AfDB Strengthens Electricity Reforms In West Africa With $2m Grant

(AFRICAN EXAMINER) – African Development Fund (ADF), the concessional window of the African Development Bank (AfDB) Group has approved a technical assistance grant of $2 million to fund research that will contribute to electricity reforms in the Economic Community of West African States (ECOWAS).

Established on 28 May 1975 via the Treaty of Lagos, ECOWAS is a regional organization that promotes economic integration in the constituting countries. ECOWAS consists of 15 countries, including Benin, Burkina Faso, Cabo Verde, Côte d’Ivoire, Gambia, Ghana, Guinea, Guinea-Bissau, Liberia, Mali, Niger, Nigeria, Senegal, Sierra Leone, and Togo. Covering about 6.1 million km2, ECOWAS has an estimated population of 360 million people.

Similarly, the ADF which was established in 1972 and became operational in 1974, comprises, to date, 32 contributing countries and benefits 37 countries. The 37 ADF-eligible countries include those that are increasing their economic capacities and heading toward becoming the new emerging markets as well as those that remain fragile and need special assistance for basic levels of service delivery.

The ADF contributes to poverty reduction and economic and social development in the least developed African countries by providing concessional funding for projects and programs, as well as technical assistance for studies and capacity-building activities. The Fund has cumulatively invested UA 29.4 billion (USD 45 billion) over its 44 years of operationalization on the African continent.

The support of the African Development Bank to ECOWAS will improve access to energy in the 15 countries of the West African region.

The grant will go to the ECOWAS Regional Electricity Regulatory Authority. The ultimate objective is to stimulate cross-border electricity trade and improve energy access in the 15 countries in the region.

The project has five components. The first involves selecting electricity regulatory principles and key performance indicators from the Bank’s flagship Electricity Regulatory Index for Africa report, to be adopted by the ECOWAS Regional Electricity Regulatory Authority.

As part of this component, the project will build capacity in member countries for collecting and reporting on these indicators on a common platform.

The second component will involve conducting a study in order to update a comparative analysis of electricity tariffs and their underlying drivers across the electricity value chain of ECOWAS.

The third involves developing a centralized database management system that will provide a platform for digitally collecting relevant energy information from member countries, storing, and disseminating them on a common digital platform.

The fourth component will assess and identify project bottlenecks and risks in ECOWAS member countries and recommend a coherent approach to progressively address ground-level barriers to investment in the power sector in pre- and post-establishment phases of the regional electricity market.

The final component focuses on program management and capacity building, which will be co-financed with the Regional Electricity Regulatory Authority. All components of the project will include gender-disaggregated data.

Project team leader at the AfDB, Solomon Sarpong said the project will ultimately facilitate regional electricity trade and help improve access to electricity.

“It will address major causes of fragility, such as infrastructure bottlenecks, youth unemployment, environmental challenges, gender inequalities, and regional development imbalances”, he said.