The cracks in Cameroon’s health system

Abuja Declaration: a bridge too far

Pressure from the coronavirus is  exacerbating old weaknesses in healthcare delivery in public health institutions, leaving mental patients compromised

Jamot Hospital in Yaounde, Cameroon Photo: Amindah Blaise Atabong

In 2001, African heads of state and government signed the Abuja Declaration, pledging to allocate at least 15% of their annual budgets to the improvement of their health systems. This historic commitment was undertaken to make available resources to respond to health challenges, especially HIV/AIDS, tuberculosis and other related infectious diseases. It was aimed at getting the continent’s health systems prepared for outbreaks such as the coronavirus. Some policy experts have found the Abuja Declaration wanting, and have instead pushed for a per capita model of funding. But even at that, close to two decades after the Abuja Declaration, nothing seems to have changed in many African countries; their health systems remain poor and fragile.

Cameroon is one of those countries which are yet to meet the funding target. A 2016 World Health Organization report titled ‘Public Financing for Health in Africa: from Abuja to the SDGs (sustainable development goals)’ shows that Cameroon’s health spending was 4% of the national budget, far below the continental average of 10%, in 2014. Cameroon’s health system had perennial cracks even before the outbreak of the coronavirus. It wasn’t tailored to handle a pandemic of such complexity and severity. Prior to the outbreak of COVID-19, the citizenry in Cameroon had difficulties in accessing healthcare services. Between 2016 and 2018, 27% of the population went without medical care many times, while a further 38% didn’t get medical care even once, according to Afrobarometer in 2020. Close to 50% of the population which had contact with a public health facility had difficulties obtaining the care they needed.

The study also shows that the country’s health system is characterised by long waits to obtain services, lack of nearby facilities and the payment of bribes. Cameroon doesn’t feature on the list of African countries that provide free and universal healthcare. Instead, the country’s public resources allocated to healthcare have continuously been among the lowest on the continent in terms of GDP. A World Bank study found that of the $61 per Cameroonian spent on healthcare in 2010, the government contributed only $17, that is, 28% – of which $8 was provided by international donors. By implication, Cameroonians largely pay for their own healthcare. The COVID-19 pandemic has greatly affected an already pressurised and weak healthcare sector, according to Dr Kibu Odette, senior health policy analyst at the Nkafu Policy Institute, an independent think tank at the Denis and Lenora Foretia Foundation.

Odette told Africa in Fact the country has far less than the number of physicians recommended by the World Health Organization (WHO), with just 1.1 doctors per 100,000 of the population. “It had less than 500 critical beds. Very few ventilators are available to take care of COVID-19 patients. These, among other factors, have greatly affected the way patients are managed. As such, curbing the pandemic has been a challenge to Cameroon,” Odette said. To flatten the curve of the contagion, the government has ramped up its efforts to mobilise resources for the response. Besides initiating a national solidarity fund and seeking debt relief, it has sought loans from the IMF, AfDB and other financing partners – all directed at COVID-19. In so doing, however, other health challenges in regular times such as mental disorders and HIV/ AIDS have been neglected by acts of either omission or commission.

Mental health is an issue in Cameroon, both unrelated to the pandemic and caused by Covid-19. According to WHO, neuropsychiatric disorders are estimated to contribute to 6.1% of the total disease burden in the country. Yet, Cameroon has no mental health policy in place and a simplified guide on the handling of mental cases was only introduced in 2017. Mental health is only mentioned in the general health policy. People who suffer from mental health problems in Cameroon are usually looked at with scorn. Mental health problems are not culturally acknowledged, and people are sceptical of scientific explanations. So, many do not regard it as an illness but some sort of curse, witchcraft, or sign of ill omen and that the patient should be avoided. At policy level, there are only two tertiary public hospitals in the country – Jamot Hospital Yaounde and Laquintinie Hospital Douala – that handle mental health problems.

Kidney patients stage a protest outside the Yaounde University Teaching Hospital, Cameroon, August 2020
Photo: Amindah Blaise Atabong

But these facilities lack adequate qualified personnel and resources. A visit to Jamot Hospital in Yaounde on 18 August 2020 confirmed an existing reality – a gap in the provision of mental healthcare. Officials at the facility declined to comment. However, a caretaker of one of the patients, who gave her name as Mama Christabel, said things had turned upside down since the onset of the pandemic. “It has been a difficult moment for us with patients here. All attention has been shifted to COVID-19,” she said. Jean Pierre, a mental health patient, told Africa in Fact that with the COVID-19 situation, they have encountered problems while attempting to meet their respective doctors. “It is not easy at all. A few patients with whom I was following up treatment have died and I think it is because of fear. So much attention is on the pandemic and it makes it scary.” The government has not been keen to address mental health issues resulting from the pandemic.

It managed to put a mental health call line – 1511 – in place, but it has not been effective, according to Agbor Matelot, a Yaounde-based psycho-social counsellor. “The practice of counselling is not rooted in the culture of Cameroon,” he said. Matelot and other volunteers are running their own COVID-19 mental health call centre as the government response falters. “Through our We-Connect project, people have been able to reach us for assistance. We have handled hundreds of cases related to COVID-19 and the ongoing armed conflict in the Anglophone regions,” Matelot told Africa in Fact . In the past few months, Matelot has stepped up to fill the gap, offering individual and group counselling services in schools and organisations, amongst others.

COVID-19 disruption to essential health services has also been evident. Egbe Maggie-Lowells Ebot, a counsellor at the Presbyterian Hospital Kumba told Africa in Fact that some HIV/AIDS patients were cut off from essential antiretrovirals. “Restriction on movement has made it difficult for patients from remote areas to reach health facilities. And the government didn’t take this into account. Also, patients were scared of visiting health facilities, unsure of whether they will be forcefully tested and quarantined,” Ebot said. A government instruction to observe physical distancing during the pandemic also affected service delivery. Waiting times became even longer as health workers received one patient at a time. “Some got frustrated and left,” Ebot said. Moreover, from the onset of COVID-19, the government made the wearing of face masks in public mandatory. But at the time, face masks were scarce and unaffordable for many.

Those who couldn’t get a face mask were turned away from hospitals. As the government battles to contain the coronavirus, patients with kidney problems have accused it of indifference to their plight, claiming the “government is intentionally killing us”. On 14 August 2020, tens of kidney patients staged a public protest in the capital, Yaounde, in front of the Yaounde University Teaching Hospital. The leader of the patients, Apua Simon, told reporters that most of the dialysis machines had broken down and no efforts had been made to repair them, while dialysis kits were unavailable. “In the beginning, we had 12 machines that were functional and four years later, we are left with just three machines. Every passing day, patients keep on registering and we are over 100 patients now at CHU with just three machines,” he said.

With only three machines in good condition, running 24/7, Apua said they were often given appointments at odd hours like 2am and the cost per dialysis session remained high at FCFA 5,000 (about $9). All these lapses point to the fact that the government doesn’t see healthcare as a strategic priority. Also, as Odette points out, there is no holistic approach in the way government delivers healthcare. “WHO defines health as not just the absence of disease but looks at the overall wellbeing of an individual,” she said.

Amindeh Blaise Atabong is a Cameroonian print and multimedia journalist. His interests include gender, human rights, climate change, environment, tech, conflict, peace-building and global development. In 2019, he was a finalist in the inaugural True Story Award, and also won a prestigious Kurt Schork Award in International Journalism (local category). He works for independent regional and international outlets, including for Quartz, Thompson Reuters Foundation News, Deutsche Presse-Agentur, Jeune Afrique, Epoch Times, African Arguments and Equal Times.

A very expensive white elephant

The Stiegler’s Gorge project is a 48-year-old folly that will not deliver the energy security that President John Magufuli seems convinced it will

Every aspirant dictator seems to want at least one Soviet-style mega-project to their name. It is almost as if the construction of a white elephant will validate the personality cult that they invariably build for themselves. The Stiegler’s Gorge hydropower project in Tanzania is President John Magufuli’s version, a project first conceived in 1972 and never implemented for reasons that I hope to make obvious in this piece. Colloquially known as “the bulldozer”, Magufuli has indicated that any vocalised objection to the project will land the objector in prison.

When I first travelled to Tanzania in early 2016, the nation was euphoric about Magufuli having come to power, despite serious problems with the previous year’s elections. His ruling party, the Chama Cha Mapinduzi (CCM) lost the Zanzibar element of the 2015 elections but then won the 2016 re-run. The party has been in power for 59 years now. According to the co-opted electoral commission, the CCM’s Magufuli won the 2020 elections with an outlandish 85% of the vote. There is zero evidence that the elections were credible, free or fair. The opposition, whose candidate Tundu Lissu received only 13% of the vote, had little to no chance of winning, largely because it’s extremely risky to be an opposition politician given the levels of violent repression to which the CCM has resorted to maintain power.  

Stiegler’s Gorge, Tanzania. Photo: Ross Harvey

Magufuli won the (mainland) 2015 elections on an anti-corruption ticket. In a nation racked by a history of extensive grand corruption, he represented a welcome reprieve. By 2014, Tanzania scored a dismal 31 (out of 100) on Transparency International’s Corruption Perception Index. Since coming to power, Magufuli has improved that score to 37. However, it is one thing to move the needle on petty corruption; it’s another entirely to put an end to grand corruption. There’s only so far that he can go before he clashes with his own loyalists within the CCM. In a de facto one-party state, internal divisions matter more than the official opposition for power retention calculus.   

Corruption is not only about embezzling money; sometimes it’s about making decisions that are corrupted by illusions of grandeur. Magufuli is bulldozing ahead on the Stiegler’s Gorge hydropower project in a way that actively suppresses information and transparency. I visited the site in 2017 and witnessed the remains of past attempts to build this dam – a physical expression of the lack of wisdom at attempting such a project. The gorge is spectacular; it sits in the heart of the photographic tourist concession of what is now the Nyerere National Park (previously the Selous Game Reserve), declared a World Heritage Site in 2014.   

Upon arrival at the site, I was chased down by what I initially thought were security police. They had been tipped off that my guide was taking me to see the gorge. Turns out they were actually part of the bid adjudication committee and had come to instruct me to appear at their offices if I was interested in winning the tender. Upon assuring them that I had no intention of bidding, a more relaxed conversation ensued. They confessed that most interested parties, upon seeing the sheer wildness of the setting and the logistical difficulties associated with dropping enough concrete to build a 134m-high wall, simply disappeared. Cause for hope? 

My optimism was misplaced. I returned to Nyerere National Park in September 2019 only to be met by trucks barrelling down the main road, kicking up dust and disturbing the wildlife. Perhaps nothing epitomised the contradiction more than the joy of watching young wild dog pups frolicking in a pool alongside this very main road – the conveyor belt of destruction. Beyond that, the country was palpably in the grip of fear. Every taxi driver, shop owner and interview respondent expressed their apprehension at voicing any concerns, especially about Stiegler’s.  

Magufuli had gone ahead despite all the academic literature and feasibility studies cautioning against damming the Rufiji River (again). There are already two dams upstream placing pressure on the hydrological flow into the gorge, compounded by increasingly less rainfall, a partial function of the ravages of climate change. Nonetheless, construction is expected to be complete by 2022.  

Not even the World Bank funds hydropower anymore, and most of the world has learned its lessons about the negative impacts of large dams. But Magufuli has bullishly declared that Tanzania, a country pretty much bankrupt and heavily donor-dependent, will self-fund the build. A government spokesperson has stated that the $309.6m required for the initial phase has already been provided.  

Magufuli’s justification for the project – when he still bothered to provide one – was that access to electricity is woefully low in Tanzania. He has a point. According to the World Bank, only 35.6% of the total population had access, while only 18.8% of the rural population (still a majority) had access. The country’s total power generation capacity currently sits at 1,500MW. Magufuli (and pretty much no one else) believes that Stiegler’s would generate a further 2,100MW on its own. While this white elephant will be the most expensive investment in Tanzania’s history, its opportunity costs are where the real expense lies. 

A recent policy briefing on the project indicated that if environmental and social costs were considered, but excluding cost overruns and delays, the total cost of the build would amount to roughly $4.95bn, whereas the global average for a 2,100MW project would be roughly $3,74bn. Environmental economists are particularly interested in negative externalities (the divergence between private returns and social costs). In this case, it is near impossible to determine the long-term costs of the downstream environmental devastation that will almost certainly materialise.  

For instance, oxbow lakes near the coast will likely lose connections that sustain unique fish species. That kind of biodiversity loss is irreversible and therefore cannot be easily costed. Moreover, natural flooding will not be easily replicated or controlled, which will result in nutrients required for downstream agriculture not reaching their natural destination. The risk of food insecurity will arise. Worst, though, is that the delicate ecological equilibrium supporting abundant wildlife will be severely distorted.  

One of Tanzania’s unique selling points is that the Nyerere National Park is the largest reserve in Africa, roughly the size of Switzerland. It is one of the last wildernesses on earth with an extraordinary array of animal and plant heterogeneity. I had the privilege of spending a night at one of the reserve’s six extraordinary lakes in 2019 – one of the six lakes upstream of Stiegler’s Gorge that comprise the primary tourism offering. It is hard to imagine what this area will look like when the dam is built. The sheer increase in traffic volume during the build process is a nightmare in itself, independent of the long-term impacts and resultant opportunity costs. Tanzania would be well advised to do everything possible to avoid foregoing tourism revenue given that it is one of the country’s only serious economic propositions (currently accounting for at least 14% of the country’s GDP, the impact of COVID-19 notwithstanding).  

But what about electricity access for Tanzania’s citizens? There are two things to consider in closing. First, the Stiegler’s Gorge dam will not deliver as promised. Upstream abstraction and reduced rainfall upstream will affect the flow of water into the dam and hence the volume of power that can be generated.

Moreover, global average cost overruns on mega-projects like these are substantial, with one recent study estimating cost overruns of 96% and average delays of 43 months. Hydropower costs alone have risen by 31% in the past decade.

The Stiegler’s build is expected to take nine years for stage one and three years for stage two. Even if this deadline is met (highly unlikely), the total cost (assuming an annual escalation rate of 3.4%) by 2027 would be $7.58bn. If Tanzania was lucky and only incurred an overrun of 30%, its 2027 cost would sit at $9.85bn. In a word, this is unaffordable for a highly indebted state, especially considering that this is the third year of the project and it’s barely started.  

The proposed Stiegler’s Gorge hydropower project will not only harm livelihoods in the area, but also damage one of Tanzania’s top tourist attractions. Photo: Ross Harvey

Second, there are far more cost-effective options available for securing greater access to electricity that do not rely on the expansion of expensive centralised grid transmission infrastructure (yet to be built). Hydropower is simply no longer a competitive source of electricity generation, especially when the opportunity costs are considered. Moreover, Solar PV farms can be implemented within a year (as opposed to nine years) and deliver electricity at a far lower levelised cost per kilowatt hour. In 2017 alone, China installed 53GW of solar power.  

There’s no reason Tanzania cannot pursue a strategic combination of wind and solar power to generate the 2,100MW that it needs. To quote Dr Joerg Hartmann, an independent consultant specialising in assessing hydropower feasibility, “In combination with existing gas and hydropower resources, solar in particular can provide reliable baseload power, much less exposed to hydrological uncertainty.”  

But the “bulldozer” seems unlikely to be persuaded by reason and his legacy will not be one of grandeur. To the contrary, Magufuli’s Stiegler’s Gorge project will be a white elephant, one that jeopardises the country’s tourism offering, kills its wildlife and does not deliver electricity as promised to a citizenry that really deserves better.  

Dr Ross Harvey is Director of Research and Programmes at GGA. Ross is a natural resource economist and policy analyst, and he has been dealing with governance issues in various forms across this sector since 2007. He has a PhD in economics from the University of Cape Town, and his thesis research focused on the political economy of oil and institutional development in Angola and Nigeria.

Rocky ride for Nigeria’s power sector

West Africa’s powerhouse – bedevilled by infrastructural decay, corruption, inefficiency and lack of capacity

 

Nigeria, sub-Saharan Africa’s largest economy in GDP terms, is one of the most underpowered countries in the world. With a population of nearly 200 million people, years of dysfunction in the power sector means that Nigeria has one of the lowest electricity per capita rates in the world at 150 KW per hour.

In the second-largest economy, South Africa, the per capita consumption is nearly 4,500 KW per hour. About 47% of Nigerians do not have access to grid power, and those who do have access have regular power cuts, according to World Bank (2020).

A combination of infrastructural decay, corruption, inefficiency and a lack of capacity have undermined reform efforts over decades. It is estimated that the Nigerian economy loses $28bn annually due to its power deficit, according to the World Bank.  


Vendors sell meat at the Oshodi night market in Lagos, late on June 6, 2015, lighting their stall with a fuel lamp in absence of electricity. Corruption, conflicting interests, mismanagement and labour unrest have for years plagued Nigeria’s power sector. Photo: Pius Utomi Ekpei/AFP

Just over 4,000 MW is available for distribution to the national grid, against installed capacity of 13,400 MW. This is due to infrastructure challenges and supply constraints of gas, which provides 80% of power to the grid. The system also suffers from heavy technical and non-technical losses through the chain. By contrast, South Africa, despite having its own power woes, has installed capacity of just over 44,000 MW for a third of the population. 

In addition to gas, Nigeria’s power comes from its large hydropower resources and generation from biomass and waste. Renewable energy is starting to attract private sector investment and is benefiting from the government’s roll out of solar power to boost rural electrification efforts. National independent power projects also contribute power to the grid.  

But for now, the reality is that most Nigerians still rely on fuel-powered generators, which, collectively, provide eight times more power than the national grid. Nigerians spend an estimated $14bn a year to buy and run them, according to the country’s Rural Electricity Agency (REA) and other experts, money that could be more usefully spent on clean energy options or paying for reliable grid power. 

A much-heralded plan to privatise the generation and distribution arms of the national utility has fallen short of expectations that the process would be a silver bullet for Nigeria’s longstanding power woes. Despite the billions spent on the sector, consumers are, in effect, no better off now than they have been for the past few decades. 

When the privatisation option was first put on the table in 2005, the national electricity provider, Nigeria Electric Power Authority (NEPA), was suffering from the effects of years of under investment. Its poor service had become the butt of jokes, with many saying the acronym stood for Never Expect Power Again.  

In 2005, legislation was put in place to kick-start a privatisation process. NEPA was unbundled into 11 distribution companies (known as Discos) and six generation companies (Gencos), with the government retaining ownership of the transmission infrastructure, responsible for linking the generation companies to the distributors. The authority was renamed the Power Holding Company of Nigeria.   

Political elites with international partners and local conglomerates were the main buyers of the assets, which raised about $2.5bn. The process, which was only completed in 2013, was expected to generate significant investment into the sector, end decades of debilitating power shortages and turbo-charge the economy. But the expectations were overly optimistic. Seven years later, the power system is still on life support. 

A man holds a placard during a demonstration to protest against the 45 percent raise of electricity prices on February 8, 2016 in Lagos. Photo: Pius Utomi Ekpei

It has become apparent that the privatisation model was flawed, says Precious Akanonu of energy think tank, Energy for Growth. A range of factors, including the non-payment of electricity bills by users (including government institutions) and unrealistically low tariffs, made it impossible for the companies to recover costs and get a return on investment. The bidders, some with no experience of the sector, took a leap of faith, buying decrepit assets and entering a sector with embedded structural problems, including the vulnerability of the gas infrastructure to vandalism and attacks in Nigeria’s oil and gas hub, the Niger Delta.  

Akanonu says that the inability to recover costs meant the Gencos and Discos were unable to repay the $780m borrowed from Nigerian banks for the initial purchase, deterring the banks from providing further loans for investment into infrastructure improvements. The Discos have also battled to get consumers to pay, with collection rates only about 30% of debts owing. A culture of non-payment for services has developed over time as people battle with unreliable electricity, which has forced them to spend money on alternatives, mostly costly generators. 

Millions of Nigerians do not have meters and are charged on estimated, rather than actual, electricity usage, which they say often bears no relation to how often they get power.

To generate more power requires more investment, but investors are unlikely to invest in a business that is not paid for its services. It is a real conundrum. 

The government set up the Nigerian Bulk Electricity Trading Company (NBET) in 2010 as a middleman between the Gencos and Discos in an attempt to get the system working optimally. NBET guaranteed it would buy power from the Gencos and supply the Discos, who would repay it from collections. But it has become a victim of the same culture of non-payment and its resources were quickly depleted. It, too, now owes the privatised companies millions of dollars, further threatening the viability of the system.  

The transmission utility, which runs the national grid, is another sticking point. Retained by government in the privatisation process, it suffers from the same bureaucratic inefficiency and under-investment that once plagued the entire system.  

So what to do? In 2020, the country’s senate, among others, called for the privatisation process to be reversed, citing a lack of progress under the reform programme. But the calls have met resistance. The Association of Power Generation Companies says the government, which still owns 40% of the privatised assets, should rather address the deep-seated structural issues.  

The Director General of the Bureau of Public Enterprises (BPE), Alex Okoh, says re-nationalising the power assets would be a serious mistake.  “I think the Discos have become a topical and very emotive issue. We forgot that the electricity sector was almost dead before it was privatised. We must be extremely careful about these key national utilities.”  Fixing the problem, he says, requires analysing the entire value chain. 

Power expert Sonny Iroche, a former executive with the transmission utility, says reversing the process would be a blow to Nigeria’s reputation as a business destination. “The non-adherence to the sanctity of agreements is not wise. People have committed resources to this process because of the sanctity of agreements.” He says the Covid-19 crisis gives Nigeria an opportunity to reposition the sector and let it realise its potential. “Nigerians aren’t interested in who executes the services. They just want it done. We need to all join hands and look at the problems.”  Nigeria, Iroche says, does not exist in a vacuum and it should be able to execute these functions optimally as countries do around the world. “There is no Nigerian way of doing things, there is only the proper way.” 

Writing on Nigerian website Stears Business, financial journalist Osato Guobadia says, “The worst-case scenario is that lenders who granted loans to the owners of the Gencos would liquidate their assets and sell the power plants to repay the loans taken. Realistically, given the strategic importance of the power plants, the government is highly unlikely to allow that to happen.”

The best-case scenario is that the discos can improve revenue collection. As the worst offenders are state-owned enterprises, Guobadia suggests the government could take money from their annual budgets and pay it directly to the Discos to clear the debt. But, he says, there is unlikely to be political will for this. There is a third way, he says. “The default scenario is that Nigerians could keep picking up the slack. We could keep granting loans to NBET to pay the Gencos and give newer ones to pay off existing debts. This would potentially evolve into a debt crisis, but at least it would keep our lights on. At least, for now.” 

Hopes are now pinned on the Presidential Power Initiative to address the problems. This is a deal with German energy giant Siemens to rehabilitate and expand the grid. It includes upgrading 105 power substations, constructing 70 new ones, distributing up to 35 new transformers as well as installing distribution lines. The target is 25,000 MW of electricity by 2025 – a tall order, given the deep-seated challenges.   

The government is also pushing for greater efficiency in the commercial uses of its enormous gas reserves. Olabode Sowunmi, Senior Legislative Aide to the Senate President and founder of the Energy Hub, says the process is being driven by the Gas Master Plan. “This is essentially an aggregation of policies targeting investments and the development of infrastructure to support the investments,” he says. 

The government is also fast-tracking the rollout of meters, offering a one-year waiver of import levies on equipment to bring down the costs for consumers. It is also, under pressure from multilateral organisations, moving towards implementing cost-reflective tariffs in the sector and introduced a tariff hike in September 2020 towards this end. Part of the privatisation challenge has been the fact that tariffs have not reflected the real cost of power, which has effectively been subsidised for years. 

While the grid is already powered by gas, the government wants to use the resource to build resilience in other parts of the economy. It has directed 9,000 filling stations to reconfigure their infrastructure to use gas, and the Association for Local Distributors of Gas has been established to drive downstream gas distribution to commercial and industrial end users.  This has come at a bad time for Nigerians, suffering financial hardships resulting from the pandemic, but many believe it is also a good opportunity for Nigeria to “bite the bullet” and take the tough decisions to make the economy more resilient.

DIANNA GAMES is the chief executive of business consultancy Africa @ Work and a regular columnist on African issues for Business Day newspaper. She is a fellow of the GIBS Centre for Dynamic Markets in Johannesburg.

Power for the people

Africa’s energy deficit requires a multi-layered approach

Africa faces a gigantic energy challenge. Latest estimates are that on the continent 600 million people, virtually all residing in sub-Saharan Africa and amounting to more than half the population, still don’t have access to electricity. Added to this, Africa has the youngest and fastest growing population on the planet, which is expected to double to 2.5 billion people by 2050. The International Energy Agency (IEA) expects energy demand to grow by 60% by 2040, in a situation where already the vast majority of people are either not served or underserved with electricity, with power cuts across the continent having a hugely detrimental economic impact. 

Traditionally, the answer to this energy problem has been to build big energy infrastructure projects, grow the generation capacity of national grids and connect more people to the national grid. Large infrastructure projects, such as the Grand Inga Dam Hydroelectric project in Democratic Republic of Congo (DRC), which has the potential to provide 40,000 MW of hydropower to the continent – approximately 40% of its current electricity needs, initially appear to be the solution. Get enough funding into this and other similar projects, grow the grid to reach every single person in Africa and the energy crisis is solved. 

However, the project has almost come to epitomise the problems of relying on mega-infrastructure projects to supply power to those without it across Africa. It is beset with problems that have dragged on for decades. The project consists of six phases, at a conservative estimated cost of $80 billion, the first was completed in 1972, the second in 1982 with the third expected in 2028. It currently provides just 1,775 MW of power. 

Solar panels at the new 15 MW photovoltaic (PV) power plant supplying the Canadian mining company Iamgold’s Essakane gold mine, near Dori in northern Burkina Faso. Photo: Ahmed Ouoba/AFP

Though the Inga Dam’s scale is unparalleled, the types of problems it has encountered and continues to do so are not unique. Financial, political and logistical problems have all beset the project, with various partners dropping out, questions over transparency and accountability as well as legal and parliamentary challenges causing never-ending delays and increasing costs. 

“The reality is that sub-Saharan Africa won’t follow the same electrification path we’ve seen in other parts of the world,” summarised David Riposo, energy access advisor at Power Africa, the US government-led partnership with the goal of adding more than 30,000 MW of new electricity generation capacity and 60 million new electricity connections for homes and businesses by 2030. “Much of the continent still consists of rural villages located far from major roads, making traditional grid extension to these communities uneconomical in the short-term.” 

However, there would appear to be a solution: decentralised renewable energy (DREs) consisting of mini grids that would be off the main national grid and powered by small-scale electricity generation, typically less than 15 MW, to supply power to a limited number of customers. These also have the benefit of being able to offer clean and affordable renewable energy rather than from burning fossil fuels or using kerosene, which is a comparatively costly fuel source yet so often used in large areas of the continent where electricity is sparse. 

DREs arecheaper, faster, and easier to deploy in rural and remote areas that are untenable for grid electrification, or may not be connected by the grid in the near term. African Development Bank (AfDB) is committed to dramaticallyexpanding its investments inand financing fordecentralised renewables,” says Daniel Schroth, acting director for Renewable Energy and Energy Efficiency at the bank. “We see immense potential for expanding finance for microgrids/mini-grids in Africa. 

As does the IEA which, in its 2019 Africa Energy Outlook report, suggested grid-based electrification is the least-cost option for 45% of the continent’s population. This leaves the majority, 55%, to come from off-grid and mini-grid connections. Despite this, large infrastructure projects do experience further problems. On top of being expensive, running into serious delays, ballooning costs and failing to reach those living off the grid there can also be difficulties in getting them online and connected to a country’s electrical grid system in the first place. 

For instance, Nigeria currently has a generation capacity of 12,522 MW, but it has a theoretical transmission capacity of only 7,500 MW, meaning it is unable to distribute across its grid the electricity generated if all its power stations are running correctly. Though, due to recurrent problems around maintenance, trips, faults and leakages that make many of the power stations unable to supply the grid, the country’s average operational capacity is approximately 3,879 MW, with a peak of 5,244 MW, which was achieved last year. A lack of maintenance, along with a lack of investment in the transmission capacity side of grid infrastructure, has resulted in a transmission network that cannot provide for the energy needs of the country.  

As the continent’s biggest economy with a large and growing population, Nigeria’s energy needs are severe. Currently, the country’s electricity demand is estimated to be four to 12 times what the grid is currently supplying, and that need is only going to grow.  

One example of this problem with transmission capacity not matching generational capacity was the Lake Turkana Wind Power (LTWP) project in northern Kenya. LTWP was a 310 MW project, which cost $680 million and was financed as a public-private partnership (PPP), securing debt investment from a syndicate of banks led by the AfDB, although the World Bank declined to invest, citing concerns over the power purchase agreement with the Kenyan government.  

As Africa’s largest wind project that would increase Kenya’s power generation capacity by roughly 17%, as well as save the equivalent of up to 736,615 tonnes of carbon dioxide being released into the atmosphere each year. it appeared to be an ideal energy project for Africa. From initial discussions in 2005, the whole project was built and ready to begin transmission in 12 years. In addition, the project used an innovative financial structure and pulled in private capital from institutional investors, with funding guarantees by the AfDB and European Investment Bank (EIB). It also had capital from the EU-Africa Infrastructure Trust Fund (EU-AITF), a financial instrument, which blends development finance institution monies with grant monies from the European Commission, to fill the equity gap 

A man guards the wind turbines at the Lake Turkana Wind Power project in Loiyangalani District, in Marsabit County, approximately 545 kilometres north of Nairobi. The farm has 365 turbines, each with capacity of 850 kW. The wind farm is providing reliable, low cost energy to Kenya’s national grid. Photo: Simon Maina/AFP

However, once it was ready, the transmission line to connect it to the grid had not been completed. The construction of the 435 km transmission line had run into several problems with the contracted company experiencing financial difficulties and work needing to be redone. This led to a 15-month delay and resulted in the Kenyan government having to pay $52.5 million to LTWP in fines from lost revenue, which was ultimately paid by the Kenyan taxpayer who were unable to access the electricity from the project. Despite this incident, the AfDB remains committed to large infrastructure projects in potentially unconnected areas as these were all potential problems that were considered before LTWP started as a project. 

“AfDB is supporting interconnections, development of regional power markets and strengthening of transmission and distribution networks; all with a view to giving countries access to large competitive power markets and meeting energy security needs in a cost-effective manner,” explains Schroth. However, “AfDB’s interest in decentralised solutions (including micro-grids) is not so much a reaction to challenges seenwithin the utility-scale landscape – because we need to address these as well,” he adds.  

Yet mini-grids have their own problems, most notably scale and financing. 

“Financing continues to be a challenge for the off-grid sector in sub-Saharan Africa,” explains Power Africa’s Riposo. “Revenue risk exceeds the tolerances of many lenders, and the capex is too small for conventional project finance.” 

Schroth agreed, adding: “There is still a lack of pure commercial financing as the mini-grid market lacks scale, and developers’ project track records are limited.”  

Organisations like Power Africa and the AfDB are both looking to support mechanisms, such as the Sustainable Energy Fund for Africa (SEFA) and Beyond the Grid Fund for Africa that look to address this funding issue and galvanise investment into mini grids with innovative blended finance facilities. 

“Mini-grids/microgrids are not and should not be seen as a competitor to the utility-scale projects but as a complement,” Schroth concludes. “The choice of one or the other, or both in different geographies depends on the desired tier of access, their economic viability, and the new opportunities brought by technological progress.” 

Joe Walsh is a freelance journalist based in Johannesburg. He writes about the environment, energy and the green economy as well as politics and society for British publications, including Environmental Finance, the New Statesman and The New European.
 

The struggle to keep pace

Africa’s collective electricity supply is bedevilled by weak legal frameworks and regional rivalry

An estimated 580 million Africans lack access to electricity, three quarters of the global total. The International Energy Agency (IEA) expects this number to rise as the COVID-19 pandemic stalls efforts to keep up with rising demand. 

Before coronavirus struck, the continent had been making slow progress towards Sustainable Development Goal 7 – Ensuring access to affordable, reliable, sustainable and modern energy for all – but it now stands little chance of meeting this target by 2030.

Despite extensive petroleum reserves, high solar irradiation levels and vast hydropower potential, Africa receives only 4% of global energy supply investment, according to the IEA. This is largely a result of foreign investors’ fears that short-term political considerations will trump long-term policy goals, rendering energy master plans obsolete. Investors’ primary concerns include abrupt changes to the policy environment, unsustainably low electricity tariffs dependent on unaffordable state subsidies, and the poor governance and creditworthiness of state-owned utility companies. A whopping 95% of African energy utilities fail to recover their costs, according to the Energy for Growth Hub, scaring off potential investors. 

Regional cooperation on energy promises potential solutions in three key areas. First, cross-border partnerships increase market size, making projects more likely to attract foreign investment. Second, regional connections enable countries with surplus electricity to share it with neighbours experiencing shortfalls thereby making power supplies more reliable. Third, a regional market can help drive down the costs for consumers if utility companies are mandated to purchase the cheapest available power. All three trends help to promote a shift in the energy mix by maximising the potential of new renewable sources at the expense of older and inefficient thermal generators.  

Power lines leaving the Eskom Duvha power station, some 15 km east of Witbank, South Africa.  Photo: Marco Longari/AFP

Africa’s regional economic communities have already taken steps to integrate through power pools, which enable national utility companies to plan and operate their collective electricity supply and transmission in the most reliable and economic manner given their load requirements. These power pools have the potential to promote investment in new hydropower capacity, reducing power system operating costs by $2.7 billion each year, and carbon dioxide emissions by 70 million tonnes per annum, according to estimates by the World Bank.  

The Southern African Development Community (SADC) was the first regional economic community to connect national electricity grids and form a common market for electricity, establishing the Southern Africa Power Pool (SAPP) in 1995. Rising power demand in South Africa and at energy-intensive mining projects elsewhere in the region helped to attract foreign investment. This led to the creation of the Copperbelt Energy Corporation, a private Zambian electricity generation, transmission, distribution and supply company, in 1997, and Motraco, a joint venture between Mozambique, South Africa and Swaziland to upgrade cross-border transmission lines in 1998.  

This early progress spurred the signing of bilateral contracts between the member countries, followed by the development of a Short-Term Electricity Market in 2001 and a Day-Ahead Market in 2009. By 2010, 7.5% of power generated in the region was being traded across the SAPP, according to the Infrastructure Consortium for Africa. However, this early progress in trading was not accompanied by comparable attention to the institutional environment. SADC failed to establish an independent regulator to oversee compliance with technical codes, regulate prices and promote competition. The weak legal framework and the absence of an autonomous dispute-resolution body undermined the pool’s prospects, according to a report commissioned by the World Bank.   

Regional rivalry also undermined SAPP’s prospects, with SADC energy ministers unable to agree on a list of priority projects, thus missing opportunities to secure new investment in power production during the 2000s.

Uneven development left members overly reliant on Eskom, the utility company in regional hegemon South Africa, which had both the most installed capacity and was the top buyer of surplus electricity. A wave of power cuts in South Africa forced other members of the pool to implement load-shedding from 2008 onwards. Rather than address this challenge President Jacob Zuma mismanaged Eskom, leaving the utility company overstaffed and broke, undermining its ability to honour contracts through SAPP.  

The Economic Community for West African States (ECOWAS) was more pragmatic than SADC when it established the West African Power Pool (WAPP) in 1999. Recognising the chronic energy shortages which plagued the region’s economic engine, Nigeria, WAPP adopted a more pragmatic, two-tier approach. Where reliable connections existed, steps were taken to forge a common market for electricity. Bilateral power purchase agreements enabled Côte d’Ivoire to export surplus energy to neighbouring Ghana, which was grappling with power cuts, and onwards to Benin and Togo, which as small countries had struggled to secure investment in their grids. By 2010, 6.9% of power generated in the region was being traded across this bloc, according to the Infrastructure Consortium for Africa.  

Where reliable connections were lacking, the focus was on linking the hinterland to more developed coastal nations. Thus inland Burkina Faso gained access to power from Ghana and Côte d’Ivoire, while Niger was hooked up to Nigeria. But a number of smaller economies remain left behind, with laggards Guinea, Liberia, Mali and Sierra Leone still busy aligning their systems in the hope of accessing cheaper energy supplies from elsewhere in the WAPP. Other countries have forged their own path. Senegal initially cooperated with Mali and Mauritania to share hydropower from the Manantali dam, but President Macky Sall has since focused on upgrading his country’s installed capacity and grid, eyeing abundant offshore gas reserves. This threatens to leave Senegal’s smaller neighbours Guinea-Bissau and Gambia in the dark.   

While the WAPP’s approach risks exacerbating regional inequality, it has at least developed a more robust framework, including a stronger and more autonomous secretariat capable of promoting priority projects and finalising decisions rather than waiting for national governments to act, according to a report commissioned by the World Bank. ECOWAS also took the critical step of establishing a Regional Electricity Regulatory Authority (ERERA), which became operational in 2011, addressing the lacuna identified in the SAPP.  

The thermal power station of Ivory Coast’s electricity production company Ciprel, a subdivision of French industrial group Eranove.  Photo: Sia Kambou/AFP

In the middle of the continent, the Economic Community of Central African States (ECCAS) has failed to emulate ECOWAS’ dynamism through the Central Africa Power Pool (CAPP), which it founded in 2003. 

Hugely ambitious plans to build new transmission lines required to unlock the vast hydropower potential of the River Congo have yet to move beyond the drawing board, with neither donors nor the private sector willing to tackle myriad political, regulatory, macroeconomic and security risks.  

Greater hope lies in the Eastern Africa Power Pool (EAPP), which was formed by seven Common Market for Eastern and Southern Africa (COMESA) members in February 2005. Although the World Bank dismissed regional energy trade as “negligible” less than a decade ago, investment in new dams and transmission lines promises to make Ethiopia and Kenya major electricity exporters. While Kenya has mastered geothermal power from the Rift Valley, Ethiopia is doubling its installed generation capacity courtesy of the 6,000 MW Grand Ethiopian Renaissance Dam (GERD), which is expected to become fully operational in 2023. Such vast potential convinced the World Bank and African Development Bank to fund a new 2,000 MW transmission line between the two countries, which was completed last year. The GERD promises to lower electricity costs, transform the energy mix and make power supplies more reliable across EAPP.  

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COMESA has also moved to establish common legal, regulatory and institutional frameworks. In 2012, the EAPP established an independent regulatory board to supervise the pool, ensure compliance with electricity codes and technical standards, and regulate the use and price of transmission lines. The regulator also plays a role in enforcing standards and resolving disputes, helping to encourage private investment, thus promoting competition in the pool progressively. For now, the focus is the Day-Ahead Market, but the EAPP aims to move to a centralised trading regime in the next five years, according to the Infrastructure Consortium for Africa.   

[However, Francois Pienaar, Business Development Manager at ESB International and a former consultant to utilities in Ghana, Liberia and Tanzania, worries that “billions spent on interconnections will be wasted” without greater attention to regional integration. Too many African governments focus on short-term objectives, such as subsidising electricity to key electoral constituencies to retain their political support, rather than considering how to address the contingent financial liabilities of national utility companies. Moreover, the energy sector has to vie for attention with competing industries, including the transport sector, beloved by politicians seeking visible projects. 

The outlook is also complicated by COVID-19. “A crisis can often predispose policymakers to undertake more politically risky energy sector reforms”, as Alan David Lee and Zainab Usman note in their World Bank paper, Taking stock of the political economy of power sector reforms in developing countries. Yet Dr Usman told Africa in Fact that “the coronavirus pandemic has dramatically increased fiscal pressures in ways that could make African governments subordinate electrification projects to more urgent priorities.” The strengthening of Africa’s power pools therefore looks to be among the many casualties of the current public health emergency, increasing the number of Africans deprived of access to electricity. 

Nick Branson, Director of Gondwana Risk, advises foreign investors on key African markets and helps African governments to fine-tune their policy objectives. Nick has extensive experience of conducting research across the continent and producing actionable analysis for a range of different audiences. Nick undertook doctoral studies at SOAS, University of London, and previously worked at the think tank Africa Research Institute.

 

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