Exclusive interview with Marius Oosthuizen, Lecturer: Strategic Foresight (Leadership, Strategy & Ethics), Gordon Institute of Business Science (GIBS), South Africa.
At the upcoming African Utility Week he will launch a Scenario Report based on a study specifically commissioned for the event. In what is expected to be an impactful session, the report is looking at the future of the power industry and Africa’s geopolitics, assisting energy leaders to predict the sector’s future and make effective decisions.
“Through strategic foresight, scenario planning and trend analysis, the GIBS Future Project develops insight into the changing dynamics of markets, political economies, technology.”
Can we start with some background on the work that you do at GIBS?
The GIBS Future of Business Project develops thought leadership to assist businesses operating in South Africa, Africa and BRICS, to remain competitive and effective in an ever-changing world. Through strategic foresight, scenario planning and trend analysis, the GIBS Future Project develops insight into the changing dynamics of markets, political economies, technology. These strategic insights shed light on how to respond to future change.
Any specific projects in the energy and infrastructure sector?
The Scenarios on the Future of Energy Security in SA and SADC were undertaken to give policy makers and executives in the region a perspective on the regulatory, operational and technological changes that will disrupt or constrain the sector in coming years. Through the scenario planning process, we were able to make key recommendations about the need to realign the sector to new opportunities in renewables, build greater institutional capacity and develop partnerships with the private sector to take advantage of these opportunities.
You are preparing a sectorial scenario whitepaper specifically tailored to what the audience at African Utility Week would be interested in. What will be study and survey entail?
The study will highlight the most pressing strategic issues facing the sector. These will range from changes in the external environment, politically and economic. It will also highlight changes in the cultural and social realities of the markets in which African utilities operate. The audience and recipients of the report will benefit from the insights and be able to apply them in the context of their own company’s strategic and policy decisions in the coming decade.
You were part of African Utility Week’s final keynote session last year – can you give us a recap of your message then, how did the audience respond?
The audience was given an overview of the factors and trends shaping energy in the SADC region. This covered policy incoherence, fiscal and resource constraints, misalignment between policy makers and the private sector actors in the sector, and the emergence of cost-effective renewable energy alternatives.
The audience were given an opportunity to express their views of the relevance, possible impact and outcomes of these trends. They were highly engaged and supported the view that a re-think is needed in how the public sector engages the private sector in terms of collaboration for the sector’s future.
How important is the imminent signing of the IPP agreements by the government?
The IPPs are crucial to the future sustainability of the sector and to the broader agenda of job-creation in the sector. The history of bulk energy production and distribution through coal-fired power plans, centralised grids and public sector monopolies, is quickly coming under threat from new models of energy production and distribution.
The IPPs are a strategic and systemic intervention that will reposition the energy players in SA for greater sustainability, both in terms of the environment and the overall viability of the sector. In addition, the IPPs, if harnessed, can unlock tremendous value to consumers and alternative distribution and value chains. These will be much more inclusive than the old coal-based business models and can create tech-based energy jobs of the future.
What in your view are the main current challenges that utilities face in planning for the future?
Organisational renewal will be a key challenge – the capacity of executives to lead their organisation through the changes needed to remain relevant and effective in the face of Industry 4.0, technologies such as smart grids and the democratisation of energy. How the public sector facilitates these developments with supportive policy and regulation, and if they public sector can change their posture from a monopoly player to a catalyst for investment and diversification, will be a core challenge.
Anything you would like to add?
With 75% of Africans in central Africa still living in energy poverty, and the population on the continent estimated to grow from 1 billion to 2.5 billion by 2050, energy provision and the related infrastructure development and institutional capacity, will be a key enabler of Africa’s prosperity in the coming century.
Utility companies have a role to play, not only in technically enabling this environment on the continent, but in building the platform on which the modern, post-industrial development of the African market will take place. This will be the platform upon which the basic human rights, and a prosperous livelihood for billions of African citizens will depend.