Strengthening Public-Private partnership in West Africa power sector
Electricity across the globe has become an indispensable prerequisite for enhancing economic activity and improving human quality of life. West African countries like Ghana, Nigeria, Senegal and Cote D’Ivoire could enhance industrial production processes with efficient supply.
As forward looking as this prospects is, the West Africa region continues to struggle with access to electricity. The region constantly grapples with electricity blackouts on a daily basis. Faced with this situation, people and enterprises often have to rely on expensive diesel power generation to meet their electricity needs.
In view of the glaring electricity challenges, industry experts have opined that to meet its growing demand, West African countries have an urgent need to raise the level of investment in its power sector.
Industry watchers suggest the region will need to add an estimated 150 GW of capacity between now and 2030 to meet demand growth.
According to them, the magnitude of the investments required is such that governments will need public-private partnerships in order to scale up investment in generation capacity.
They further observed that while access rates are improving in some countries, the business environment and policy framework are still not sufficiently robust to attract the level of private investment required to install the additional 150 GW by 2030.
According to them, “Some West African countries are burdened by unclear policy frameworks and excessive bureaucratic bottlenecks as electricity subsidies and government mandated pricing often hinder sustainable business investment”.
Analysts said that the policy framework, manufacturing base, social issues related to energy need to be considered as well.
To them, West Africa faces a unique opportunity as nearly two-thirds of the additional capacity needed in 2030 has yet to be built, adding that the region can benefit from the recent global progress and cost reductions in renewable power generation technologies, to leapfrog the development path taken by industrialised countries and move directly to a renewable-based system.
According to a report by the International Renewable Energy Agency, the economic potential of hydropower is much smaller than the technical potential, but is still enough to allow hydropower to provide a significant share of total African power demand.
The dam-based hydro power potential will, through its electricity storage potential, also play a vital role in facilitating the growth in other variable renewables such as wind and solar. In addition, pumped hydro could
International Finance Corporation (IFC), the private sector arm of the World Bank, has formed a partnership with HPS and is looking to expand into Nigeria. IFC will provide an investment grant of up to 29 percent of the capital cost for biogas power generation projects, with the balance to be met by commercial loans.
GIZ (Germany) is also focusing on the promotion of biomass gasification for combined heat and power (CHP) generation in decentralised settings as an economic alternative to grid extension in remote areas of Benin.
The potential is large, with 766 MW of capacity possible from agricultural waste in Benin alone. GIZ plans to install one or two small pilot units of between 25 kW and 100 kW in a low-voltage mini grid to gain experience.
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