08 April 2024 Energy News issue - 1714 by Khaled Al Awadi_compressed.pdf

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NewBase Energy News 08 April 2024 No. 1714 Senior Editor Eng. Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oman is quietly planning to be a major green hydrogen exporter
The National - John Benny + NewBase
Oman is quietly positioning itself as a global hub for green hydrogen exports, as many
countries in the Middle East turn to the clean fuel as a way to transition to a more
sustainable energy future.
The sultanate, better known as an oil exporter and a regional tourist destination, is
developing several large green hydrogen projects that aim to decarbonise its industries
and export low-carbon ammonia to other markets.
Duqm port, Oman. The sultanate aims to produce one million tonnes of green
hydrogen annually by 2030. Reuters
Green hydrogen is produced through a process called electrolysis, in which water is
split into hydrogen and oxygen using electricity generated from renewable
sources.Oman's location, coupled with its abundant solar and wind energy resources
and vast land availability, makes it an ideal candidate to produce the low-carbon gas.
ww.linkedin.com/in/khaled-al-awadi-80201019/
Green Energy Oman, one of the largest green hydrogen projects
proposed in the sultanate, will begin operations in the early part of
the next decade

"Oman boasts some of the world's most suitable locations for solar and wind power
generation, key ingredients for producing low-cost green hydrogen through
electrolysis," Andrea Zanon, chief executive of WeEmpower Capital, told The National.
"This green hydrogen can then be transported through Oman's existing 4,000km gas
pipeline network, significantly reducing infrastructure costs compared to starting from
scratch.
"Furthermore, Oman's extensive experience in processing and exporting liquefied
natural gas (LNG) and ammonia translates directly to efficiently managing green
hydrogen and its derivatives."
The sultanate, which is the second-largest LNG exporter in the Middle East after Qatar,
aims to produce at least a million tonnes of renewable hydrogen a year by 2030 before
increasing capacity to 3.75 million tonnes by 2040.
By 2050, Oman plans to have a green hydrogen capacity of 8.5 million tonnes, greater
than Europe's current hydrogen demand of about 8 million tonnes.
The International Energy Agency expects the Gulf country, which sits on key trade
routes between Europe and Asia, to become the sixth-largest exporter of hydrogen
globally and the largest in the Middle East by 2030.
Europe and Australia will collectively represent nearly 50 per cent of production for all
green hydrogen projects scheduled for 2030, the Paris-based agency has said.
The biggest game-changer in Oman's hydrogen sector came last year when Hydrom,
a state-run company, signed six agreements worth $51 billion to invest in green

hydrogen projects. These were signed with companies from Belgium, the Netherlands,
the UK, Japan, Singapore, Germany, India, Kuwait and the UAE. "These investments
were the results of almost a decade of negotiations and tech development, which now
give Oman a big regional first-mover advantage," Mr Zanon said.
Projects under development
One of the projects in the pipeline is Hyport Duqm, a joint venture between Belgium’s
DEME Group and Oman’s state energy company OQ.
In its recently published annual report,
DEME said the project would be
among the first globally to produce
green hydrogen and ammonia. The
company aims to kick-start its next
stage of development this year,
following a project development
agreement signed with Oman's
national hydrogen company, Hydrom,
last year.
It was not clear whether the companies
had accelerated the timeline for
completing the project. Hyport Duqm
and OQ were not immediately
available for a comment.
Hyport Duqm previously announced
that the first phase would produce
more than 50,000 tonnes of green
hydrogen annually by 2029, resulting
in about 330,000 tonnes of ammonia
output. In the second phase of the
project, green ammonia production is
expected to reach 650,000 tonnes.
The facility will utilise 1.3 gigawatts of
combined wind and solar energy in the
first phase, potentially increasing to
more than 2.7 gigawatts in the second
phase.
Meanwhile, Green Energy Oman (GEO), one of the largest green hydrogen projects
proposed in the sultanate, is scheduled to begin operations in the early part of the next
decade.
The project, developed by an international consortium with Shell as its lead operating
partner, is expected to produce 1.8 million tonnes a year of hydrogen at full capacity,
the London-based oil major said in its Energy Transition Strategy report.

GEO will produce hydrogen from seawater. The project will be powered by up to 25
gigawatts of solar and wind energy.
Initial challenges
Despite hydrogen’s growing potential, critics within the energy industry have
underlined its high cost of production and the absence of a well-established market.
Trading hydrogen through short-term contracts in a way similar to commercial crude
oil and LNG is "a challenge", given the long-term nature of investment required for
projects, Frank Wouters, chairman of the Mena Hydrogen Alliance, told The National in
an interview in February.
Mr Wouters, former deputy director general at the International Renewable Energy
Agency (Irena), said "decoupling" the supply of hydrogen from demand through a
strategic reserve would help create liquidity in the market.
"Let's say we create a strategic reserve of 5 million tonnes, so then immediately you
have a pool to feed into," he said. "All the producers can first fill that reserve [and] it's
not money out the door because you can also sell out of it."
But the more immediate challenge facing the industry is green hydrogen's much higher
cost of production compared with fossil fuel-based energy sources.
In parts of the Middle East, Africa, Russia, and the US, green hydrogen production
costs can range from $3.23 per kilogram to $5.38 per kilogram, while in Europe, it can
cost as much as $8.60 per kilogram, according to estimates from PwC and the Boston
Consulting Group.
Currently, almost most all hydrogen produced worldwide is "grey", which means it is
produced from natural gas. The production of grey hydrogen costs only around $1.08
to $2.15 per kilogram, but the process is significantly more carbon-intensive.
"There's still a cost gap and we need to stimulate the market like we did for renewables
until it's cost competitive. The governments need to do an extra step," Mr Wouters
said.
In the oil-rich Gulf region, solar energy has become highly competitive in recent years,
thanks to supportive government policies and falling equipment costs. This has paved
the way for green hydrogen.
At less than 2 cents per kilowatt hour, solar PV is the cheapest option for electricity
production in the Gulf, outpacing natural gas, liquefied natural gas, oil, coal and nuclear
power, according to the Irena.
“Plummeting generation costs and abundant solar and wind resources in the region
open the door for innovative energy technologies, such as green hydrogen, to be
produced competitively,” the Abu Dhabi-based agency said in a December report.

Although there are several projects in the pipeline, renewables accounted for only 3
per cent of the GCC region's electricity generation capacity in 2022, with installed
renewable power capacity reaching 5.6 gigawatts, the Irena report said.
Renewable capacity in the region needs to increase to almost 40 to 60 gigawatts – a
nearly 60-fold rise – by 2030 to meet the region’s hydrogen targets, according to the
Middle East Institute.
"The success of Oman's plans hinges on the global market's appetite for hydrogen,"
Mr Zanon said. "Favourable carbon pricing, particularly in Europe, for instance, would
incentivise countries to import green hydrogen.
"Additionally, Oman faces competition from other green hydrogen producers, including
Saudi Arabia and the UAE, making cost competitiveness a crucial piece of the Omani
advantage."
Even as regional competition heats up, Oman is on track to supply more than 60 per
cent of the total hydrogen exports from the Middle East by the end of the decade, the
IEA said.
The sultanate will be followed by the UAE, which is expected to account for 20 per cent
of the exports, and Saudi Arabia, with a 16 per cent market share.
Saudi Arabia, the Arab world's largest economy, is investing heavily in renewable
energy projects as part of its plan to diversify from crude exports.
The kingdom is developing the $8.4 billion Neom green hydrogen project, which will
integrate up to 4 gigawatts of solar and wind energy to produce up to 600 tonnes per
day of carbon-free hydrogen by the end of 2026 in the form of green ammonia.

Meanwhile, the UAE is planning to build at least two hydrogen production hubs, or
oases, by 2031. The Emirates aims to produce 1.4 million tonnes of hydrogen annually
by that year.
The global hydrogen trade is projected to generate more than $280 billion in annual
export revenue by 2050, with North Africa expected to benefit the most due to its high
export potential, according to Deloitte.
Mr Wouters said the conversation around green hydrogen had become “more
nuanced” in recent years, with countries finding applications for the fuel in their own
industries.
“Part of the recent thinking is also looking at domestic use of hydrogen, and that could
have many forms,” he said. “You could use hydrogen in traditional ways where you
use hydrogen to get sulphur out of fuels, but you can also produce green steel with
hydrogen."
Oman is developing a $3 billion green steel plant in a special economic zone, in the
southern port city of Duqm.
The project, which is expected to process five million tonnes of steel a year, will cater
to the automotive, electrical tools and wind turbine industries.
Renewables pivot
Oman aims to achieve net-zero emissions by 2050 but the country's transition to clean
energy is also motivated by challenges in its oil and gas industry.
The country's economy remains dependent on the oil sector, which accounts for about
30 per cent of its GDP, 60 per cent of goods exports and 75 per cent of government
revenue.
While natural gas has fuelled Oman's economic growth, its resources are now showing
signs of depletion. At the same time, the increasing uptake of electric vehicles and
solar energy is pushing peak oil demand into view.
"While short term [oil] production will increase revenue, Oman has an incentive to
continue to be the first mover in clean energy development as it does not have the
cheap oil and gas resources to fuel its economy and employ its young population," Mr
Zanon said.
"Oman will continue to invest in its expansion of its ammonia export infrastructure and
electrolysis, sending a strong market signal to consumers and hydrogen partners."
Oman’s aim to expand domestic green hydrogen production could support its GDP,
fiscal revenue and the balance of payments over the long term, Fitch Ratings said in
a report in December.
The sultanate's economy is estimated to have grown by 1.3 per cent last year, down
from 4.3 per cent in 2022, due to Opec+ oil production cuts, the International Monetary
Fund said in November.

Kuwait seeks bids for 1,100MW Al Dibdibah-Al Shagaya project
TradeArabia News Service
The Kuwait Authority for Partnership Projects (KAPP) has - in collaboration with the Ministry of
Electricity & Water & Renewable Energy (MEWRE) of Kuwait - issued requests for qualification
(RFQs) to the developers/developer consortia for the Al Dibdibah Power and Al Shagaya
Renewable Energy (Phase III) Zone 1 Solar PV Independent Power Project (IPP).
A renewable power facility, the Al Dibdibah Power and Al Shagaya plant lies within the
administrative boundary of Jahra Governorate in the west of Kuwait City, approximately 100km from
the capital. On completion, it will boast a net power capacity of 1,100MW.
According to KAPP, the winning consortium will be responsible for the development, financing,
design, procurement, engineering, construction, testing, commissioning, operation, maintenance as
well as transfer of the key Al Dibdibah Power and Al Shagaya Renewable Energy project.
KAPP said the project will export the output from the plant to Kuwait’s electricity grid and
transmission network. It will benefit from power purchase agreement (PPA) with MEWRE as the off
taker for a 30-year term.
As the main body responsible for implementation of the public-private-partnership projects, KAPP
aims to utilise private sector skills and expertise to maximize value for money and service quality.
Both KAPP and Ministry of Electricity & Water & Renewable Energy were assisted in the project by
Ernst & Young as lead and financial advisor, DLA Piper as legal advisor and DNV as technical and
environmental advisor.-

Egypt in Talks to Lease New LNG Terminal as Imports Pick Up
Bloomberg Salma El Wardany and Anna Shiryaevskaya
Egypt is planning to lease a natural gas import terminal as it steps up overseas purchases in a bid
to avoid energy shortages this summer.
The state-run Egyptian Natural Gas Holding Co. is in talks with providers of floating storage and
regasification units, according to two people with knowledge of the matter, who asked to be identified
because the talks are private. EGAS is looking for a five-year contract that can be extended, one of
the people said. Egypt oil ministry officials didn’t respond to phone calls seeking comment.
EGAS recently bought at least one LNG shipment for delivery in the next month and is looking for
several more, traders with knowledge of the plan said earlier. The country, which uses gas for
cooling to escape extreme heat, is securing supply this early in the year to potentially avoid the
chronic power blackouts of last summer.
The imported cargo will be routed through an existing facility in Jordan, after a deal between the
two countries last year to jointly use a
terminal in Aqaba. Cairo’s lease of
another floating storage and
regasification unit, the BW Singapore,
ended last year.
Egypt’s LNG imports mark a major
shift after it largely stopped purchasing
the fuel in 2018 when the massive
Zohr field boosted domestic
production and turned the country into
an exporter of the fuel. Local gas
output, however, has dropped to the
lowest level in years, which Oil
Minister Tarek El-Molla said in
February was because of natural
decline at its fields.

U.S: Solar eclipse will briefly limit solar electricity generation
across the country U.S. EIA, Preliminary Monthly Electric Generator Inventory, February 2024
On April 8, 2024, a full solar eclipse will briefly but fully obscure sunlight to utility-scale solar
generation facilities from Texas through Maine with a combined 6.5 gigawatts (GW) of capacity. In
addition, the eclipse will partially block sunlight to facilities with a combined 84.8 GW of capacity in
an even larger swath of the United States around peak solar generating time.
Solar-powered generators centered in the path of totality—where the moon will completely obscure
the sun—will be affected the most because the moon will block all direct sunlight for more than four
minutes. The partial eclipse could limit the sunlight in the path of totality for more than two hours.
Areas around the path of totality will have varying levels of diminished solar generation during the
eclipse.
Because we know about the eclipse ahead of time, utilities have prepared and planned for the lost
solar energy. Several grid authorities have released plans for how they plan to deal with the change
in solar generation during the eclipse. During the eclipse, electricity generators in the affected areas
will have to increase output from other sources of electricity generation to supplement the decrease
in solar power.
The solar eclipse will challenge electricity grids in two ways. First, utility-scale solar generation of 1
megawatt (MW) or greater, much of which is managed by balancing authorities, will have lower solar
output along the path of the eclipse.
System operators will respond by dispatching other generating resources. Homes and businesses
that use small-scale solar will also require more electricity from the grid than usual. Because small-
scale solar is not managed by balancing authorities, the increased demand from these homes and
businesses will likely appear as an overall power demand increase on the electricity grid rather than
a shift from solar power to grid power.

Second, battery storage is a significant factor in the grid’s response to the eclipse. Battery storage
helps balance the electricity system by absorbing excess solar or wind generation when demand is
low and then discharging it when demand is high. In the United States, we have 15.4 GW of battery
storage. During the last solar eclipse, in 2017, only 0.6 GW of battery storage was operating in the
United States.
Texas will lose the most solar generating capacity because most of the state is in the path that will
lose 90%–99% of solar power during the eclipse. Although most of California is in the 40%–59%
partial reduction range, the state’s significant use of utility-scale and small-scale solar capacity
makes the eclipse’s impact more significant. Florida is noteworthy because when the eclipse
occurs, solar generation is likely to be the second-leading energy source on the system and account
for about 20% of the state’s total generation.
Solar electricity capacity has grown rapidly in the United States since the 2017 solar eclipse,
especially in Texas. Utility-scale solar capacity was 8% (91 GW) of total U.S. capacity at the end of
2023. Solar power can be the third-largest source of midday generation in the United States during
the spring and summer months. Solar is the largest source of midday generation in California and
the second-largest source of midday generation in Texas, Florida, other parts of the East Coast,
and in the Southwest.
The effect of the 2017 solar eclipse on the power system was minor. Since then, however, the U.S.
electricity portfolio has changed significantly; almost 100 GW of utility-scale and small-scale solar
capacity has been added to the system.
During the 2017 eclipse, solar generation was the fifth-leading energy source in the United States
behind natural gas, coal, nuclear, and hydroelectric. Even with the eclipse, we still expect solar
generation to be the third-largest contributor of electricity in the United States on April 8, behind
natural gas and nuclear.

German coalition agrees financing details of hydrogen network
Reuters By Riham Alkousaa and Markus Wacket
Germany's ruling coalition on Friday agreed a financing mechanism for the country's future
hydrogen network, extending a deadline for it to be built by five years to 2037 and offering protection
for investors in case of bankruptcy.
Many countries are betting on hydrogen, which can be used in part to replace natural gas, as they
seek to decarbonise their economies and find ways to absorb intermittent renewable supplies into
the power grid. Germany, which was heavily reliant on Russian gas until the Ukraine war began, is
especially keen to shift towards hydrogen.
German Economy and Climate Minister Robert Habeck points at a map showing Germany's
hydrogen network during a press conference in Berlin, Germany, November 14, 2023.
REUTERS/Fabrizio Bensch/File Photo Purchase Licensing Rights, opens new tab
The country's core network for hydrogen fuel will extend over 9,700 km (6,000 miles) and cost
around 20 billion euros ($21.6 billion), with existing gas pipelines making up 60% of the network.
The energy policy lawmakers of the government's three coalition parties on Friday agreed on the
network's details that will be discussed and are expected to be agreed by the lower house of
parliament next week, the lawmakers said in a joint statement.
According to the agreement, the network should be in place by 2037 at the latest, five years beyond
the original deadline to try to ease the financial burden for the operators, lawmaker for the Social
Democrats Nina Scheer said.

The project will be financed through user fees and built by private companies, and to encourage
investment in technology that is in its infancy, the network operators will not be liable if one operator
goes bankrupt, with a government guarantee of around 6.7% return on equity before taxes.
The Economy Ministry has been considering what it refers to as an amortisation account to cover
the network construction costs over a long period to avoid passing the full amount to current
consumers, with plans to have the costs paid back by 2055.
If, however, demand is weak and the market fails to take off, network operators will have to shoulder
some 24% of the costs, the parties agreed. "The federal government is only partially liable in the
unlikely scenario that the core network ramp-up fails," the agreement said.
The BDEW utilities lobby welcomed the agreement but said investors should be offered more
security against the loss of capital. "The litmus test will be whether or not actual investment decisions
are made on the basis of the agreement," Germany's association of local utilities, VKU, said in a
statement.

NewBase April 08 -2024 Khaled Al Awadi
NewBase for discussion or further details on the news below you may contact us on +971504822502, Dubai, UAE
Oil slides more than 1% as Middle East tensions ease
Reuters + NewBase
Oil prices slid more than $1 a barrel on Monday, with Brent falling below $90, as Middle East
tensions eased after Israel withdrew more soldiers from southern Gaza and committed to fresh talks
on a potential ceasefire in the six-month conflict.
Brent crude futures dropped $1.48, or 1.6%, to $89.69 a barrel by 0615 GMT.
U.S. West Texas Intermediate crude was at $85.54 a barrel, down $1.37, or 1.5%.
"It appears the catalyst is Israel saying it has withdrawn all troops except one brigade from the
Southern Gaza strip, likely in response to growing international pressure and to deescalate tensions
after it killed senior Iranian commanders in Syria last week," IG market analyst Tony Sycamore said.
Auckland-based independent analyst Tina Teng said: "This could be just a temporary pullback as
the event did not offer any fundamental changes."
Oil price special
coverage

Israel and Hamas sent teams to Egypt for fresh talks on a potential ceasefire ahead of the Eid
holidays, easing tensions in the Middle East that drove up oil prices by more than 4% last week on
concerns of supply disruption.
Israeli Defence Minister Yoav Gallant said on Sunday that Israel is ready to handle any scenario
that may arise with Iran, after Tehran threatened to retaliate for the killing of Iranian generals on
April 1.
The world's top oil exporter, Saudi Arabia, raised official selling prices for all crude grades to Asia
in May, in line with expectations, after heavy oil supply tightened.
Fire struck an offshore platform operated by Mexico's national oil company Pemex on Saturday,
killing at least one contractor. This comes after Pemex requested its trading unit to cancel up to
436,000 barrels per day of crude exports in April.
However, Goldman Sachs analysts expect Brent to stay below $100 a barrel in its base case
scenario that assumes already solid demand, no further geopolitical hits to oil supply and that
elevated spare capacity will lead OPEC+ to raise production in the third quarter.
In the United States, oil rigs rose by two to 508 last week while gas rigs fell by two to 110, the lowest
since January 2022, Baker Hughes (BKR.O), opens new tab said in its report on Friday.
The U.S. employment report on Friday beat expectations, suggesting the economy ended the first
quarter on solid ground and potentially delaying anticipated Federal Reserve interest rate cuts this
year.
The Fed may push out rate cuts amid strong U.S. economic data and a tight labour market, Teng
said.
Investors will be scouring consumer price index data from U.S. and China due later this week for
further clues on the timing of possible Fed rate cuts and to gauge the economic health of the world's
top two oil consumers.
US drillers cut oil and gas rigs for third week in a row - Baker Hughes
U.S. energy firms this week cut the number of oil and natural gas rigs operating for a third week in
a row for the first time since October, energy services firm Baker Hughes (BKR.O), opens new
tab said in its closely followed report on Friday.
The oil and gas rig count, an early indicator of future output, fell by one to 620 in the week to April
5, the lowest since early February. Baker Hughes said that puts the total rig count down 131, or
17%, below this time last year.
Baker Hughes said oil rigs rose two to 508 this week, while gas rigs fell by two to 110, their lowest
since January 2022.
Israel withdrew more soldiers from southern Gaza
Israel, Hamas send teams to negotiate potential ceasefire
Saudi Aramco hikes May crude prices for Asia
US added 2 oil rigs last week - Baker Hughes

A drop in natural gas prices to a 3-1/2-year low earlier this year caused drillers to cut the number of
gas rigs operating in the Haynesville shale gas field in Louisiana, Texas and Arkansas. Baker
Hughes said the basin lost two rigs this week, leaving just 34 rigs active, the lowest since August 2020.
The oil and gas rig count dropped about 20% in 2023 after rising by 33% in 2022 and 67% in 2021,
due to a decline in oil and gas prices, higher labor and equipment costs from soaring inflation and
as companies focused on paying down debt and boosting shareholder returns instead of raising
output.

U.S. oil futures were up about 22% so far in 2024 after dropping by 11% in 2023. U.S. gas futures,
meanwhile, were down about 28% so far in 2024 after plunging by 44% in 2023.
That increase in oil prices should encourage drillers to boost U.S. crude output from a record 12.9
million barrels per day (bpd) in 2023 to 13.2 million bpd in 2024 and 13.6 million bpd in 2025,
according to the latest U.S. Energy Information Administration (EIA) outlook.
But the drop in gas prices will cut U.S. gas output to 103.4 billion cubic feet per day (bcfd) in 2024
from a record 103.8 bcfd in 2023, according to the EIA, as some producers slash spending and
reduce drilling activities.

NewBase Specual Coverage
The Energy world –April 08 -2024
CLEAN ENERGY
Africa's electricity access planners turn to geospatial mapping
Darlain Edeme, Africa Energy Modeller – IEA
New tools to reduce the burden of electricity access planning
Around 600 million people in Africa still lack access to electricity. Despite recent progress,
electrification efforts face new headwinds since the Covid-19 pandemic, with a growing debt crisis,
poor utility financial health, and increased affordability challenges. However, advances in off-grid
solutions, in particular solar- and battery-based technologies, with new business models are filling
a growing gap in access provision by grid extensions.
Based on new IEA data and analysis, in sub-Saharan Africa, off-grid systems accounted for over
half of new connections in 2022. Still, closing the access gap requires greater scaling, which today
is hindered by traditional planning and customer acquisition approaches, which often relies on
workers going village-by-village to assess to the current electrification and energy needs at the
community level.
The International Energy Agency, alongside researchers at Massachusetts Institute of Technology,
University of Massachusetts Amherst, and Electricity Growth and Use In Developing Economies,
developed a model which can address this gap. By mapping which buildings are likely to already
have access to electricity today and which do not, the tool also estimates the current or anticipated
electricity needs for every building in a country.
This open-source model uses satellite images and available footprints of all buildings across Africa,
then pairs that with the utility meter data on electricity consumption matched to the geolocation of
that building or community. The model then uses Artificial Intelligence (AI) algorithms to learn from

high-resolution images of buildings, identifying the patterns that best correlate their image and
location to a certain level of energy demand.
While impossible to ascertain exactly, the algorithms likely pick up on details that signify whether
the building is urban or rural, residential or commercial, and if the community is connected by major
roads to markets which could signify relatively high income and ability to pay. When tested, the
model was able to identify which buildings have electricity today with over 80% accuracy and
provides a 40% error reduction when estimating electricity demand of buildings over the state-of-
the-art tools commonly used today.
This tool can, accordingly, be applied to satellite images of entire countries, and produce a
significantly improved estimate for planners, utilities, and off-grid solar companies to identify target
customers and communities. This significantly reduces the need for extensive on-the-ground
surveys, customer acquisition costs and, if trained on a representative sample of communities, can
adapt its estimates to the local context, cultures, climate, and other factors on a larger scale.
The below schematic gives an overview of the model’s approach and is followed by examples of
the new Open Energy Maps tool, released today by the IEA and MIT, which includes maps in Ghana,
Senegal, and Uganda, with estimates for electricity demand and electrification stats for all identified
buildings in these regions.
Building-level access status and electricity demand estimation model scheme
Identifying unserved buildings and estimating their demand by satellite
Most regions with an electricity access deficit still lack data from utilities on which buildings and
communities are electrified or not. The de facto proxy is utilising nighttime lights from satellite
images as an indicator of electrification, which is a common practice for utilities and off-grid
developers.
While this approach is largely dependent on streetlighting and may miss the increasing number of
houses with small off-grid systems, it remains one of the strongest indicators of whether a

community is electrified or not. Over the years, the dataset has been enhanced, controlling for other
non-electric sources of light like fires and variances over time, such as power outages.
The model builds on the night-time lights methodology, but uses high-resolution images of buildings,
their surroundings, and other geolocated datasets such as internet speeds to give a much more
granular assessment. Right now, the night-time lights approach gives an assessment of access for
each 1 km squared, where the model predicts this at the individual building-level with over 80%
accuracy.
This approach can help identify settlements where the urban core is electrified, but buildings just a
few hundred meters outside of town may remain unelectrified or help identify areas of urban infill
and informal settlements which may remain unconnected or underserved. Many of these buildings
are among the most interesting customers for utilities and off-grid companies to target, as the cost
to reach these customers is low, and their ability to pay may increase faster than other less-
connected regions.
Estimated future electricity demand for unserved buildings, selected location
The model also estimates the likely electricity demand of each building, for both buildings with
electricity access already and those without. This estimate relies on training the model on high-
resolution images of buildings that have been matched with real utility data for that specific building.
Perhaps unsurprisingly, many of the buildings that the model identified as higher users of electricity
were large industrial or commercial footprints or multi-story buildings. Similarly, buildings in denser,
urban areas were correlated with higher-consuming buildings. Interestingly, similar geospatial
models which use satellite images to estimate income per capita in different communities had strong
overlap with the buildings identified by this model as higher users of electricity.

By combining this model with advanced geographic information systems (GIS)-based least-cost
electrification tools, planners can quickly conduct highly precise pre-feasibility studies for grid
extension, mini grids, and standalone systems.
It also helps companies better target communities and buildings that are likely to have a higher
ability to pay, using these communities ideally as anchors for providing additional access to areas
that may face a steeper affordability challenge. Additionally, this kind of dataset can help inform
other portions of project preparation, such as spatial planning for distribution grids, generators and
substations. It can also improve sizing of power systems—especially off-grid solutions— and
facilitate more accurate financial forecasts.
An affordability gap revealed
When applied to electrified areas in pilot countries the model revealed the stark disparities between
actual electricity consumption and expectations. Electricity consumption in many buildings remained
much lower than benchmarks commonly used in the energy space to describe basic levels of
household electricity usage, likely due to challenges with affordability of energy and appliances, but
also complicated by low reliability of power.
Our analysis across Ghana, Senegal, and Uganda revealed that a considerable portion of the
population, despite having access to electricity, consumed less than the IEA’s basic and extended
bundles of energy consumption. This corresponds to the lower tiers of the Multi-Tier Framework for
energy access.
Share of buildings per country per electricity access level, 2022
At the household level, this low consumption suggests that, even where access is available,
electricity may not be affordable or reliable enough to support essential activities such as lighting,
cooking, and powering devices critical for education and home-based businesses.
For off-grid businesses and utilities, this can make households unattractive to connect without
greater incentives from governments or other financing mechanisms like results-based finance.

However, the disparity though between different regions is also stark, indicating the importance of
data catered to reflect the local context, and to update regularly to reflect how changes in tariffs may
substantially change the energy demand for each household.
The IEA and its partners remain available to engage with other countries and utilities to extend these
models to new regions—making a critical public good available to utilities and off-grid developers
alike in hopes of lowering the time and costs required to electrify new communities.
Methodological note
The data presented in this commentary has been collected by the IEA from government agencies,
existing surveys, and partners. Developed in collaboration with Massachusetts Institute of
Technology and University of Massachusetts Amherst and supported by Power Africa, the IEA
introduces an open-source building-level electricity access and demand estimation model.
This tool aids planners in accurately estimating future energy requirements for sub-Saharan
structures. The openly accessible datasets, presently encompassing select countries, comprise
polygon vector files.
This initiative, together with the Africa GIS catalogue for Energy Planning is central to the IEA's
partnerships, aiming to support GIS expertise across the continent through dedicated capacity-
building and cooperative efforts.
It seeks to empower countries with the ability to utilise GIS technology for developing and
implementing customised energy access strategies, tailored to meet national challenges. These
concerted efforts are crucial in refining energy access initiatives and maximising the use of GIS
tools in achieving Sustainable Development Goal 7 (SDG7).
We invite countries interested in this analysis to collaborate towards bridging energy access gaps,
aiming for universal coverage. For collaboration, featuring your model or dataset in the Africa GIS
Catalogue, or model customisation discussions, contact us at gis@iea.org.
References
Partners include Massachusetts Institute of Technology, University of Massachusetts Amherst and Electricity Growth and Use In
Developing Economies (e-GUIDE).

NewBase Energy News 08- April - Issue No. 1714 call on +971504822502, UAE
The Editor:” Khaled Al Awadi” Your partner in Energy Services
NewBase energy news is produced Twice a week and sponsored by Hawk Energy Service – Dubai, UAE.
For additional free subscriptions, please email us.
About: Khaled Malallah Al Awadi,
Energy Consultant
MS & BS Mechanical Engineering (HON), USA
Emarat member since 1990
ASME member since 1995
Hawk Energy member 2010
www.linkedin.com/in/khaled-al-awadi-38b995b
Mobile: +971504822502
khdmohd@hawkenergy.net or khdmohd@hotmail.com
Khaled Al Awadi is a UAE National with over 30 years of experience in the Oil & Gas
sector. Has Mechanical Engineering BSc. & MSc. Degrees from leading U.S.
Universities. Currently working as self leading external Energy consultant for the
GCC area via many leading Energy Services companies. Khaled is the Founder of
the NewBase Energy news articles issues, Khaled is an international consultant,
advisor, ecopreneur and journalist with expertise in Gas & Oil pipeline Networks,
waste management, waste-to-energy, renewable energy, environment protection
and sustainable development. His geographical areas of focus include Middle East,
Africa and Asia. Khaled has successfully accomplished a wide range of projects in
the areas of Gas & Oil with extensive works on Gas Pipeline Network Facilities & gas
compressor stations. Executed projects in the designing & constructing of gas pipelines, gas metering &
regulating stations and in the engineering of gas/oil supply routes.
Has drafted & finalized many contracts/agreements in products sale, transportation, operation &
maintenance agreements. Along with many MOUs & JVs for organizations & governments authorities.
Currently dealing for biomass energy, biogas, waste-to-energy, recycling and waste management. He has
participated in numerous conferences and workshops as chairman, session chair, keynote speaker and
panelist.
Khaled is the Editor-in-Chief of NewBase Energy News and is a professional environmental writer with over
1400 popular articles to his credit. He is proactively engaged in creating mass awareness on renewable
energy, waste management, plant Automation IA and environmental sustainability in different parts of the
world. Khaled has become a reference for many of the Oil & Gas Conferences and for many Energy program
broadcasted internationally, via GCC leading satellite Channels. Khaled can be reached at any time, see
contact details above.

08 April 2024 Energy News issue - 1714 by Khaled Al Awadi_compressed.pdf

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