Newsletter: When lack of power turns deadly

In the U.S. and abroad, substandard grid infrastructure can be a life-and-death matter.

(Amos Gumulira/AFP via Getty Images)
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I’ve got local and reliable power on my mind.

You can’t not think about it after reading this somber New York Times account of how Hurricane Ida’s destruction in New Orleans proved to be less deadly than the subsequent combination of heat and power outage in the storm’s wake.

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The reporters take you into homes where elderly residents survived the storm itself, but then sat in their stagnant rooms, without air conditioning, as temperatures surpassed 90 degrees for days on end. That heat claimed 10 of the 14 lives lost in the city from the storm and its aftermath.

It’s a tragic reminder that the effort to build a better grid isn’t just for futurists and climate hawks. It’s a life-and-death matter right now. That’s true where the grid fails, and also where the grid doesn’t even exist. 

A new series from Canary Media explores the latter area, namely the 800 million people around the world who lack access to any sort of electrical grid. 

  • Building out the traditional centralized grid is quite expensive, and in many countries the conventional grid remains unreliable. 

  • More than 11 million people have turned instead to minigrids,” basically a small microgrid in a rural community.

The plunging costs of solar panels and batteries led the World Bank to conclude that minigrids could cost-effectively lift half a billion people out of energy poverty. Contributor William Brent breaks down the obstacles to delivering that outcome:

The minigrid industry is nowhere near being on track to deliver that type of growth, and it still faces numerous regulatory, financing and business-model challenges to getting there. 

Finding the right kind of finance is key. Minigrids cost money to build but earn revenue over the years as people use their electrical output. But affordable long-term debt is hard to find for this emerging type of project.

Well-designed and well-managed minigrids are moneymaking propositions, particularly when compared to the cost of extending centralized grid service to remote communities. But the relative novelty of categorizing the minigrid opportunity as a central part of future energy systems, rather than a marginal solution, has been a barrier to expanding the field of willing commercial lenders, as has the uncertainty of the risks involved.

Then there are issues like exchange-rate volatility, which is a problem if minigrids get loans in one currency and earn revenue in a local currency.

Perhaps more daunting is the permitting process for minigrids, which in many places is just as rigorous as it would be for a fossil-fueled plant orders of magnitude larger. 

For all the hurdles, the fundamental costs are trending in the right direction. When the market can supply a better product that’s cheaper than the incumbent, people tend to figure out how to push aside the obstacles.

Julian Spector is an editor at Canary Media and reports on the rise of clean energy. He worked at Greentech Media for nearly five years, and before that he reported for CityLab at The Atlantic.