twitter Facebook Linkedin acp Contact Us

World Bank: How to boost to private sector investment in Africa's transmission sector

(Image source: Windraider/Flickr)

A new World Bank report released at the African Energy Forum in Copenhagen this week called for increased private sector investment in Africa’s under-developed electricity transmission infrastructure, a vital ingredient for reaching Africa’s energy goals

Africa lags the rest of the world when it comes to electricity, with just 35 per cent of the population with access to power and a generation capacity of only 100 GW. Those who do have power typically consume relatively little, face frequent outages and pay high prices. 

Alongside generation and distribution, improving and increasing transmission infrastructure is key to closing the access gap. So far, transmission in Africa has been financed from public sources and new models of financing involving the private sector have received insufficient attention from policymakers or financiers. 

The ‘Linking up: Public-Private Partnerships in Power Transmission in Africa’ report examines private sector-led investments in transmission globally and how this approach is applicable in sub-Saharan Africa.  The private sector has participated successfully in transmission networks in many countries in Latin America and Asia, and this approach could be replicated.  

“Private finance has supported the expansion of electricity transmission infrastructure in many regions of the world and the same can happen in Africa.  To attract private sector investment, however, governments need to adopt policies supportive of this strategy and establish the right business, regulatory and legal environment to sustain investor interest,” said Riccardo Puliti, Senior Director and head of Energy and Extractives Industries at the World Bank. 

Estimates of annual investments required from 2015-2040 to expand the transmission network range from US$ 3.2bn to US$4.3bn. These investments are critical to delivering cost-effective power to households and industries. 

The report examined independent power transmission projects (IPTs) in five countries (Brazil, Chile, India, Peru and the Philippines) where major power sector reforms were undertaken to privatize the sector. The use of privately financed transmission lines in Brazil, Chile, Peru and India, for example, collectively raised over US$24.5bn of private investment between 1998 and 2015. This resulted in close to 100,000 km of new transmission lines. 

The study provides a set of recommendations for countries to adapt to specific local conditions and lists 10 steps to get there, including the right legal and regulatory framework, new models for concessional lending, competitive tender processes, adequate revenue flow and credit enhancement for projects, or tailored IPT projects to attract international investors, to name a few. 

View the literature around the report from the World Bank Group here. 

The Bell team in Richards Bay consists of more than 800 machinists, welders, and assemblers. (Image source: Bell)

GFE Power Product’s extensive range covers generators from 10 kVA up to 3,000 kVA. (Image source: GFE Power Products)

The funding is the largest-ever equity raise in the minigrid industry according to Husk. (Image source: Adobe Stock)

The initiative will help African contractors participate in annual infrastructure investments. (Image source: Afreximbank)

ITS has evolved into a sophisticated systems approach, providing numerous opportunities to revolutionise road networks. (Image source: Adobe Stock)

Invest International’s Lara Muller; Ivory Coast Minister of Finance and Economy, Adam Coulibaly; and Ambassador Designate to Ivory Coast, Jeroen Kelderhuis. (Image source: Invest International)

The Yellow Metal Machine Rental team with some Wacker Neuson equipment. (Image source: Wacker Neuson)

Although displaying resilience, the report warns that African banks remain exposed to physical climate risks due to both sovereign and industry lending. (Image source: Adobe Stock)

WAA and VCMI will seek to establish regulatory frameworks to enable access to high integrity and fair voluntary carbon markets for WAA member countries. (Image source: Adobe Stock)

The parties will also promote the mutual exchange of information and expertise in the field of export credit policies and practices. (Image source: TBD Group)

Inside Condra’s Johannesburg factory: an overhead crane positions an electric motor during assembly of hoist and crab. (Image source: Condra)

IVECO is renewing its entire product range, all at once. (Image source: IVECO)

The MoU was signed alongside the Africa Health Business Symposium. (Image source: Africa CDC)

Both the IMF and EIU expect SSA to rank as the world’s second fastest growing economy in 2024. (Image source: Adobe Stock)

There has been a focus on the sugar industry. (Image source: Adobe Stock)

Evolving concept of energy security must address energy demand, system flexibility, technology access and infrastructure development, says IRENA. (Image source: IRENA)

World Bank & African Development Bank partner to provide electricity access to 300 million Africans by 2030, leveraging public-private investments. (Image source: Adobe Stock)

(L-R): Dr Diane Karusisi, CEO, Bank of Kigali and Dr Reda Helal, group managing director – processing, Africa and co-head group processing, Network International. (Image source: Network International)

At WFES, Gotion High-tech will showcase its latest products and leading green energy solutions at its booth. (Image source: Gotion High-tech)

The new Perkins 5012 is a full-authority electronic engine optimised and purpose-built for power generation applications. (Image source: Perkins)

SSAB will begin deliveries of the new products in 2026.

The key issues restricting sub-Saharan Africa’s manufacturing sector will be unpacked at Manufacturing Indaba later this year. (Image source: Adobe Stock)

Through the innovative solution, each vessel can fill two tank containers on average between two ports. (Image source: Maersk)

Hyphen is developing sub-Saharan Africa’s largest, most advanced and only fully-vertical integrated green hydrogen project. (Image source: Hyphen)

According to Liebherr, the Used Equipment Marketplace is extremely user-friendly. (Image source: Liebherr)

Electricity storage will be pivotal in unlocking renewable projects and meeting energy demand. (Image source: Adobe Stock)

With RFID, assets can be given unique digital identities that enable users to identify and locate them all at once, from a distance, in real time. (Image source: Brady)

Africa Data Centres and DPA SA have broken ground on their solar farm in the Free State. (Image source: Africa Data Centres)

A Cat PM310 Cold Planer in action. (Image source: Caterpillar)

A larger stockholding of WEG products facilitates ready access for customers. (Image source: WEG Africa)