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Hybrid power markets in Africa: Generation planning, procurement and contracting challenges

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  • Malgas, Isaac
  • Eberhard, Anton

Abstract

African power sectors are generally characterised by insufficient generation capacity. Reforms to address poor performances in the 1990s followed a prescribed evolution towards power markets that would allow wholesale competition amongst generators and so lead towards efficiency improvements. Despite reforms being embarked, competitive power markets have not been established in Africa; rather, the result has been the emergence of hybrid markets where state-owned generators and IPPs operate devoid of competition; and although IPPs have emerged in a number of African power sectors, many countries still do not have sufficient generation to meet their electricity demands. This paper investigates the development of private generation power projects in Africa by analysing data collected from both primary and secondary sources in four case studies of power sectors in Ghana, Côte d'Ivoire, Morocco and Tunisia. It identifies how planning and procurement challenges have lead to difficulties in adding sufficient generation capacity in a timely manner, exacerbating the problem of insufficient generation capacity in Africa. It provides suggestions as to how these frameworks could respond more effectively to the capacity challenges faced by hybrid electricity generation markets, and how broader power sector reforms should be guided to reflect the challenges of hybrid markets better.

Suggested Citation

  • Malgas, Isaac & Eberhard, Anton, 2011. "Hybrid power markets in Africa: Generation planning, procurement and contracting challenges," Energy Policy, Elsevier, vol. 39(6), pages 3191-3198, June.
  • Handle: RePEc:eee:enepol:v:39:y:2011:i:6:p:3191-3198
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    References listed on IDEAS

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    1. Nellis, John, 2005. "The Evolution of Enterprise Reform in Africa: From State-owned Enterprises to Private Participation in Infrastructure - and Back?," Privatisation Regulation Corporate Governance Working Papers 12193, Fondazione Eni Enrico Mattei (FEEM).
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    3. Vagliasindi, Maria, 2008. "Governance arrangements for state owned enterprises," Policy Research Working Paper Series 4542, The World Bank.
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    1. Eberhard, Anton & Gratwick, Katharine & Morella, Elvira & Antmann, Pedro, 2017. "Independent Power Projects in Sub-Saharan Africa: Investment trends and policy lessons," Energy Policy, Elsevier, vol. 108(C), pages 390-424.
    2. Morgan Bazilian & Patrick Nussbaumer & Hans-Holger Rogner & Abeeku Brew-Hammond & Vivien Foster & Shonali Pachauri & Eric Williams & Mark Howells & Philippe Niyongabo & Lawrence Musaba & Brian Ó Galla, 2011. "Energy Access Scenarios to 2030 for the Power Sector in Sub-Saharan Africa," Working Papers 2011.68, Fondazione Eni Enrico Mattei.
    3. Yun, Na, 2023. "Nexus among carbon intensity and natural resources utilization on economic development: Econometric analysis from China," Resources Policy, Elsevier, vol. 83(C).
    4. Zheng, Lei & Hao, Jia & Lv, Meijing & Wei, Fang, 2023. "The effects of natural resources and integration on green economic recovery: Foreign direct investment and environmentally friendly technologies in China," Resources Policy, Elsevier, vol. 87(PA).
    5. Gunther Bensch, 2019. "The effects of market-based reforms on access to electricity in developing countries: a systematic review," Journal of Development Effectiveness, Taylor & Francis Journals, vol. 11(2), pages 165-188, April.
    6. Eberhard, Anton & Gratwick, Katharine & Kariuki, Laban, 2018. "Kenya's lessons from two decades of experience with independent power producers," Utilities Policy, Elsevier, vol. 52(C), pages 37-49.
    7. Liang, Shuai & Wang, Peng & Jia, Cunlu & Zhu, Jialan, 2023. "Studying green financing, factor allocation efficiency, and regional productivity growth in renewable energy industries," Renewable Energy, Elsevier, vol. 214(C), pages 130-139.
    8. Eberhard, Anton & Gratwick, Katharine Nawaal, 2011. "IPPs in Sub-Saharan Africa: Determinants of success," Energy Policy, Elsevier, vol. 39(9), pages 5541-5549, September.
    9. Pueyo, Ana, 2018. "What constrains renewable energy investment in Sub-Saharan Africa? A comparison of Kenya and Ghana," World Development, Elsevier, vol. 109(C), pages 85-100.
    10. Trotter, Philipp A. & Maconachie, Roy & McManus, Marcelle C., 2018. "Solar energy's potential to mitigate political risks: The case of an optimised Africa-wide network," Energy Policy, Elsevier, vol. 117(C), pages 108-126.
    11. Asantewaa, Adwoa & Jamasb, Tooraj & Llorca, Manuel, 2023. "Electricity sector reforms and cost efficiency: The case of small electricity systems in Sub-Sahara Africa," Economic Analysis and Policy, Elsevier, vol. 80(C), pages 880-893.
    12. Khan, Muhammad T. & Thopil, George Alex & Lalk, Jorg, 2016. "Review of proposals for practical power sector restructuring and reforms in a dynamic electricity supply industry," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 326-335.
    13. Alexis Vessat, 2017. "The role of unmet demand in the dynamics of energy supply forms: The case of electricity market structures in sub-Saharan Africa," Post-Print hal-01944317, HAL.
    14. Asantewaa, Adwoa & Jamasb, Tooraj & Llorca, Manuel, 2022. "Reforming Small Electricity Systems: Market Design and Competition," Working Papers 12-2022, Copenhagen Business School, Department of Economics.
    15. Trotter, Philipp A. & McManus, Marcelle C. & Maconachie, Roy, 2017. "Electricity planning and implementation in sub-Saharan Africa: A systematic review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 74(C), pages 1189-1209.

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    Power Sector Reforms;

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