The African continent is revolutionizing itself as the place where no infrastructure is no problem. This began in the telecommunications field: Africa lacks a robust system of landlines, which traditionally enable better access to desktop computers, online services, and financial institutions. But the emergence of cellular telephony has allowed individuals across Africa to bypass this infrastructure deficiency. Today, the Pew Research Center estimates that over two-thirds of Africans own cell phones, with adoption nearing 90% in some countries. Now, Africa may be on the path to revolutionizing itself in a second field: electricity. Decentralized energy storage options, like those announced by Tesla, General Electric, Samsung, LG Chem, and others, could play a significant role in enabling that revolution.
Currently, Africa’s energy situation mirrors its former telecommunications situation. Over 600 million people live without access to electricity in Sub-Saharan Africa. While 13% of the global population lives on the continent, they currently constitute less than 5% of global energy demand. And the continent as a whole is rich in renewable energy resources: the Sahara Desert provides unparalleled sunlight access, the Rift Valley contains geothermal reserves, and the coasts and interior have strong wind streams. But at present there is no way to harness or store these energy sources effectively.
Hence the potential significance of distributed generation. By day, a home battery can be charged on renewable sources; by night, it will continue to provide power despite the setting sun or calming winds. Most manufacturers of decentralized storage appear to provide scalable batteries—one battery could power a home or small business, and many batteries could power a town. Home battery costs have decreased 14% since 2007, as many manufacturers currently list their home batteries at around $3,000. Moreover, costs to consumers will likely continue declining because of the many manufacturers competing in the marketplace and Tesla’s promise to place its home battery specifications in the public domain.
When Tesla CEO Elon Musk unveiled his company’s home battery on April 30, 2015, he noted its potential value for Africa. The alternative—installing and upgrading traditional grid infrastructure on the continent—is highly expensive. For instance, South Africa’s government-owned utility company estimated it would cost $22 billion to improve the grid enough to meet current demand. Decentralized energy storage that is affordable will increase the feasibility of on-site energy generation and reduce the need for a fully-developed transmission grid. Analysts project the market for microgrids reaching $20 billion in 2020, and on-site generation of solar power becoming comparable to or cheaper than grid-supplied power. Just like how cell phones enabled access to the internet and microfinancing, distributed generation and on-site storage could light up homes, increase technological innovation, and change the look of the African economy.
Whether a home battery built by Tesla, General Electric, Samsung, LG Chem, or another company becomes the premiere energy storage solution in Africa, distributed generation has the potential to revolutionize electricity and power throughout the continent.
Calvin Cohen is a summer associate in Covington’s Washington D.C. office and a student at Vanderbilt University Law School.