Energy Efficiency Made Simple Vol IV 2015

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Moreover, the tradition of having fossil fuel subsidies in place in certain countries, such as Nigeria, distorts the competitiveness of RE power projects, not reflecting the real levelised cost of electricity of thermal power plants. Operating IPPs Having suitable RE resources is therefore not sufficient. In addition to the elements cited, investors and developers must also be wary of the country’s Independent Power Producers’ (IPPs) track record. Table 1 summarises which countries in sub-Saharan Africa have op- erating IPPs. The next step is to evaluate if the IPP experience has been fruitful or not. In terms of procurement and contracting mechanisms, the global market trend is currently favouring a competitive bidding process – such as what has been implemented in the South African REIPPPP – even though Renewable Energy Feed-in Tariff (REFiT) continues being adopted mainly in emerging markets. This is the case of Ken- ya, Uganda, Tanzania, Rwanda, Nigeria, and Ghana, which have all implemented REFiTs. Some countries are also adopting a mix of REFiT and competitive bidding such as in Kenya, Uganda, and Tanzania. REFiTs are some- times limited to certain types of technologies such as small hydro and biomass like in Tanzania and Rwanda. The report [1] has combined eight different quantitative factors including the legal and political

framework, the economic and infrastructure development, as well as a natural resource assessment [3] performed by the International Renewable Energy Agency (IRENA) to identify countries with the best opportunities in terms of large-scale grid-connected RE power technologies. Small-scale (defined as smaller than 5 MW), off-grid, and embedded RE generation projects have not been accounted for and their potential should be considered in addition to the findings from this report. Results of the research indicate that best opportunities lie in South Africa, but also in Tanzania, Namibia, Kenya, Zambia, Nigeria, and Ethiopia, depending on the RE technology (limited to CSP, solar PV, wind, or geothermal). Despite not being in the top five ranking, Ivory Coast and Ghana have also been identified as countries which deserve particular attention for their large-scale solar PV potential. In 2014, total RE power installed capacity (including hydro and biomass) amounted to 27,6 GW in sub-Saharan Africa. Hydropower represents 85,8% of this amount. Nevertheless, geothermal, solar PV, and wind power witnessed the highest growth compared to the previous year, progressively eroding hydropower market share. As of June 2015, the pipeline of large-scale RE (solar PV, CSP, wind, and geothermal only) power projects (larger than 5 MW and excluding North Africa, South Africa, and the African islands) amounted to approximately 14,7 GW. Only 647 MW started the construction phase, the rest being in earlier stages of development.

Table 1: Countries with IPP presence.

Renewable Energy Support Policies Historical IPP Presence

IPP Presence Countries with IPP Presence, Sub-Saharan Africa, 2015 IPP Presence Liberia Madagascar Malawi Mali Mauritania Mozambique Namibia Niger Nigeria

Angola Benin Botswana Burkina Faso Burundi Cameroon Central African Republic Chad Congo-Brazzaville Cote d'Ivoire Dem. Republic of Congo Djibouti Equatorial Guinea Eritrea Ethiopia Gabon Gambia, The

IPP Present

IPP Presence Soon

Rwanda Senegal Sierra Leone Somalia South Africa Sudan Swaziland Tanzania Togo

IPP Not Present

Ghana Guinea Guinea-Bissau Kenya Lesotho

Uganda Zambia Zimbabwe

A good track record of IPPs, either for renewable or non-renewable technologies, is an important supporting factor to consider as it will help accelerate the involvement of future IPPs aimed to develop large-scale RE power projects. A lot of countries have put into place reforms to liberalise their electricity sector and open power generation to IPPs.

Source: Frost & Sullivan

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ENERGY EFFICIENCY MADE SIMPLE 2015