The Coordinator’s Corner: September 2016
Notes from the Field
Friends,
It’s been a fantastic end of our summer and first few weeks of fall. So much has happened in the last several months: In case you missed the news, President Obama highlighted Power Africa in his speech at the U.S.-Africa Business Forum in New York City where we also announced more than $1 billion in new commitments to real deals, we released our Annual Report and the new Power Africa video, we added Japan as a new Power Africa partner, and the MCC Compact in Ghana entered into force on Sept. 6!
The Annual Report
This year’s Annual Report is the best of the three in my opinion for a few reasons. First, it shows in a very concise manner how each of Power Africa’s U.S. Government partners and several of our development and private sector partners are producing results. It also shows how all these efforts tie together. The performance of each agency and partner exceeds what was initially expected or envisioned. Power Africa is hitting its stride. We just need to continue helping get deals across the finish line and adding more connections.
MCC Ghana Compact
The Ghana Power Compact entered into force on Sept. 6. MCC expects to begin disbursement of Compact funds in October. On Aug. 30, the RFP for the Electricity Company of Ghana (ECG) concession was released to the six shortlisted bidders. Congratulations.
Japan is Power Africa’s Newest Partner!
At the Tokyo International Conference on African Development (TICAD) VI meeting in Nairobi, Kenya on Aug. 25, USAID Assistant Administrator for Africa Linda Etim, on behalf of Power Africa, signed a Memorandum of Cooperation (MOC) with the Government of Japan. The MOC outlines intended areas of cooperation, including advancing geothermal in East Africa, improving energy efficiency efforts, and supporting cross-border energy trade and regional power pools. Japan also committed to bringing online an additional 1,200 MW by the end of 2018. We’re thrilled with this new partnership.
U.S.-Africa Business Forum
Along with Bloomberg, the Department of Commerce did an excellent job in organizing the second U.S.-Africa Business Forum on Sept. 21. Speakers included African heads of state, Power Africa partner CEOs (including Brian Herlihy of Black Rhino and Jasandra Nyker of Biotherm), U.S. Cabinet Secretaries and the President of the United States. During his remarks, President Obama highlighted how Power Africa now has more than $52 billion in commitments and more than 130 partners. Throughout the day, we met with many of those 130 partners, sometimes linking them directly with heads of state and with one another to try to advance deals.
U.S. Department of Energy (DOE) Liquified Natural Gas (LNG) Roundtable
Perhaps my favorite meeting of UNGA week was one that DOE Assistant Secretary Chris Smith convened in a small, closed-door session with African ministers of petroleum. We had participants from Ghana, Mozambique, Cote d’Ivoire, and South Africa. The conversation focused on what would be most useful to them in the drafting of a Power Africa handbook on the LNG sector — the third handbook in Power Africa’s Understanding series. The first was Understanding Power Purchase Agreements (PPAs) and the second Understanding Power Project Financing. Each of the African partners agreed to designate a knowledgeable official to participate in the drafting process.
USTDA Climate Change Event and Grant Signing
As part of the 8th Annual NYC Climate Week at UNGA, USTDA Director Lee Zak announced a grant for a feasibility study in support of the development of the 40 MW Isiolo Solar Plant in central Kenya. Following the grant signing between USTDA and Kenyan developer Greenmillenia Energy, Director Zak moderated a panel on Unlocking Clean Energy Investment in sub-Saharan Africa that featured renewable energy developers from Kenya and the United States. A total of six USTDA grants for Kenyan developers were announced in New York last week, representing over 200 MW of potential power for homes and businesses and making Kenya USTDA’s largest portfolio in Africa.
Commerce African Growth and Opportunity Act (AGOA) event on Power Africa in Washington
At a recent event that Commerce’s Commercial Law Development Program (CLDP) hosted with the law firm of Hunton & Williams in Washington, D.C., we heard from lawyers and project developers about the obstacles they face in advancing projects in sub-Saharan Africa. The event featured CLDP’s great work in leading the drafting of the two Power Africa handbooks on PPAs and on project finance.
Women in African Power Event in Nairobi
More than 40 women participated in a successful Women in Energy luncheon at the East African Power Industry Convention (EAPIC) on Sept. 21 in Kenya. Co-hosted by Power Africa’s Women in African Power and the African Development Bank (AfDB), the event featured speakers Karen Freeman, USAID Kenya’s mission director; Geraldine Joslyn Fraser-Moleketi, Special Envoy on Gender at the AfDB; and Charity Wanjiku, CEO of Strauss Energy. The luncheon shined a light on the role that women play in Africa’s energy sector, and the tremendous potential they hold to shape a vibrant and growing sector.
Power Africa Video
The new Power Africa video, filmed in Rwanda, does a superb job of showing the breadth of our work — State and Commerce Department advocacy for ContourGlobal’s KivuWatt methane extraction project, USTDA grants for mini-hydro projects, our partner Gigawatt Global’s development of the first grid-scale solar project in East Africa, as well as the innovative work that our off-grid partners BBOX and Mobisol are doing to add thousands of new off-grid connections each month. Enjoy!
Currency Risk Webinar
Foreign Exchange Risk (“FX Risk”) is a key inhibitor of capital inflows and deal progress for the power sector in Sub-Saharan Africa. It is an issue of interest for African utilities, independent power producers, finance ministries, and developers. FX risk is rising due to volatile and declining commodity prices, uncertain macro-adjustments, and a potential eventual reversal in a record-low hard currency interest rate environment. SEforALL, Power Africa and TCX have partnered to conduct a series of webinars on this topic, building upon initial outreach by Power Africa and TCX from a workshop at the 2016 Africa Utility Week. Catch the recap of the currency risk webinar here.
Everyone should take some time to reflect on what we’ve achieved in the last three years and feel proud. Many of our partners have been telling us about our value in helping them overcome obstacles to their deals, whether it involved flagging an issue for the president of a country for resolution or helping identify financing or project development capital. Our private sector and host government partners greatly appreciate what we’re doing. And our development partners see how we are making progress by pulling everyone together on specific deals and in countries to work towards reform. I look forward to seeing what the next three years will bring!
Best,
Andy
About the Author
Andrew Herscowitz is the Coordinator for Power Africa. Follow him on Twitter @aherscowitz. Follow Power Africa on Facebook and Instagram.
