solar systems. Commissioned by the government in 2011, the programme aims to roll out a self-financing subsidy model that gives retail users in rural areas affordable access to electricity.
“This model has two main pillars: delegation of responsibility for operation and maintenance of the systems to specialised operators as well as a sustainable long-term financing mechanism that will combine cost recovery with subsidies,” said Stephan Garnier, a lead energy specialist at the World Bank.
Subsidies will be required to cover the difference between the cost of the basic services and what poor rural consumers can be expected to pay, which is estimated at around 10-20%. The current thinking in order to make the subsidy system sustainable and not reliant on the government budget is to have the subsidy paid by the sector itself, for example through an increase in the electricity tariff paid by urban consumers. A rise of not more than 1.5% is estimated to be sufficient.
Under its planned model, the country will be divided into four regions, with one operator to be recruited per region to install, operate and maintain the systems and recover payment for its services, whether on a KWh-price basis or a service fee, under a five-year contract with an option for renewal based on performance. Equipment will be procured separately. It is hoped this will avoid past problems of equipment being installed and then not maintained properly.
“Equipment suppliers make their profit on supply and installation and not on operation and maintenance. Over the last 20 years, the state has invested significantly in rural infrastructure to provide basic water supply for 25% of villages and electricity for 10% of villages, but 95% of this infrastructure is no longer in service,” said Garnier.
A pilot project in one region, which has an estimated cost of around $40m, will be financed by the World Bank to test the model before its rollout nationwide, but the timing of the scheme is uncertain given the government’s move to slow and review capital spending in the wake of the fall in international oil prices.
Solar power systems are already being installed in rural communities by Su-Kam Power Systems. The India-based power solutions provider was awarded a five-year contract worth around $25m by the government in January 2015 to supply, install and service 120-W DC integrated solar power systems for 40,000 rural households to power three lights and a fan per house. In 2013 Su-Kam completed the installation of 2000 stand-alone solar-powered street lights in Kango, Mouila and Bitam, and a further 400 in the Nkok special economic zone.
In contrast, the prospects for utility-scale solar photovoltaic projects in Gabon seem rather slim, given the country’s relatively low solar irradiation levels and the need to clear large areas of tropical forest in order to build such schemes.
Canada-based engineering consultancy Hatch was hired in September 2010 by the Ministry of Energy to assist in the assessment of wind and solar resources at six national parks as well as across the rest of the country, and to identify potential renewable energy projects. The results of this assessment had not been disclosed at time of press.
Source – Oxfordbusinessgroup.com