WEST AFRICA – The West African regional block has received US$300 million from the World Bank for the implementation of energy sector reforms that will promote access to affordable electricity in the region.
The World Bank funds will be particularly used to help Burkina Faso, Côte d’Ivoire, Guinea, Liberia, Mali, and Sierra Leone implement sector reforms aimed at achieving the potential of the regional power market.
The new operation supports a regional energy reform program set out in three pillars.
The first aims to increase confidence in the enforcement of commercial arrangements by supporting payments and enforcement mechanisms relating to energy trade.
The second supports the implementation of least cost investment decisions that consider regional options and that promote competition.
The third supports transparency, by addressing creditworthiness of national power utilities and keeping the market informed on key investment decisions that impact demand and supply.
According to a report by Africa Energy Portal removal of boundaries will lower electricity costs for consumers, support the competitiveness of firms and improve resilience and reliability of supply.
The World Bank noted that currently, only 50 percent of the population in West Africa have access to electricity which at its best is plagued with operational deficiencies with an average of 44 hours of outages per month.
The West Africa Energy DPF thus supports a policy reform program being implemented by Burkina Faso, Côte d’Ivoire, Guinea, Liberia, Mali and Sierra Leone, to facilitate trade in cleaner low-cost electricity generated from gas, hydropower and renewable energy across borders.
It allows the World Bank to support reforms in order to reach a common objective across several countries in a coordinated manner.
It also represents a watershed on the regional integration agenda in West Africa which is aimed at creating a regional power market.
Across the ECOWAS region, the economic benefits of the regional power market are evaluated at $665 million per year with a reduction of one third in the average cost of electricity generation in the region.