A huge opportunity for the UKThe lack of electricity in India and Africa:

Call to action

• This presentation is a call to action if the UK is to create growth in the energy sector.

• India and Sub-Saharan Africa represent a massive export growth opportunity.

• There is a need not just for access to electricity, but resilient electricity supplies, which will drive growth for many years.

• The UK has natural advantages over other countriesbut we must exploit them now.

Contents

• A look in the mirror – how is the UK doing?• The opportunity in numbers• Why we should succeed

(and be ashamed if others succeeded instead)

• What directed, strategic support might look like

A look in the mirror

Sweden chose to use a connection between itsmainland and its largest island of Gotland as a test-bed for High Voltage DirectCurrent (HVDC) transmission. This made sense in a region in which most its futurecross-border energy flows would be via submarine cables. ABB established theworld’s first link to the island of Gotland in 1954, and have gone on to deliver morethan half of the world’s HVDC projects since.

France took a decision not only to rely on nuclear power for a significant proportion of its energy generation, but also to develop an export market for nuclear technology. It has creatednational champions Areva and Energie de France (EDF) and is well positioned to capitalise on the next round of new-build nuclear.

Denmark had historically high fossil fuel emissions, and abundant wind resource. The country took a strategic decision to pursue wind generation. This led to the establishment of wind turbine manufacturer Vestas, rated by three out of four external analysts as the leader by market share.

We talk about wanting to create “green collar” jobs…

…but doesn’t it feel like others are running a different, more strategic, race?

What would happen if government got “back in the game”?

• UK government would look for opportunities to create growth for a sustained period of time.

• It would look for opportunities in which the leadership position was still there to be grabbed.

• It would look for opportunities which exploited our historic advantages.

• India and Sub-Saharan Africa represent just such an opportunity, which is in its infancy.

India and Sub-Saharan Africa will go through a sustained period of infrastructure build and increasing customer expectations

905 million of them live in Sub-Saharan Africa and India.

1.258 billion people are without electricity.

Another one billion people suffer from unreliable power supplies characterised by unplanned power outages, massive losses and low power quality.

Whilst electrification rates in cities are higher, neither India nor the most developed parts of Africa have been through the cycle of increasing

customer expectation in which resilience is essential and “brown-outs” caused by the grid or by power plants become unacceptable. This will

create a huge demand for technology.

It’s not about selling existing products to a new market – we need to get creative

We have the knowledge to design intelligent systems that can re-assemble an "as built" configuration of the network and do not assume that there have been strict controls in the past. They assume that there are likely to be significant pockets of "hidden" but energised utility assets.There is a significant market for distribution

substations and associated protection designed for local conditions such as air conditioning load, and significant penetrations of local Uninterruptible Power Supplies (UPS) or diesel back-up generation. These need to be very strictly value engineered, but at the same time suited to a future more resilient, more automated grid.

Lack of transport infrastructure may encourage more build on-site and more local assembly. UK companies may be able to distinguish themselves by looking at radical levels of local assembly such as transformer assembly on site, or by simplifying and de-skilling transmission line construction.

So why should the UK succeed?

12 nations generate most of Africa’s wealth. 7 of them are English-speaking. So is India.

Reason #1 – we know the language

KPMG highlighted 9 countries for growth in the power sector - 7 are English-speaking.

Simply put, we should be ashamed if we’re being beaten to technical sales, system integration and after-sales support opportunities by competitors working in a

foreign language.

There is a legacy of UK design standards. It’s a bit like driving on the left.

Reason #2: The networks look like ours

This is exportable expertise.

Reason 3: We have an outstanding health and safety culture

There is a political consensus around foreign aid and building business

links with India.

Reason 4:

There are Indian and African ex-patriates working in UK industry and universities – ready-made ambassadors for our technology.

Reason 5:

What would strategic, directed support from government look

like?

Firstly, great things are happening…• For example, Siemens have based their

Global Cites Centre of Competence in the UK.

• S&C Electric have based their Middle East and Africa operations in Wales.

• We are competitive in distribution switchgear on the parts of the network closest to the customer.

• We have huge success stories in technologies for supply resilience at 415V/240V.

• We have demonstrated an exceptional ability to integrate renewables onto the grid.

… but we could achieve so much more

Government can support by:• Casting the vision through trade missions• Curating a knowledge base of procurement

experience, and industry expertise• Being ambitious with bilateral country-to-

country approaches• Providing financial back-stops to reduce

commercial risk and increase confidence• Provide targeted R&D support to kick-start

“Made in the UK” product developments.

Conclusions• The lack of electricity in India and Sub-

Saharan Africa present a massive export opportunity.

• Whilst industry must grasp the opportunity, government can certainly help.

• The UK has natural advantages over other countries but we must exploit them now.

How to join the debate

Martin Wilcox, PhD CengInmail https://uk.linkedin.com/in/wilcoxmarti

nEmail martinwilcox@btinternet.comJoin the debate https://www.linkedin.com/groups/8496

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ReferencesVestas credentials: As quoted in their presentation accompanying Q1 2015 interim financial resultsABB credentials: Bernhard Jucker and Claudio Facchin, ABB Capital Markets Day, London, Sept. 9th, 2014People with access to electricity: All figures from ‘Remote Access’, A. Zomers, IEEE Power and Energy Magazine, Vol. 12, Nr. 4, July/August 2014, and sourced from the International Energy Agency (IEA)“KMPG recently highlighted”: “Sub-Saharan Africa Power Outlook 2014”, KPMG, http://www.kpmg.co.za Accident rates: From “Powering Improvement Corporate Memory”, Energy Networks Association, http://www.poweringimprovement.org Picture creditsCover - ©Mvorobiev | Dreamstime.com http://www.dreamstime.com/mvorobiev_infoGreen collar jobs – ©Michael Flippo | Dreamstime.com http://www.dreamstime.com/miflippo_infoThe race – ©Natursports | Dreamstime.com http://www.dreamstime.com/natursports_infoPost-it notes - ©Elnur | Dreamstime.com http://www.dreamstime.com/elnur_info Apartment block - ©Vilant | Dreamstime.com http://www.dreamstime.com/vilant_info Overhead line tower - ©Gokhan Okur | Dreamstime.com http://www.dreamstime.com/gokoroko_info Driving on the left - ©Johannes Hansen | Dreamstime.com http://www.dreamstime.com/jojoo64_info African rural scene - ©Courtney Radsch https://www.flickr.com/photos/30762903@N06/ All maps and infographics – Infogr.am http://www.infogr.am