Sustainably Connecting Off-Grid Consumers

This article was originally drafted by the Lee Kuan Yew School of Public Policy for Issue 13 of the newsletter “Asian Trends Monitoring Bulletin” as part of the Rockefeller Foundation’s Searchlight Process. For more Searchlight content on futurechallenges.org, please click here.

There have been a number of large-scale rural electrification projects around the world based on just extending the reach of large centralised power grids. One of the problems with this approach is that the projects are very expensive. For example, one rural electrification project, carried out in Indonesia in 1994–1996, consisted mainly of extending distribution lines to 851 villages at a cost equivalent to US$130 million in 2010. Another problem, as the Alliance for Rural Electrification explains, is that rural areas “are often too sparsely populated or have a too low potential electricity demand to justify the extension of the grid,” which means that these projects, if carried out at all, cannot penetrate all rural areas.

However, several projects recognise the need for a different solution, and have instead sought to provide electricity access through local means of electricity generation, usually utilising renewable energy technology. This allows electricity access to penetrate remote areas more easily, without requiring massive investments in extending the centralised distribution grids.

The Global Sustainable Electricity Partnership has initiated a number of these projects, including one project in Indonesia and one in the Philippines. The project in Indonesia was a multi-pronged approach in the island of Sulawesi, involving the installation of three micro-hydro power systems which covered roughly 2,500 people, 175 solar home systems in three villages, and a photovoltaic/wind hybrid system on Rote Island that provides coverage to roughly 600 people. The project also entailed setting up and training a number of village-run electricity cooperatives to manage and maintain these systems. In the Philippines, the organisation built a 200kW hydropower plant in Ifugao province in order to aid efforts to preserve the Ifugao Rice Terraces World Heritage Site and to provide electricity access to the local agricultural community around it.

Another fast-growing technology is the use of various forms of waste to power electricity generators. Previous issues of this bulletin have discussed the potential of electricity generation using agricultural waste such as rice husks in Thailand. These waste-powered electricity technologies have also popped up in farms in Malaysia in the form of biogas plants that utilise animal manure, as well as in some urban areas like Jakarta and Ho Chi Minh City that are also trying to solve the problem of urban waste management.

Although the projects highlighted above were mostly implemented by non-government actors, there are also some governments that have decided to follow the same route of using renewable energy to provide off-grid electrification.

China launched very ambitious rural electrification programmes using renewable energy in the past decade. It started with the Township Electrification Programme in 2001, which installed a total of 20MW of solar photovoltaic capacity, 200MW of small hydroelectric capacity, and 840kW of wind power to over 1,000 townships. After the completion of this programme in 2005, it continued to expand its rural electrification programme with the Village Electrification Programme, which aims to provide renewable electricity to 10,000 villages. India has recently followed suit, setting up a solar energy plan that aims to provide solar lighting to 20 million rural households by 2022.

The main barrier to the interventions above is that, although these projects are more efficient and have a wider reach than the “traditional” grid expansion method, the generators still require sizeable investments. For example, China’s Township Electrification Programme cost a total of RMB 1.6 billion in total, or about US$250,000 per township (assuming an equal distribution of resources). Thus, there will still be difficulties in funding the replication of these projects throughout the parts of ASEAN that need them most.