Months after Hurricane Maria hit Puerto Rico, 48 percent of the island’s power grid remains offline. Only 75 percent of Puerto Rico is expected to have power by the end of January. The United States territory may have been plunged into darkness since the tropical storm, but it is also now on the radar of solar power providers competing to shape the island’s electrical future. Once reliant on an outdated power grid and imported fossil fuels, Puerto Rico now has an opportunity to build an integrated system of renewable mini grids and backup batteries from scratch. Last month, Tesla began building a solar generation and storage facility in Puerto Rico to power a single hospital, but demand for power outstrips supply.
African markets are all too familiar with these conditions, but countries with little power infrastructure are now turning to accessible, more resilient off-grid electricity solutions. Puerto Rico, now an electrical blank canvas, should learn from African markets about cutting ties with fossil fuels, building off-grid from the start, and looking to public-private partnerships for a system-wide rollout.
Dependence on imported fossil fuels leaves Puerto Rico vulnerable to unpredictable supply. With the U.S. cutting coal power use by 45 percent in favor of less expensive alternatives like natural gas, Puerto Rico cannot afford its continued reliance on energy sources that are being phased out on the mainland. 1.2 billion people, including 620 million Africans, already live without access to the fossil fuel electrical grid; when a supplying country stops providing fuel to a reliant importer, economic, and social instability are sure to follow.
But in-country reliance on fossil fuel pipelines can also pose challenges: Nigeria lost $8.4 billion in revenue when a rebel group in the Niger Delta attacked the country’s pipelines in 2016. Greater reliance on renewables can alleviate these anxieties. Countries such as Cape Verde are leading the way in the region, by pledging to be 100% renewable by 2025. Thanks in large part to Chinese imports, solar PV panels are cheaper than ever: With prices falling 80 percent between 2010 and 2015, solar is set to become the most cost-effective energy source over the next decade. With more sunshine than states such as California, Puerto Rico is in a position to end its relationship with dirty power and develop an independent energy strategy.
Q&A: Finance hurdles for mini grid projects in Africa
Expanding mini grid systems across Africa could help to electrify rural populations. But these projects often aren’t attractive to investors. Devex spoke with Pepin Tchouate, with Power Africa, about the particular challenges mini grid project developers in East Africa face in attracting funding.
Where renewable sources are abundant, governments should build integrated mini grids from the start. Industrialized countries such as Iceland and Norway get nearly all of their electricity from renewable sources, but African markets are following suit. Mini grids, which operate at a fraction of the scale of utility systems, are transforming villages from Tanzania to Equatorial Guinea. These modular power systems are expected to bring power to 120 million people in African regions without electricity.
Puerto Rico, at this critical point, should emulate countries that have adopted mini grid systems rather than a single, utility-scale platform. Utility-scale projects are expensive and require a long time investment to complete, making this a prohibitive option for post-hurricane Puerto Rico. Avoiding reliance on one main power provider, such as scandal-ridden Puerto Rico Electric Power Authority — which was going bankrupt prior to the disaster — could improve resilience during future hurricane seasons and help rollout electricity across the island, particularly in hard-to-reach places already off the grid.
In African countries, the majority of the solar investments are funded or backed by multilateral organisations as government subsidies dwindle. Egypt, for example, has attracted $1.8 billion in solar investment, with major investments coming from the European Bank for Reconstruction and Development and the International Finance Corporation. Italy’s Enel is investing $120 million in an partnership with the Ethiopian government to build a 100 megawatts solar farm, and developing a solar and wind power microgrid for 100 villages in western Kenya. South Africa has one of the most developed regulatory frameworks, the South African Renewable Programme, whose clarity and predictability have helped the country retain its status as one of one of the world’s most promising renewable energy markets. However, Africa’s most pressing challenge executing renewable power projects is an irregular regulatory framework that discourages investment.
Like energy-starved Africa, Puerto Rico can be a model for green growth by trading vulnerable centralized electrical grids for cost-effective, modular, off-grid systems. Rather than waiting for an outmoded and overdue energy intervention from the mainland, Puerto Rico should look to the African markets launching sustainable mini grid systems backed by public-private partnerships. Restoring Puerto Rico’s power systems to their prehurricane state does a disservice to the people and leaves the island vulnerable to the next natural disaster. But a forward-looking Puerto Rico will let go of the grid as it was and embrace proposals by renewable energy providers who see the future as it should be.