Strengthening Regional Electricity Resilience through the Africa Single Electricity Market

On June 3 2021, The African Union officially launched the African Single Electricity Market (AfSEM). This marked the commencement of an electricity market that connected the power supply infrastructure of the Union’s 55 member countries. The goal is the development of one continuous efficient and affordable electricity market across the continent. 

On June 3 2021, The African Union officially launched the African Single Electricity Market (AfSEM). This marked the commencement of an electricity market that connected the power supply infrastructure of the Union’s 55 member countries. The goal is the development of one continuous efficient and affordable electricity market across the continent. When fully implemented, the AfSEM will be the largest single electricity market in the world, supplying power to over 1.3 billion people. To achieve this, the AfSEM aims to build upon the progress of regional power pools which have in some little way helped to facilitate cross-border electricity trading in different regions of the continent. 

Strengthening continent-wide power reliability

Pooling power generation capacity across different entities, regions and countries has helped make power supply to customers more efficient and affordable. In Africa today, different regional power pools allow for the sharing of power generation resources. These power pools help to increase energy supply, strengthen grid stability, and improve overall energy security in different countries. Four regional power pools exist across Sub-Saharan Africa; the Southern African Power Pool (SAPP), the West African Power Pool (WAPP), the Central African Power Pool (CAPP), and the Eastern African Power Pool (EAPP). The AfSEM aims to expand on the work and benefits that these regional pools provide on a larger scale. 

Electricity supply reliability remains a huge challenge for countries across Africa. Power rationing, outages, and grid collapses are huge fixtures for many markets. According to a 2022 survey by Afrobarometer, only 43% of Africans reported a reliable electricity supply, with significant variation across countries. For instance, in Morocco, 95% of people surveyed reported power supply reliability all of the time while only 5% reported the same in Malawi. 

The main factor influencing power supply unreliability across African countries is the lack of a diverse mix of generation resources. In Nigeria for instance, only about 33 per cent (4,211MW) of the total installed power generation capacity of 12,643MW is available for dispatch. This capacity of which 82% is comprised of gas-powered plants faces significant gas supply constraints that reduce their generation. The remaining capacity is provided by hydropower plants which are severely hampered by seasonal water availability. South Africa’s heavy reliance on coal has resulted in significant power supply challenges. To meet demand, the national utility, Eskom has relied on expensive diesel-powered Open Cycle Gas Turbine plants. In 2023, South Africa imported a total of 8,054 GWh from neighbouring countries during periods of peak demand. The country’s imports were limited by the supply capacity of the countries as only Mozambique provided 99.8% of the total imports. 

The AfSEM can help diversify the energy mix and available generation capacity in the region. Expanded electricity trade through a continent-wide interconnected power grid will link African countries’ power networks ensuring that countries and regions that produce surplus energy can transmit it to regions with a power supply deficit. This also means that trade will not be limited by the generation capacities of neighbouring countries as more varied power generation plants will be connected to the network. Varied generation resources will enhance energy security for all countries across the region. 

However, realising the goals of the AfSEM will require significant harmonization in regulations, technical standards, market rules and policies across these interconnected countries. Governments across the region need to do the work needed as without uniformity in the continent’s electricity market regulatory and policy frameworks, the benefits would never be realized.
 

*Image Credit: Kenya Electricity Transmission Co.

Join us at the Africa Energy Expo from 4 - 6 November in Kigali Centre Rwanda and experience the Africa energy landscape at its finest. The event will serve as a scene-setter to the Africa Power Vision by bringing key energy stakeholders together to increase the level of international support and facilitate access to modern, affordable and sustainable energy solutions in Africa.