Cross-Border Power Trading Model for SSA; Challenges and Opportunities of Operationalizing Power Pools in Africa

Over the years, significant milestones have been made in Africa towards power sector transformation and growth including the development of new power plants amidst a fast-growing population and corresponding electricity consumption every year. Notwithstanding, Sub-Saharan Africa (SSA) is still bedevilled with low levels of energy access and poor quality of electricity supply despite the continent's natural resource endowment with renewable and non-renewable energy resources. Africa's small, sparsely populated, fragmented, and frequently isolated economies present a strong argument for regional economic integration in order to enhance efficiency, take advantage of economies of scale, and thin out boundaries (Jaime and Tsikata, 2015). Regional electricity integration and cooperation through grid interconnection and power pooling is a potentially cost-effective way of connecting excess capacity in one country or region with (peak) demand in another, despite the requirement for better energy-producing capacity and transmission infrastructure inside African nations. The objective of this study is to assess the different levels of regional integration in Africa while outlining the associated challenges. In pursuit of these objectives, the paper would use a capacity expansion planning model covering both generation and transmission investments to simulate how the electric power systems in Sub-Saharan Africa may develop under different underlying scenarios of challenges. The paper will present the processes, general guideline lessons, and experiences pertaining to “good practices” for developing and operationalizing effective regional power pools.