Making Africa's Power Sector Sustainable:Stakeholders' Policy Dialogue Forum

Opening Statement
by Josué Dioné
Director, Sustainable Development Division

Addis Ababa, Ethiopia
15-16 December 2005

Chairperson,

Distinguished Participants,

Dear Colleagues,

Ladies and Gentlemen,

On behalf of the Executive Secretary of ECA, it is my pleasure to welcome you to this Stakeholders' Policy Dialogue Forum on "Making Africa's Power Sector Sustainable". We are deeply grateful that you have accepted to come and share your invaluable expertise and experience on the difficult issues of power sector reforms with the view to improving access to reliable, affordable economically viable, socially acceptable and environmentally sound energy services in Africa.

Indeed, implementing well-designed reforms can help improve access to electricity and other modern energy services, which is essential for fueling sustainable development and achieving the Millennium Development Goals (MDGs) in our Continent. We all know that sub-Saharan Africa has the lowest electrification rate of all the major regions of the world.

Only 24% of the population in this region had access to electricity in 2002, compared to 94% for North Africa and an average of 66% for all developing countries. Sub-Saharan Africa accounts for 46% of the estimated 1.4 billion people without electricity in developing countries. And projections of the International Energy Agency (IEA) indicate that, by 2030, electrification rates will approach 100% for the Middle East, North Africa, East Asia and Latin America, while half the population of sub-Saharan Africa will still be without electricity.

Distinguished Participants,

This forum is very much in line with the recommendation of the Johannesburg Plan of Implementation (JPOI) of the World Summit on Sustainable Development (WSSD), which calls for supporting Africa's efforts to implement NEPAD objectives to significantly increase access to electricity and other modern energy services for African population, particularly in rural areas.

Moreover, the forum reflects a spirit of increasing cooperation within the UN system, as it is being held as a joint undertaking of ECA and the United Nations Environment Programme (UNEP), with strong support from the United Nations Department of Economic and Social Affairs (UNDESA), among other UN Agencies working together within the framework of UN Energy/Africa, the inter-agency collaborative mechanism for support to the NEPAD energy agenda.

Distinguished Participants,

Most African countries have embarked on power sector reforms following the World Bank 1993 Policy, which called for developing countries to implement comprehensive power sector reform programs by:

The working document, which is submitted for your consideration presents a compendium of experiences and lessons learned in implementing power sector reforms in 14 selected sub-Saharan African countries. As the selected countries are at varying phases of the reform process, the presence at this forum of participants from these countries should allow a thorough review of the assessments of the economic, social, institutional and environmental impacts of the reforms.

In a nutshell, the assessment report shows that the reform process in many countries has not provided for the adequate policy, institutional, legal and regulatory frameworks required to ensure the sustainability of the power sector. To address this major shortcoming, the report proposes a number of recommendations in the following three critical areas of concern: (1) enhancing access to electricity among the poor, (2) ensuring the use of environmentally-sound electricity generation options, and (3) addressing gaps and barriers in the legal and regulatory frameworks.

Access to electricity among the poor could be enhanced through, among other things, sequencing reforms in countries that are not yet at an advanced stage in the reform process; and linking the number of new connections to the issuance of licenses and concessions so as to ensure access to electrification for the poor.

The use of environmentally sound electricity generation options could be promoted, for example, by reviewing the Electricity Acts to provide for increased electricity generation from renewable energy sources; and promoting decentralized renewable-based generation.

Gaps and barriers in the legal and regulatory frameworks could be addressed through strengthening the regulatory agencies so as to ensure their effective independence from political interference, issuing licenses and entering into long-term power purchase agreements (PPAs) with independent power producers (IPPs), and leveling the "playing field" of renewable-based electricity to compete with conventional power generation.

Chairperson,

Distinguished Participants,

The challenge is big. But we are encouraged by the effective participation, at this forum, of high-ranking officials and officers of various backgrounds from our member countries, regional economic communities, international energy institutions and UN agencies, who are most knowledgeable and familiar with the critical issues of power sector reforms in developing countries in general, and Africa in particular.

I am, therefore, confident that your deliberations will help ECA and other partner institutions of the UN-Energy/Africa inter-agency group to come up with concrete and action-oriented recommendations for making the African power sector sustainable. And more importantly, I also hope that these recommendations will help African countries and regional economic communities (RECs) improve access to sustainable provision of electricity services for the benefit of all Africa's people, including the poor.

Let me conclude by expressing once again our appreciation for your contribution to this forum.

I wish you fruitful deliberations and I now declare open the Stakeholders' Policy Dialogue Forum on "Making Africa's Power Sector Sustainable".

Thank you.