Inside Africa blog

Legal developments around Africa

Inter-regional grid infrastructure development in Africa on the rise

Katrijn Thys

The lack of formal grid infrastructure across the African continent has created an opportunity for energy companies to develop off-grid and mini-grid solutions, which can assist in bringing power to rural and isolated communities.  These solutions alone are not sufficient however and African governments need to focus on upgrading formal grid infrastructure to ensure every African has access to electricity. 

Africa is in desperate need of electricity to unlock the economic potential of its various countries.  Power is the enabler but African countries are struggling to generate and transmit electricity to meet the ever growing demands. 

Leaders of a number of African countries have identified the benefits that inter-regional transmission lines and grid infrastructure can provide.  The Programme for Infrastructure Development in Africa (PIDA) was adopted in 2012 and its purpose is to provide the framework for identifying key cross-border power corridors required to address the African energy deficit.  The African Development Bank (AfDB) Group is a key stakeholder in PIDA and is responsible for the contractual, financial, technical and administrative management of the programme.  A similar initiative is the creation of the International Renewable Energy Agency (a complimentary intergovernmental organisation that supports the transition in African countries to a sustainable energy future). 

Inter-regional African initiatives, such as PIDA, are not a new concept, as seen through the creation of the Southern African Power Pool, Eastern African Power Pool and Western African Power Pool and recent events have indicated that the focus on achieving real cross-border sharing of grid infrastructure has been invigorated by these initiatives.  Projects that are in the pipeline and that are being actively pursued by PIDA and the various power pools  include the development of power corridors between South Africa, Mozambique and Zimbabwe; South Africa and Botswana; Ethiopia and Kenya; Kenya and Uganda; and Kenya and Tanzania.  These projects should allow African countries to achieve economies of scale by sharing in the costs involved in developing grid infrastructure.  This in turn could assist in ensuring tariffs remain affordable for citizens yet sufficient to meet debt service requirements.  Active involvement by African governments in inter-regional infrastructure should encourage investors and assist in alleviating concerns typically associated with investing in infrastructure in Africa. 

While the promise is there, most of these projects are in the feasibility or negotiation stage with key stakeholders so a proper evaluation of whether inter-regional infrastructure development will be the saviour that is needed to unlock access to electricity across African economies will only come in time.

About

Africa is as dynamic a market as it is diverse. We understand that changes impacting your business can arise rapidly and vary significantly across the continent.

Our understanding of Africa’s markets stems from extensive experience on the ground. Through our Inside Africa blog, we aim to apply this insight to provide you with timely commentary on the latest developments across Africa, as well as insight into the many nations that make up this vast continent.

Read more
Blog Network

Topics

Archives