5 June 2014

Africa: U.S. - Africa Energy Ministerial Press Conference

Photo: Chris Kirchhoff
Beaufort West, Western Cape province: Electricity pylons.

press conference

Johannesburg — MODERATOR: I am Katherine Diop and I am the press officer here at the U.S. Embassy in Addis Ababa. Thank you for coming this afternoon to our on-the-record press conference on the U.S.-Africa Energy Ministerial. It is an honor for me to introduce to you today His Excellency Dr. Ernest J. Moniz, the United States Secretary of Energy as well as His Excellency Minister Alemayehu Tegenu, the Minister of Water and Energy for the Federal Democratic Republic of Ethiopia. We also have with us today, Ambassador Girma Biru as well from the Federal Democratic Republic of Ethiopia. I would like now turn it over to His Excellency Minister Alemayehu for a few remarks.

H.E. MINISTER ALEMAYEHU: Thank you very much, Madam. We are very delighted for hosting this very important conference with the State Secretary of America. This conference is very very important for the continent, by hosting this conference at the government of Ethiopia we can say that we are highly benefited. I would like to thank the Secretary for America and his staff for cohosting and choosing to have us here for this conference. Thank you very very much. I have very high appreciation for your staff and for you. As maybe most of you participated in this conference, the two-days conference was very successful. We have discussed a lot of issues regarded to energy, the private participation, energy issues with relation to [inaudible] participation. The new approach for the electrification - that is mini grid approach. We also discussed about energy efficiency which is very important for Africa. Most of our systems are full of losses, using energy efficient systems in the continent is very very important and we have also assessed and explored how to continue working with Obama with the Power Initiative with the State Secretary and I can say the objective of our conference is fully completed and successfully. Thank you.

MODERATOR: And now we will turn it over to Secretary Moniz for a few remarks.

H.E. DR. ERNEST J. MONIZ: Well thank you Mr. Alemayehu and I certainly want to echo your comments about the pleasures of us working together.

We were very very pleased that you were willing to taking on this big task of hosting the meeting, and I know from our side, the collaboration was just excellent and we should note, I mean we had many many ministers here, we had many private companies here, so it was a major effort and we appreciate it. With regard to the meeting itself, we have a little bit more to go, but up til now as the Minister said, I think it has been extraordinarily successful. Frankly, starting right out with the presentation by the Prime Minister, the Prime Minister's emphasis on the risks in Africa from climate change were very very well spoken, and of course, we came here to discuss energy development, energy infrastructure development, energy development in Africa as a critical enabler for economic development and specifically for the development of diversified economies in Africa and in having that focus here on the tremendous resources in Africa, renewable resources, natural gas being developed strongly, of course oil as well, but the agenda aligned very very well with the energy agenda because of the wealth of clean energy sources in Africa here to be developed. The second major theme was the importance of localizing private capital.

There were a variety of estimates of the kinds of investments needed for developing African infrastructure, for example, three hundred billion dollars let's say in the power sector alone. We in the governments can help facilitate this and contribute obviously, but in the end resources of this scale will require the private sector and that is why we had such a strong connection, strong emphasis here I should say, on having the companies involved and having very good discussions about creating the conditions to attract large investments, especially when we recognize that there is a lot of competition for capital in the world, but capturing the moment here, a very dynamic time in Africa, we think is really really important. And third, and finally, and the Minister noted this - well maybe not third and final - for the emphasis that I found here in discussions in the meeting, but also with individual countries and ministers on the importance and opportunities for regional solutions, which I found extremely interesting, and that was both in the electricity assistance, but also things like natural gas infrastructure as it might be used to help develop a variety of regional economies. The fourth thing I will just say and this will be the last, before your questions, is the - and the Minister again mentioned things like mini grids as our focus here, but I was able to announce yesterday that President Obama's Power Africa initiative will now take on an additional emphasis on serving Beyond The Grid - serving the rural areas, as we know, Africa today has many many people without services of electricity and mini grids and distributed resources, including renewables, look to be a very important solution and I think we will be working hard in terms of finding the business models that can also attract private capital in this area, working of course with the African governments. We know the solutions are not one size fits all, the challenges, the needs, the opportunities across Africa are very very different in different parts of the continent and looking here, of course in North Africa, Sub-Saharan Africa and so we will be working with countries, with regions as we find the kinds of solutions that we just discussed. So, thank you.

MODERATOR: Thank you. We will now proceed to the question and answer portion. Please state your media organization for the record when calling, and please direct your questions to either Secretary Moniz or Minister Alemayehu. And again, just a reminder, to please only limit yourself to one question at a time. First question please.

MEDIA: Thank you. I am Will from Bloomberg News. This is a question for Secretary Moniz. You mentioned the emphasis on regional solutions and projects at the conference and basically everyone agrees on embarking on regional projects [inaudible] Is that a project the U.S. supports and are the arms of the U.S. government going to lend the technical assistance for that project?

H.E. DR. ERNEST J. MONIZ: Well, we understand the importance of that project in terms of potentially a massive amount of electricity, I believe it is six and a half thousand megawatts, is the target for serving Ethiopia and in fact some neighbors as well with electricity. Of course, we also recognize the Egyptian concerns about water and we understand there are excellent discussions going on and we certainly support having those questions resolved. I think the satisfaction of all the countries in the region. As far as technical support, we have, across the board, through our laboratories, through our agencies like the Trade and Development Agency are happy to continue to provide technical support for all of these energy initiatives. And, for example, I'll just mention here in Ethiopia, the case where that is happening is in the Power Africa program is the geothermal project that is well underway, with I believe drilling starting in July - I am told.

MEDIA: I am from Ethiopian News Agency. My question is for Dr. Moniz, Secretary. How do the [inaudible]expect the competency on the regional power [inaudible]?

H.E. DR. ERNEST J. MONIZ: I am sorry, in terms of competency? In the power [inaudible]?

MEDIA: Yea, in the power [inaudible] H.E. DR. ERNEST J. MONIZ: Well as far as I can see, we haven't had any discussions about that at this meeting, but I believe and I am going to turn to the minister actually, to add comments to that, I believe the project is being well planned and moving forward, but maybe Mr.

Alemayehu, you can elaborate on that.

H.E. MINISTER ALEMAYEHU: Thank you very much. Contribution to Africa and the power pull is very high. Currently, we have 80,444 megawatts construction of hydropowered development is undergoing. This is not only for [inaudible]consumption, it is also for regional power interconnections and we have for now the construction of transmission [inaudible]which have capacities of 2,000 megawatt each one to keep our transmission alive [inaudible]This will enable some African countries like Rwanda, Uganda and Tanzania to supply them with this very reliable and affordable hydropower supply so the competency is very high for the power pull.

MODERATOR: Next question MEDIA: Thank you very much. My name is [inaudible]and I am from [inaudible].My question is for Mr. Ernest. Yesterday was the announcement of the commencement of Beyond The Grid program which is part of Power Africa Initiative. I want to hear from you what this program means for Ethiopia, and how it will help Ethiopia to achieve becoming a power hub in East Africa. And for Mr. Minister Alemayehu, if this power to be generated under this program is off the grid, how would be its arrangement? Thank you very much.

H.E. DR. ERNEST J. MONIZ: Well again, the Beyond The Grid approach, I can't say any more. Well, again, it will be a sub-initiative if you like, of Power Africa approach. As I said, it will be focusing on mini grids. I think it seems that we will be looking especially at some countries with higher rates of unserved people to have some initial focus. We will be working with all of the six countries, and I should emphasize, with the Power Africa, currently we have the six countries where we focus not only on projects, but also the issue of planning, systems analysis and support, but I do want to emphasize the same mechanisms, whether it is the Ex-Im Bank, or the Trade And Development Agency, we are working also on electrification on grid and off grid throughout Africa, so it is not only for the six countries.

H.E. MINISTER ALEMAYEHU: The issue is a management issue that is not a problem for the Beyond The Grid electricity facilities. Actually, the design for this current Beyond The Grid facilities and there is that grid will accommodate 4 or 6 things. Number one is lighting, number two is for [UNCLEAR] station, number two for school, number three is for water supply, number four is for small micro enterprises, number is five is for [inaudible]. This Beyond the Grid is designed in such a way. To manage this grid, the management will be localized and it will be managed by the community itself. Most of our population is very scattered. Unless it is otherwise, if we don't implement Beyond The Grid solution of a localized solution it is very difficult to access the whole population with modern energy so it is very important if we follow the design, the management will not be an issue.

MODERATOR: Next question. Right here sir, please.

[Question inaudible] H.E. DR. ERNEST J. MONIZ: Well first of all, I think the United States has been involved in infrastructure development in Africa and I am thinking in particular, of course, many of our companies have been involved in the gas sector, in the power sector in various countries.

Now last year, of course, the President then launched Power Africa and this has very much elevated our interactions with the governments, but again with the idea that working with the government we are trying to mobilize, again, the private capital and to develop the infrastructure dramatically. Now, we are also - beyond Power Africa, it depends very much on the country and the resource. As a different example, if we go to North Africa, there are - there appear to be, for example, dramatic cell resources, for cell gas for example. Where almost all the experience in the world right now has been in the United States and we are happy to share that technical information including how to manage the environmental challenges. So I think that the President has made it very clear that we see this as important and mutually beneficial and we are here, and we have learned a lot already in this meeting about how we can do everything from technical assistance to getting major projects executed with a combination of public and private funds.

MODERATOR: Next question, right here.

MEDIA: My name is [inaudible] from the [inaudible] News Agency. My question is for the Secretary. I know the countries on the power project, the power [inaudible] with the Obama plan have been taking over going nuclear [inaudible] electricity for the [inaudible]. Would you advise them to continue on that path? Or, would you advise them to look at another way, other than nuclear?

H.E. DR. ERNEST J. MONIZ: First of all, I would say that, in the meeting here, most of the focus has been on, I would say - natural gas and renewables and efficiency. We have had a couple of discussions with countries on nuclear power and right now, the discussion is much more along the lines, of how does one build the kind of infrastructure, including moving capacity for a nuclear program. Of course, we are again, we have the largest nuclear fleet in the world and we are again happy to assist with countries in that direction. However, I might say, and I had this discussion here as well, a new development in nuclear power might be something that is very attractive for Africa if it materializes in a cost effective way. Now we are very optimistic as called small modular reactors and the Department of Energy, we are now providing financial assistance for future projects. The idea here is that rather than build nuclear reactors that are a thousand megawatts or a thousand four hundred megawatts, which have to be constructed on site, we have had many challenges. Europe has had many challenges with that.

These reactors would be much smaller, typically in the fifty to two hundred megawatt range. They have excellent safety features. They might be underground in fact, and they would be built in a factory and just delivered to the site, and in factory, one has the potential for better quality control, for reducing costs in manufacturing and we expect to have the first of these deployed early in the next decade. So, 2022, 2023. And, if those prove to be cost effective, that might be a very attractive nuclear option in Africa, but we're a decade away from having those questions resolved.

MODERATOR: We have time for two more questions.

[Question inaudible] H.E. DR. ERNEST J. MONIZ: Okay, the first one, it Babcock and Wilcox design. It is being patrolled in partnership with the TVA for deployment in Tennessee and the funding is that we are, the Department of Energy is supplying some significant funds for taking the project through the licensing stage and then it would be presumably at the stage - our assumption is that it would be built as a commercial project. The second project we just have announced. The signing of the contract with a smaller company called [inaudible] and that is a company that is based in Oregon and the same arrangements in terms of sharing through licensing of that project. It's a smaller. It's a roughly fifty megawatt reactor.

[Question inaudible] H.E. DR. ERNEST J. MONIZ: No one is looking right now for a buyer. Well the first thing is to get the design to be licensed and to build - practically speaking, I think, we need to build the first one. What is the case, is true, that there is tremendous international interest in this and obviously, because it has so many attractions potentially, in terms of its adherent safety feature, to both being able to manufacture and deliver the whole core module, it has been very attractive. It will also reduce dramatically schedule for the onsite activities.

MODERATOR: And our final question for the conference. Do we have any takers? Yes, Sir.

MEDIA: I am from [inaudible]. My question is for Minister Alemayehu on Egypt. What did he say? [Question inaudible] H.E. MINISTER ALEMAYEHU: What we have discussed are bilateral issues regarded to energy.

[Group Laughter] MODERATOR: Thank you everyone for your time and our thanks to our principals for participating.

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