Expanding access to electricity
Understand the relationship between economic development and access to energy.
In this course, students visit two African countries to better understand the electricity-development-climate nexus.
Morocco, the westernmost country in North Africa is mainly reliant on fossil fuel for electricity production, most of which is imported. However, Morocco has significant potential for both solar and wind and has established ambitious renewable energy objectives. Per capita, electricity consumption is around 900 kWh per year.
Ghana, located in West Africa on the Atlantic coast, struggles with electric supply reliability and is attempting to improve this situation. About half of Ghana’s electricity supply comes from fossil sources, with the balance coming from renewables, most of it hydroelectricity. Ghana has also established renewable energy targets but has goals for improving rural energy access and overall supply reliability, as well. Per capita electricity consumption in Ghana is around 320 kWh per year.
This course gives students an opportunity to explore the following questions:
- How can developing nations expand access to electricity for all segments of their economies?
- What is the relationship between economic development and energy access?
- What role should renewable resources and energy storage technologies play in expanding energy access?
- How should international efforts to mitigate global climate change be factored into the decisions of developing nations?
- What financial and commercial models are being used to increase energy access in developing economies?
- What is the relationship between government policy and energy access in developing economies?
- What tools can help us understand the economics, investment needs, and political ramifications of these intertwined issues?
Electricity is a critical element of industrialized life — perhaps the most critical. Without it, nothing else works. Water, sanitation, food, healthcare, education, entertainment: without power, these activities grind to a halt.
There are roughly 1.5 billion global citizens who have no electricity at all. There are another couple of billion whose access is inadequate. There is a strong relationship between energy usage and economic well-being. Reliable, cost-effective electricity is widely seen as a necessary precursor to economic development.
In the OECD — the coalition of 36, mainly Western, developed economies — per capita electricity consumption is around 8,000 kilowatt-hours (kWh) per year. By contrast, in North Africa, this figure is closer to 1,600 kWh per year. And in sub-Saharan Africa, the average is a mere 500 kWh/year. These stark differences are mirrored by similar gaps in per capita GDP and income.
By 2050, the world is expected to need about twice the total energy we now consume. Almost all this growth is expected to take place in developing economies, and for this development to occur, the electricity supply will need to be vastly expanded. In the past couple of decades, the economy of China has roared ahead. Chinese GDP and income per capita have grown, along with a vast expansion of energy supply, much of it in the form of electric power. Many developing nations aspire to follow the Chinese path.
A different drama is playing out in the developed world, but one that has implications for developing economies.
Electricity markets in the developed world are in the midst of a transformation that began in the late 1970s. At that time, nations and states began to change the ways in which electricity markets are structured and regulated, with the goal of increasing competition and reducing monopoly. Technology has evolved, and the development and deployment of new supply-side technologies (including renewables) are also the main drivers of transformation. Innovations on the demand side, such as energy efficiency, demand management, energy storage, and “smart” technologies, are also key agents of change. Finally, environmental regulations have altered the landscape, and efforts to reduce man-made greenhouse gas emissions have moved to center stage in the global political theater.
The most aggressive deployment of renewable energy has occurred in the developed world, best exemplified by Germany and several U.S. states, including California and Texas. In the same vein, the most aggressive policies aimed at reducing emissions linked to climate change have also emanated from the developed West. There is often an explicit link assumed between these initiatives. Renewable energy is assumed to equal climate mitigation. There is also an assumption that international economic development must occur in a way that does not adversely affect the global climate. In fact, there are advocates who would argue that energy options for developing nations should be restricted to wind, solar and storage.
There is tension between the behavior and policy objectives of the wealthy West and the poorer, developing world; one of the key objectives of this course will be to better understand the dimensions of this tension.
Faculty and advisor bios
Stephen Brick has worked for more than 30 years at the intersection of energy and environmental policy; his expertise includes utility regulatory policy, energy economics, energy technology assessment, and air pollution control policy and economics. Since 2009 he has been a senior fellow in climate and energy at the Chicago Council on Global Affairs and senior advisor in technology and policy at the Clean Air Task Force.
From 2005 to 2009, Mr. Brick served as the manager of the environment program for the Joyce Foundation in Chicago. In this capacity, he directed a $6 million per year grant portfolio focused on energy and water issues in the Great Lakes region. Previously he served as research director at the Energy Center of Wisconsin, where he was responsible for a wide range of studies on energy efficiency, renewable energy and on the environmental impacts of energy systems. Other experience includes being director of environmental affairs for PGE National Energy Group, science and policy director for the Clean Air Task Force, and co-founder and vice president of the energy consulting firm MSB Energy Associates. He received his B.A. and M.S. from the University of Wisconsin-Madison.
Arlene Johnson is the senior director of Executive Education operations at the Kellogg School of Management. Her staff of 15 is responsible for the delivery of over 130 Executive Education programs per year with over 5,000 executives in attendance. She is currently on special assignment in the dean’s office.
After coming to Kellogg in 2007 as a program manager, Arlene was promoted to assistant director in Alumni Relations. There she was responsible for working with both Kellogg faculty and alumni groups to bring programming directly to our alumni. She returned to Executive Education in 2011. Before coming to Kellogg, Arlene held management positions in operations and finance at several companies, including Quaker Oats and Agfa-Gevaert.
Arlene has served as an advisor for EMBA GIM China, GIM Latin America (twice), GIM Social Impact: Nicaragua and GIM Energy: Europe.